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[ { "docid": "71569", "title": "", "text": "You can move money in and out of the business at will, just keep track of every transaction. Ideally you'd use an accounting software like QuickBooks or similar. Create a Capital Contributions account and every time you put money into the business checking account record it as a Capital Contribution. Likewise, if you take money out of the business, it comes from your capital accounts. (You can create a separate Capital Distributions account in your accounting software, or just use a single account for contributions and distributions). Money coming in and out of those capital accounts is not taxable because you will pay taxes based on net earnings regardless of whether or not you have distributed any profits. So there's no need to make a loan to the company, which would have tax consequences. To reimburse yourself for purchases already made, submit an expense report to the company. If the company is unfunded right now, you can make a capital contribution to cover current expenses, submit the expense report, and wait until you have some profits before paying out the expense report or making any distributions. Welcome to entrepreneurship." } ]

[ { "docid": "576185", "title": "", "text": "The answer to your question is governed by the structure of the company and your ownership or lack thereof in the business. Australian business can be structured the same way U.S. ones are, as a sole proprietorship, partnership, LLC, or company. If you are only on the board and have no equity, you cannot be affected. You must have some amount of equity in the business to have any chance of being affected. If the business is a sole proprietorship, then the single individual running the business is personally responsible for all debt and the inability to pay obligations would result in personal bankruptcy which would in all likelihood affect your credit score (it would in the U.S.). If it is a partnership, then anyone holding stock in the company is likewise personally responsible for a portion of the debt, and can be subject to bankruptcy and credit score implications. If the business is structured as a limited liability company or a corporation, a stakeholder's personal finances are separate from the business's and their credit score cannot be affected." }, { "docid": "276411", "title": "", "text": "This is a complicated question that relies on the US-India Tax Treaty to determine whether the income is taxable to the US or to India. The relevant provision is likely Article 15 on Personal Services. http://www.irs.gov/pub/irs-trty/india.pdf It seems plausible that your business is personal services, but that's a fact-driven question based on your business model. If the online training is 'personal services' provided by you from India, then it is likely foreign source income under the treaty. The 'fixed base' and '90 days' provisions in Article 15 would not apply to an India resident working solely outside the US. The question is whether your US LLC was a US taxpayer. If the LLC was a taxpayer, then it has an obligation to pay US tax on any worldwide income and it also arguably disqualifies you from Article 15 (which applies to individuals and firms of individuals, but not companies). If you were the sole owner of the US LLC, and you did not make a Form 8832 election to be treated as subject to entity taxation, then the LLC was a disregarded entity. If you had other owners, and did not make an election, then you are a partnership and I suspect but cannot conclude that the treaty analysis is still valid. So this is fact-dependent, but you may be exempt from US tax under the tax treaty. However, you may have still had an obligation to file Forms 1099 for your worker. You can also late-file Forms 1099 reporting the nonemployee compensation paid to your worker. Note that this may have tax consequences on the worker if the worker failed to report the income in those years." }, { "docid": "321566", "title": "", "text": "In addition to asking an accountant, I would also ask a lawyer. When exploring the same question for myself, I found that one of the benefits of incorporating or forming an LLC is that your personal assets are better protected. Including asset protection, here are 5 reasons to incorporate: Initially, I thought that as I had so few assets, I should not be concerned. I was glad I was able to do a free consult with a lawyer who advised me to look into forming an LLC. (Ultimately, my planned business idea never panned out. So, I never went the incorporation/LLC route.) Hope this helps!" }, { "docid": "388713", "title": "", "text": "As a new (very!) small business, the IRS has lots of advice and information for you. Start at https://www.irs.gov/businesses/small-businesses-self-employed and be sure you have several pots of coffee or other appropriate aid against somnolence. By default a single-member LLC is 'disregarded' for tax purposes (at least for Federal, and generally states follow Federal although I don't know Mass. specifically), although it does have other effects. If you go this route you simply include the business income and expenses on Schedule C as part of your individual return on 1040, and the net SE income is included along with your other income (if any) in computing your tax. TurboTax or similar software should handle this for you, although you may need a premium version that costs a little more. You can 'elect' to have the LLC taxed as a corporation by filing form 8832, see https://www.irs.gov/businesses/small-businesses-self-employed/limited-liability-company-llc . In principle you are supposed to do this when the entity is 'formed', but in practice AIUI if you do it by the end of the year they won't care at all, and if you do it after the end of the year but before or with your first affected return you qualify for automatic 'relief'. However, deciding how to divide the business income/profits into 'reasonable pay' to yourself versus 'dividends' is more complicated, and filling out corporation tax returns in addition to your individual return (which is still required) is more work, in addition to the work and cost of filing and reporting the LLC itself to your state of choice. Unless/until you make something like $50k-100k a year this probably isn't worth it. 1099 Reporting. Stripe qualifies as a 'payment network' and under a recent law payment networks must annually report to IRS (and copy to you) on form 1099-K if your account exceeds certain thresholds; see https://support.stripe.com/questions/will-i-receive-a-1099-k-and-what-do-i-do-with-it . Note you are still legally required to report and pay tax on your SE income even if you aren't covered by 1099-K (or other) reporting. Self-employment tax. As a self-employed person (if the LLC is disregarded) you have to pay 'SE' tax that is effectively equivalent to the 'FICA' taxes that would be paid by your employer and you as an employee combined. This is 12.4% for Social Security unless/until your total earned income exceeds a cap (for 2017 $127,200, adjusted yearly for inflation), and 2.9% for Medicare with no limit (plus 'Additional Medicare' tax if you exceed a higher threshold and it isn't 'repealed and replaced'). If the LLC elects corporation status it has to pay you reasonable wages for your services, and withhold+pay FICA on those wages like any other employer. Estimated payments. You are required to pay most of your individual income tax, and SE tax if applicable, during the year (generally 90% of your tax or your tax minus $1,000 whichever is less). Most wage-earners don't notice this because it happens automatically through payroll withholding, but as self-employed you are responsible for making sufficient and timely estimated payments, and will owe a penalty if you don't. However, since this is your first year you may have a 'safe harbor'; if you also have income from an employer (reported on W-2, with withholding) and that withholding is sufficent to pay last year's tax, then you are exempt from the 'underpayment' penalty for this year. If you elect corporation status then the corporation (which is really just you) must always make timely payments of withheld amounts, according to one of several different schedules that may apply depending on the amounts; I believe it also must make estimated payments for its own liability, if any, but I'm not familiar with that part." }, { "docid": "585494", "title": "", "text": "\"Pay off the credit cards. From now on, pay off the credit cards monthly. Under no circumstances should you borrow money. You have net worth but no external income. Borrowing is useless to you. $200,000 in two bank accounts, because if one bank collapses, you want to have a spare while you wait for the government to pay off the guarantee. Keep $50,000 in checking and another $50k in savings. The remainder put into CDs. Don't expect interest income beyond inflation. Real interest rates (after inflation) are often slightly negative. People ask why you might keep money in the bank rather than stocks/bonds. The problem is that stocks/bonds don't always maintain their value, much less go up. The bank money won't gain, but it won't suddenly lose half its value either. It can easily take five years after a stock market crash for the market to recover. You don't want to be withdrawing from losses. Some people have suggested more bonds and fewer stocks. But putting some of the money in the bank is better than bonds. Bonds sometimes lose money, like stocks. Instead, park some of the money in the bank and pick a more aggressive stock/bond mixture. That way you're never desperate for money, and you can survive market dips. And the stock/bond part of the investment will return more at 70/30 than 60/40. $700,000 in stock mutual funds. $300,000 in bond mutual funds. Look for broad indexes rather than high returns. You need this to grow by the inflation rate just to keep even. That's $20,000 to $30,000 a year. Keep the balance between 70/30 and 75/25. You can move half the excess beyond inflation to your bank accounts. That's the money you have to spend each year. Don't withdraw money if you aren't keeping up with inflation. Don't try to time the market. Much better informed people with better resources will be trying to do that and failing. Play the odds instead. Keep to a consistent strategy and let the market come back to you. If you chase it, you are likely to lose money. If you don't spend money this year, you can save it for next year. Anything beyond $200,000 in the bank accounts is available for spending. In an emergency you may have to draw down the $200,000. Be careful. It's not as big a cushion as it seems, because you don't have an external income to replace it. I live in southern California but would like to move overseas after establishing stable investments. I am not the type of person that would invest in McDonald's, but would consider other less evil franchises (maybe?). These are contradictory goals, as stated. A franchise (meaning a local business of a national brand) is not a \"\"stable investment\"\". A franchise is something that you actively manage. At minimum, you have to hire someone to run the franchise. And as a general rule, they aren't as turnkey as they promise. How do you pick a good manager? How will you tell if they know how the business works? Particularly if you don't know. How will you tell that they are honest and won't just embezzle your money? Or more honestly, give you too much of the business revenues such that the business is not sustainable? Or spend so much on the business that you can't recover it as revenue? Some have suggested that you meant brand or stock rather than franchise. If so, you can ignore the last few paragraphs. I would be careful about making moral judgments about companies. McDonald's pays its workers too little. Google invades privacy. Exxon is bad for the environment. Chase collects fees from people desperate for money. Tesla relies on government subsidies. Every successful company has some way in which it can be considered \"\"evil\"\". And unsuccessful companies are evil in that they go out of business, leaving workers, customers, and investors (i.e. you!) in the lurch. Regardless, you should invest in broad index funds rather than individual stocks. If college is out of the question, then so should be stock investing. It's at least as much work and needs to be maintained. In terms of living overseas, dip your toe in first. Rent a small place for a few months. Find out how much it costs to live there. Remember to leave money for bigger expenses. You should be able to live on $20,000 or $25,000 a year now. Then you can plan on spending $35,000 a year to do it for real (including odd expenses that don't happen every month). Make sure that you have health insurance arranged. Eventually you may buy a place. If you can find one that you can afford for something like $100,000. Note that $100,000 would be low in California but sufficient even in many places in the US. Think rural, like the South or Midwest. And of course that would be more money in many countries in South America, Africa, or southern Asia. Even southern and eastern Europe might be possible. You might even pay a bit more and rent part of the property. In the US, this would be a duplex or a bed and breakfast. They may use different terms elsewhere. Given your health, do you need a maid/cook? That would lean towards something like a bed and breakfast, where the same person can clean for both you and the guests. Same with cooking, although that might be a second person (or more). Hire a bookkeeper/accountant first, as you'll want help evaluating potential purchases. Keep the business small enough that you can actively monitor it. Part of the problem here is that a million dollars sounds like a lot of money but isn't. You aren't rich. This is about bare minimum for surviving with a middle class lifestyle in the United States and other first world countries. You can't live like a tourist. It's true that many places overseas are cheaper. But many aren't (including much of Europe, Japan, Australia, New Zealand, etc.). And the ones that aren't may surprise you. And you also may find that some of the things that you personally want or need to buy are expensive elsewhere. Dabble first and commit slowly; be sure first. Include rarer things like travel in your expenses. Long term, there will be currency rate worries overseas. If you move permanently, you should certainly move your bank accounts there relatively soon (perhaps keep part of one in the US for emergencies that may bring you back). And move your investments as well. Your return may actually improve, although some of that is likely to be eaten up by inflation. A 10% return in a country with 12% inflation is a negative real return. Try to balance your investments by where your money gets spent. If you are eating imported food, put some of the investment in the place from which you are importing. That way, if exchange rates push your food costs up, they will likely increase your investments at the same time. If you are buying stuff online from US vendors and having it shipped to you, keep some of your investments in the US for the same reason. Make currency fluctuations work with you rather than against you. I don't know what your circumstances are in terms of health. If you can work, you probably should. Given twenty years, your million could grow to enough to live off securely. As is, you would be in trouble with another stock market crash. You'd have to live off the bank account money while you waited for your stocks and bonds to recover.\"" }, { "docid": "144563", "title": "", "text": "The thing you get wrong is that you think the LLC doesn't pay taxes on gains when it sells assets. It does. In fact, in many countries LLC are considered separate entities for tax properties and you have double taxation - the LLC pays its own taxes, and then when you withdraw the money from the LLC to your own account (i.e.: take dividends) - you pay income tax on the withdrawal again. Corporate entities usually do not have preferential tax treatment for investments. In the US, LLC is a pass-though entity (unless explicitly chosen to be taxed as a corporation, and then the above scenario happens). Pass-through entities (LLCs and partnerships) don't pay taxes, but instead report the gains to the owners, which then pay taxes as if the transaction was their personal one. So if you're in the US - investing under LLC would have no effect whatsoever on your taxes, or adverse effect if you chose to treat it as a corporation. In any case, investing in stocks is not a deductible expense, and as such doesn't reduce profits." }, { "docid": "446928", "title": "", "text": "From Schwab - What are the eligibility requirements for a business to establish a SEP-IRA? Almost any type of business is eligible to establish a SEP-IRA, from self-employed individuals to multi-person corporations (including sole proprietors, partnerships, S and C corporations, and limited liability companies [LLCs]), tax-exempt organizations, and government agencies. What are the contribution limits? You may contribute up to 25% of compensation (20% if you’re self-employed3) or $49,000 for 2011 and $50,000 for 2012, whichever is less. If we set the PC aside, you and the son have an LLC renting office space, this addresses the ability of the LLC to offer the retirement account." }, { "docid": "334603", "title": "", "text": "\"If you have a single member LLC there is no need to separate expenses in this way since it is simply treated as part of the owner's normal tax returns. This is the way I've been operating. Owner of Single-Member LLC If a single-member LLC does not elect to be treated as a corporation, the LLC is a \"\"disregarded entity,\"\" and the LLC's activities should be reflected on its owner's federal tax return. If the owner is an individual, the activities of the LLC will generally be reflected on: Form 1040 Schedule C, Profit or Loss from Business (Sole Proprietorship) (PDF) Form 1040 Schedule E, Supplemental Income or Loss (PDF) Form 1040 Schedule F, Profit or Loss from Farming (PDF) An individual owner of a single-member LLC that operates a trade or business is subject to the tax on net earnings from self employment in the same manner as a sole proprietorship. If the single-member LLC is owned by a corporation or partnership, the LLC should be reflected on its owner's federal tax return as a division of the corporation or partnership. https://www.irs.gov/businesses/small-businesses-self-employed/single-member-limited-liability-companies\"" }, { "docid": "582571", "title": "", "text": "\"You're confusing so many things at once here...... First thing first: we cannot suggest you what to do business-wise since we have no idea about your business. How on Earth can anyone know if you should sell the software to someone or try to distribute to customers yourself? How would we know if you should hire employees or not? If you say you don't need employees - why would you consider hiring them? If you say you want to sell several copies and have your own customers - why would you ask if you should sell your code to someone else? Doesn't make sense. Now to some more specific issues: I heard sole proprietary companies doesn't earn more than 250k and it's better to switch to corporation or LLC etc. because of benefits. I heard it was snowing today in Honolulu. So you heard things. It doesn't make them true, or relevant to you. There's no earning limit above which you should incorporate. You can be sole proprietor and make millions, and you can incorporate for a $10K/year revenue business. Sole proprietorship, incorporation (can be C-Corp or S-Corp), or LLC - these are four different types of legal entity to conduct business. Each has its own set of benefits and drawbacks, and you must understand which one suits you in your particular situation. For that you should talk to a lawyer who could help you understand what liability protection you might need, and to a tax adviser (EA/CPA licensed in your state) who can help you understand the tax-related costs and benefits of each choice. On the other hand I heard that if I create LLC company, in case of failure, they can get EVERYTHING from me, what's this all about? No. This is not true. Who are \"\"they\"\", how do you define \"\"failure\"\", and why would they get anything from you at all? Even without knowing all that, your understanding is wrong, because the \"\"LL\"\" in LLC stands for LIMITED liability. The whole point of forming LLC or Corporation is to limit your own personal liability. But mere incorporation or forming LLC doesn't necessarily mean your liability is limited. Your State law defines what you must do for that limited liability protection, and that includes proper ways to run your business. Again - talk to your lawyer and your tax adviser about what it means to you. I'm totally unfamiliar with everything related to taxes/companies/LLC/corporation etc Familiarize yourself. No-one is going to do it for you. Start reading, ask specific questions on specific issues, and get a proper legal and tax advice from licensed professionals.\"" }, { "docid": "192332", "title": "", "text": "\"Since as you say, an LLC is a pass-through entity, you will be making income in the U.S. when you sell to U.S. customers. And so you will need to file the appropriate personal tax forms in the US. As well as potentially in one or more States. The US government does not register LLCs. The various States do. So you'll be dealing with Oregon, Wisconsin, Wyoming, one of those for the LLC registration. You will also need to have a registered agent in the State. That is a big deal since the entire point of forming an LLC is to add a liability shield. You would lose the liability shield by not maintaining the business formalities. Generally nations aim to tax income made in their nation, and many decline to tax income that you've already paid taxes on in another nation. A key exception: If money is taxed by the U.S. it may also be taxed by one of the States. Two States won't tax the same dollar. Registering an LLC in one State does not mean you'll pay state taxes there. Generally States tax income made in their State. It's common to have a Wyoming LLC that never pays a penny of tax in Wyoming. Officially, an LLC doing business in a State it did not form in, must register in that State as a \"\"foreign LLC\"\" even though it's still in the USA. The fee is usually the same as for a domestic LLC. \"\"Doing business\"\" means something more than incidental sales, it means having a presence specifically in the State somehow. It gets complicated quick. If you are thinking of working in someone's app ecosystem like the Apple Store, Google Play, Steam etc. Obviously they want their developers coding, not wrestling with legalities, so some of them make a priority out of clearing and simplifying legal nuisances for you. Find out what they do for you.\"" }, { "docid": "535918", "title": "", "text": "\"What would be the best strategy to avoid paying income taxes on the sale after I move to another US state? Leaving the US and terminating your US residency before the sale closes. Otherwise consider checking your home country's tax treaty with the US. In any case, for proper tax planning you should employ a licensed tax adviser - an EA, CPA or an attorney licensed in your State (the one you'd be when the sale closes). No-one else is legally allowed to provide you tax advice on the matter. Because the company abroad is befriended, I have control over when (and e.g. in how many chunks) the earnings of the sale flow into my LLC. So I can plan where I live when that money hits my US account. I'm not familiar with the term \"\"befriended\"\" in this context, but form what I understand your description - its a shell corporation under your own control. This means that the transfer of money between the corporation and your LLC is of no consequence, you constructively received the money when the corporation got it, not the LLC. Your fundamental misunderstanding is that there's importance to when the money hits your US bank account. This is irrelevant. The US taxes your worldwide income, so it is taxed when you earn it, not when you transfer it into the country (as opposed to some other countries, for example India or the UK). As such, in your current scheme, it seems to me that you're breaking the US tax law. This is my personal impression, of course, get a professional advice from a licensed tax professional as I defined earlier.\"" }, { "docid": "382908", "title": "", "text": "Can I work on 1099 from my own company instead of on W2? The reason is on W2 I can't deduct my commute, Health Insurance and some other expenses while on 1099 I think I can able do that. Since I am going to client place to work not at my own office, I am not sure whether I should able to do that or not. If you have LLC, unless you elected to tax it as a corporation, you need neither 1099 nor W2. For tax purposes the LLC is disregarded. So it is, from tax perspective, a sole proprietorship (or partnership, if multiple members). Being a W2 employee of your own LLC is a bad idea. For all these above expenses, which can I use company's debit/credit card or I need to use only my personal debit/credit card? It would be better to always use a business account for business purposes. Doesn't matter much for tax per se, but will make your life easier in case of an audit or a legal dispute (limited liability protection may depend on it). If I work on 1099, I guess I need to file some reasonable taxes on quarterly basis instead of filing at year end. If so, how do I pay my tax on quarterly basis to IRS? I mean which forms should I file and how to pay tax? Unless you're a W2 employee, you need to do quarterly estimate payments using form 1040-ES. If you are a W2 employee (even for a different job, and even if it is not you, but your spouse with whom you're filing jointly) - you can adjust your/spouse's withholding using form W4 to cover the additional tax liability. This is, IMHO, a better way than paying estimates. There are numerous questions on this, search the site or ask another one for details." }, { "docid": "417388", "title": "", "text": "The 401(k) contribution is Federal tax free, when you make the contribution, and most likely State too. I believe that is true for California, specifically. There was a court case some years ago about people making 401(k) or IRA contributions in New York, avoiding the New York state income tax. Then they moved to Florida (no income tax), and took the money out. New York sued, saying they had to pay the New York income tax that had been deferred, but the court said no. So you should be able to avoid California state income tax, and then later if you were to move to, for example, Texas (no income tax), have no state income tax liability. At the Federal level, you will have different problems. You won't have the money; it will be held by the 401(k) trustee. When you try to access the money (cash the account out), you will have to pay the deferred taxes. Effectively, when you remove the money it becomes income in the year it is removed. You can take the money out at any time, but if you are less than 59 1/2 at the time that you take it, there is a 10% penalty. The agreement is that the Feds let you defer paying the tax because it is going to finance your retirement, and they will tax it later. If you take it out before 59 1/2, they figure you are not retired yet, and are breaking your part of the agreement. Of course you can generally leave the money in the 401(k) plan with your old employer and let it grow until you are 59.5, or roll it over into another 401(k) with a new employer (if they let you), or into an IRA. But if you have returned to your own country, having an account in the U.S. would introduce both investment risk and currency risk. If you are in another country when you want the money, the question would be where your U.S. residence would be. If you live in California, then go to, say France, your U.S. residence would still be California, and you would still owe California income tax. If you move from California to Texas and then to France, your U.S. residence would be Texas. This is pretty vague, as you might have heard in the Rahm Emanual case -- was he a resident of Chicago or Washington, D.C.? Same problem with Howard Hughes who was born in Texas, but then spent most his life in California, then to Nevada, then to Nicaragua, and the Bahamas. When he died Texas, California and Nevada all claimed him as a resident, for estate taxes. The important thing is to be able to make a reasonable case that you are a resident of where ever you want to be -- driver's license, mailing address, living quarters, and so on." }, { "docid": "591357", "title": "", "text": "The LLC is paying you. It would only be fraudulent if you were trying to move the money out of the LLC to avoid a liability. I'm pretty sure the transaction will be taxable income for you personally. Consider consulting with a CPA to ensure that you're doing the proper record keeping and to get advice on the best way to minimize tax burden while achieving your goals." }, { "docid": "536604", "title": "", "text": "\"Dude, you are totally moving the goal posts. First of all, the fact that you had to crawl through my comment history and came up with a completely unrelated response rather than addressing my point is pretty pathetic, and a pretty common behavior who are wrong and don't want to admit it. I don't \"\"hate\"\" California, I think it's overrated. And I think it's overrated because what you get isn't worth what you pay. That isn't being \"\"biased\"\", it's cause and effect. If it didn't cost 3x as much to live in California as anywhere else, I would like it a lot more. And the math doesn't work out. You in your original comment said the typical salary is 170K. Now that you have been proven wrong you are now claiming it's 200K+. That isn't the \"\"math working out\"\", that's distorting reality until it lines up with your preconceived notions. And now you are restricting \"\"nature\"\" to mountains (since apparently anything that isn't red river gorge is \"\"ant hills\"\" and therefore not worth anything). Again moving the goalposts. And even if your idea of \"\"things to do in nature\"\" means \"\"I like backpacking in the mountains exclusively\"\", you would be much better off in places like Utah than California. Repeatedly saying \"\"I've done the math, I've been offered a job\"\" doesn't mean anything when I've already shown you the math doesn't work out, and I too have been offered a 6 figure job in SF. I'm clearly not the one that's biased, you are. Look, if you have built up California into some mythical place so sacred that you are so clearly willing to do mental gymnastics you are demonstrating in order to make reality conform with your personal notions, great. But for everyone else, the \"\"math\"\" (as in actual math, not changing the numbers around until it makes sense), doesnt work out.\"" }, { "docid": "457805", "title": "", "text": "Delaware llc incorporation When someone want to do some business, but the person want to have some extremely flexible business so that he can able to start up with low cost and with affordable franchise text they Delaware llc incorporation is a very good choice for doing so. It mainly help to customize the corporation and can also help to choose that option which user want to have." }, { "docid": "250559", "title": "", "text": "\"This is why California tax code is even more messed up than the Federal - they take the Federal and then add some. Or remove. Or mix up. Whether your brokerage will send 1099 or not is up to the brokerage. Its a Federal requirement. California may require them to send it out for CA residents, or may not. They may adhere to the FTB, or may not. It doesn't matter to you. You'll have to keep track of the interest and dividends received, cost basis for the securities, etc etc., just as any other brokerage account. You cannot rely solely on the information on the 1099 anyway, since it doesn't include many things you have to take into account for your Federal tax return as well, wash sales (inter-brokerage) being the most obvious example. As to what happens when you're 65 - you'll have to keep track, again, of all the taxes paid, and track your California basis in the account, and your Federal basis in the account, and they will not be the same. Reconciliation time again when you get there. What a mess. If you move to another state - the taxes you paid to CA are \"\"lost\"\". Similarly, if you move in to California, all the gains prior to moving in are not taxed by California. Whatever happens after - is taxed by CA as if it was a regular investment account.\"" }, { "docid": "254158", "title": "", "text": "The LLC will file its own business taxes which may or may not have business level income and expenses. At the end, the LLC will issue Schedule K-1 tax forms to the members, that based on their percentage ownership, will reflect the percentage share of the income/losses. From an individual standpoint, the members need only worry about the K-1 form they receive. This has quite a few pass-through categories from the LLC, but the Income/Loss may be the only used one. The individual will likely include the K-1 by filing a Schedule-E along with their 1040 form. The 1040 Schedule-E has some ability to deduct expenses as an individual. Generally it's best not to commingle expenses. Additional schedule-E expense reporting is generally for non-reimbursed, but related business expenses. If a member paid certain fees for the LLC, it is better for the LLC to reimburse him and then deduct the expense properly. Schedule-E is on a non-LLC, personal level." }, { "docid": "299211", "title": "", "text": "\"-Alain Wertheimer I'm a hobbyist... Most (probably all) of those older items were sold both prior to my establishing the LLC This is a hobby of yours, this is not your business. You purchased all of these goods for your pleasure, not for their future profit. The later items that you bought after your LLC was establish served both purposes (perks of doing what you love). How should I go about reporting this income for the items I don't have records for how much I purchased them for? There's nothing you can do. As noted above, these items (if you were to testify in court against the IRS). \"\"Losses from the sale of personal-use property, such as your home or car, aren't tax deductible.\"\" Source Do I need to indicate 100% of the income because I can't prove that I sold it at a loss? Yes, if you do not have previous records you must claim a 100% capital gain. Source Addition: As JoeTaxpayer has mentioned in the comments, the second source I posted is for stocks and bonds. So at year begin of 2016, I started selling what I didn't need on eBay and on various forums [January - September]. Because you are not in the business of doing this, you do not need to explain the cost; but you do need to report the income as Gross Income on your 1040. Yes, if you bought a TV three years ago for a $100 and sold it for $50, the IRS would recognize you earning $50. As these are all personal items, they can not be deducted; regardless of gain or loss. Source Later in the year 2016 (October), I started an LLC (October - December) If these are items that you did not record early in the process of your LLC, then it is reported as a 100% gain as you can not prove any business expenses or costs to acquire associated with it. Source Refer to above answer. Refer to above answer. Conclusion Again, this is a income tax question that is split between business and personal use items. This is not a question of other's assessment of the value of the asset. It is solely based on the instruments of the IRS and their assessment of gains and losses from businesses. As OP does not have the necessary documents to prove otherwise, a cost basis of $0 must be assumed; thus you have a 100% gain on sale.\"" } ]

[ { "docid": "357938", "title": "", "text": "From my experience, I opened a business account to handle my LLC which owns a rental property. The account process and features were similar to shopping for a personal checking account. There would be fees for falling below a minimum balance, and for wanting a paper statement. In my case, keeping $2000 avoids the fee, and I pull the statements online and save the PDFs. Once open for a certain amount of time, you might be able to get credit extended based on the money that flows through that account. The online access is similar to my personal checking, as is the sending of payments electronically." } ]

[ { "docid": "177946", "title": "", "text": "\"I think the \"\"right\"\" way to approach this is for your personal books and your business's books to be completely separate. You would need to really think of them as separate things, such that rather than being disappointed that there's no \"\"cross transactions\"\" between files, you think of it as \"\"In my personal account I invested in a new business like any other investment\"\" with a transfer from your personal account to a Stock or other investment account in your company, and \"\"This business received some additional capital\"\" which one handles with a transfer (probably from Equity) to its checking account or the like. Yes, you don't get the built-in checks that you entered the same dollar amount in each, but (1) you need to reconcile your books against reality anyway occasionally, so errors should get caught, and (2) the transactions really are separate things from each entity's perspective. The main way to \"\"hack it\"\" would be to have separate top-level placeholder accounts for the business's Equity, Income, Expenses, and Assets/Liabilities. That is, your top-level accounts would be \"\"Personal Equity\"\", \"\"Business Equity\"\", \"\"Personal Income\"\", \"\"Business Income\"\", and so on. You can combine Assets and Liabilities within a single top-level account if you want, which may help you with that \"\"outlook of my business value\"\" you're looking for. (In fact, in my personal books, I have in the \"\"Current Assets\"\" account both normal things like my Checking account, but also my credit cards, because once I spend the money on my credit card I want to think of the money as being gone, since it is. Obviously this isn't \"\"standard accounting\"\" in any way, but it works well for what I use it for.) You could also just have within each \"\"normal\"\" top-level placeholder account, a placeholder account for both \"\"Personal\"\" and \"\"My Business\"\", to at least have a consistent structure. Depending on how your business is getting taxed in your jurisdiction, this may even be closer to how your taxing authorities treat things (if, for instance, the business income all goes on your personal tax return, but on a separate form). Regardless of how you set up the accounts, you can then create reports and filter them to include just that set of business accounts. I can see how just looking at the account list and transaction registers can be useful for many things, but the reporting does let you look at everything you need and handles much better when you want to look through a filter to just part of your financial picture. Once you set up the reporting (and you can report on lists of account balances, as well as transaction lists, and lots of other things), you can save them as Custom Reports, and then open them up whenever you want. You can even just leave a report tab (or several) open, and switch to it (refreshing it if needed) just like you might switch to the main Account List tab. I suspect once you got it set up and tried it for a while you'd find it quite satisfactory.\"" }, { "docid": "361836", "title": "", "text": "You could conceivably open a few accounts. For example, a bank account and a credit card account. Then the accounts will be older when evaluated for credit when you return. This would look better than opening fresh accounts later. But don't expect a big difference in score. And you'll be stuck with those accounts in the future, otherwise you lose the benefit. I wouldn't worry about maintaining balances now. You can wait until you come back. Occasional purchases may be helpful. What they really want to see is a regular and sustained use of accounts without missing payments or overextending. But if you're not going to be here, you can't really do that. Note that good credit scores are based on seven years of data, preferably a lot of it. Opening a few accounts can't substitute for that, even if you put balances on them. If you're not here, you won't be paying rent or utilities. You won't have a proven payment history on the most common accounts. If money were no object, you could do something like purchase a house or condo that you could rent out, utilities included. That would build up a payment history. But if money were no object, you probably wouldn't be worried about your credit score. It's more practical to just live normally and be sure that you always live within your means so that you don't experience negative credit events. You might think about why you want a good credit score. Is it to borrow a lot of money? You might be able to spend money to achieve that. Is it to save money on future borrowing? If it costs money now, how much will you save total? Opening accounts now that you won't really use until you return is about the only thing that you can do that won't cost you money. Perhaps put a balance on the bank account--at least you'll get that money back some day. Maintaining a balance on the credit cards would cost you money in interest charges, and you don't really benefit from an improved credit score until you use your credit. So the interest fees aren't really buying you anything." }, { "docid": "64556", "title": "", "text": "If you're a sole proprietor there's no reason to have a separate business account, as long as you keep adequate records, as you are one and the same for tax purposes. My husband and I already have 5 accounts and a mortgage with one bank. I don't see the need to open up yet another account. As a contracted accountant, I don't need to write business checks, and my expenses are minimal. As long as I have an present my assumed business name certificate and ID, there's no reason for a bank not to deposit into my personal account." }, { "docid": "79411", "title": "", "text": "\"This is not an end-all answer but it'll get you started I have been through accounting courses in college as well as worked as a contractor (files as sole proprietor) for a few years but IANAA (I am not an accountant). Following @MasonWheeler's answer, if you're making that much money you should hire a bean counter to at least overlook your bookkeeping. What type of business? First, if you're the sole owner of the business you will most likely file as a sole proprietorship. If you don't have an official business entity, you should get it registered officially asap, and file under that name. The problem with sole proprietorships is liability. If you get sued, not only are your business' assets vulnerable but they can go after your personal assets too (including house/cars/etc). Legally, you and your business are considered one and the same. To avoid liability issues, you could setup a S corporation. Basically, the business is considered it's own entity and legal matters can only take as much as the business owns. You gain more protection but if you don't explicitly keep your business finances separate from your personal finances, you can get into a lot of trouble. Also, corporations generally pay out more in taxes. Technically, since the business is it's own entity you'll need to pay yourself a 'reasonable salary'. If you skip the salary and pay yourself the profits directly (ie evade being taxed on income/salary) the IRS will shut you down (that's one of the leading causes of corporations being shut down). You can also pay distribute bonuses on top of that but it would be wise to burn the words 'within reason' into your memory first. The tax man gets mad if you short him on payroll taxes. S corporations are complicated, if you go that route definitely seek help from an accountant. Bookkeeping If you're not willing to pay a full time accountant you'll need to do a lot of studying about how this works. Generally, even if you have a sole proprietorship it's best to have a separate bank account for all of your business transactions. Every source/drain of money will fall into one of 3 categories... Assets - What your business owns: Assets can be categorized by liquidity. Meaning how fast you can transform them directly into cash. Just because a company is worth a lot doesn't necessarily mean it has a lot of cash. Some assets depreciate (lose value over time) whereas some are very hard to transform back into cash based on the value and/or market fluctuations (like property). Liabilities - What you owe others and what others owe you: Everything you owe and everything that is owed to you gets tracked. Just like credit cards, it's completely possible to owe more than you own as long as you can pay the interest to maintain the loans. Equity - the net worth of the company: The approach they commonly teach in schools is called double-entry bookkeeping where they use the equation: In practice I prefer the following because it makes more sense: Basically, if you account for everything correctly both sides of the equation should match up. If you choose to go the sole proprietorship route, it's smart to track everything I've mentioned above but you can choose to keep things simple by just looking at your Equity. Equity, the heart of your business... Basically, every transaction you make having to do with your business can be simplified down to debits (money/value) increasing and credits (money/value) decreasing. For a very simple company you can assess this by looking at net profits. Which can be calculated with: Revenues, are made up of money earned by services performed and goods sold. Expenses are made up of operating costs, materials, payroll, consumables, interest on liabilities, etc. Basically, if you brought in 250K but it cost you 100K to make that happen, you've made 150K for the year in profit. So, for your taxes you can count up all the money you've made (Revenues), subtract all of the money you've paid out (Expenses) and you'll know how much profit you've made. The profit is what you pay taxes on. The kicker is, there are gray areas when it comes to deducting expenses. For instance, you can deduct the expense of using your car for business but you need to keep a log and can only expense the miles you traveled explicitly for business. Same goes for deducting dedicated workspaces in your house. Basically, do the research if you're not 100% sure about a deduction. If you don't keep detailed books and try to expense stuff without proof, you can get in trouble if the IRS comes knocking. There are always mythical stories about 'that one guy' who wrote off his boat on his taxes but in reality, you can go to jail for tax fraud if you do that. It comes down to this. At the end of the year, if your business took in a ton of money you'll owe a lot in taxes. The better you can justify your expenses, the more you can reduce that debt. One last thing. You'll also have to pay your personal federal/state taxes (including self-employment tax). That means medicare/social security, etc. If this is your first foray into self-employment you're probably not familiar with the fact that 1099 employers pick up 1/2 of the 15% medicare/social security bill. Typically, if you have an idea of what you make annually, you should be paying this out throughout the year. My pay as a contractor was always erratic so I usually paid it out once/twice a year. It's better to pay too much than too little because the gov't will give you back the money you overpaid. At the end of the day, paying taxed sucks more if you're self-employed but it balances out because you can make a lot more money. If as you said, you've broken six figures, hire a damn accountant/adviser to help you out and start reading. When people say, \"\"a business degree will help you advance in any field,\"\" it's subjects like accounting are core requirements to become a business undergrad. If you don't have time for more school and don't want to pay somebody else to take care of it, there's plenty of written material to learn it on your own. It's not rocket surgery, just basic arithmetic and a lot of business jargon (ie almost as much as technology).\"" }, { "docid": "50000", "title": "", "text": "\"What is a good bank to use for storing my pay? Preferrably one that has free student accounts. Can I save money from my paychecks directly to a Canadian bank Otherwise, can I connect my bank account to my Canadian account online? Any (almost...) bank in the US has free college checking accounts. If the bank you entered doesn't - exit, and step into the one next door which most likely will. The big names - Wells Fargo, Bank Of America, Chase, Bank of the West, Union Bank, Citi etc - all have it. Also, check your local credit union. Do I need any ID to open a bank account? I have Canadian citizenship and a J-1 visa Bring your passport and a student card/driving license (usually 2 ID's required). What form of money should I take with me? Cash? Should I apply for a debit card? Can I use my Canadian credit card for purchasing anything in the states? (Canadian dollar is stronger than US dollar currently, so this could be to my advantage?) There's some fuss going on about debit cards right now. Some big banks (Bank of America, notably) decided to charge fees for using it. Check it, most of the banks are not charging fees, and as far as I know none of the credit unions are charging. So same thing - if they charge fees for debit card - step out and move on to the next one down the street. Using debit card is pretty convenient, cash is useful for small amount and in places that don't accept cards. If you're asking about how to move money from Canada - check with your local (Canadian) bank about the conversion rates and fees for transfers, check cashing, ATM, card swipes, etc - and see which one is best for you. When I moved large amounts of money across the border, I chose wire transfer because it was the cheapest, but for small amounts many times during the period of your stay it may be more expensive. You can definitely use your Canadian credit/debit card in the States, you'll be charged some fee by your credit card company, and of course the conversion rate. How much tax does I have to pay at the end of my internship? Let's assume one is earning $5,000 per month plus a one time $5,000 housing stipend, all before taxes. Will I be taxed again by the Canadian government? $5K for internship? Wow... You need to talk to a tax specialist, there's probably some treaty between the US and Canada on that, and keep in mind that the State of California taxes your income as well. What are some other tips I can use to save money in the California? California is a very big place. If you live in SF - you'll save a lot by using the MUNI, if your internship is in LA - consider buying an old clunker if you want to go somewhere. If you're in SD - just enjoy the weather, you won't get it in Canada. You'll probably want a \"\"pay as you go\"\" wireless phone plan. If your Canadian phone is unlocked GSM - you can go to any AT&T or T-Mobile store and get a pre-paid SIM for free. Otherwise, get a prepaid phone at any groceries store. It will definitely be cheaper than paying roaming charges to your Canadian provider. You can look at my blog (I'm writing from California), I accumulated a bunch of saving tips there over the years I'm writing it.\"" }, { "docid": "406109", "title": "", "text": "\"Anyone can walk into a bank, say \"\"Hi, I'm a messenger, I have an endorsed check and a filled out deposit slip for Joe Blow who has an account here, please deposit this check for him, as he is incapacitated. Straight deposit.\"\" They'll fiddle on their computer, to see if they can identify the deposit account definitively, and if they can, and the check looks legit, \"\"thanks for taking care of our customer sir.\"\" Of course, getting a balance or cashback is out of the question since you are not authenticated as the customer. I have done the same with balance transfer paperwork, in that case the bank knew the customer and the balance transfer was his usual. If the friend does not have an account there, then s/he should maybe open an account at an \"\"online bank\"\" that allows deposit by snapping photos on a phone, or phone up a branch, describe her/his situation and see if they have any options. Alternately, s/he could get a PayPal account. Or get one of those \"\"credit card swipe on your phone\"\" deals like Square or PayPal Here, which have fees very close to nil, normally cards are swiped but you can hand-enter the numbers. Those are fairly easy to get even if you have troubles with creditworthiness. S/he would need to return the check to the payer and ask the payer to pay her/him one of those ways. The payer may not be able to, e.g. if they are a large corporation. A last possibility is if the check is from a large corporation with whom s/he continues to do business with. For instance, the electric company cashiers out your account after you terminate service at your old location. But then you provision service at a new location and get a new bill, you can send their check right back to them and say \"\"Please apply this to my new account\"\". If s/he is unable to get any of those because of more serious problems like being in the country illegally, then, lawful behavior has its privileges, sorry. There are lots of unbanked people, and they pay through the nose for banking services at those ghastly check-cashing places, at least in America. I don't have a good answer for how to get a check cashed in that situation.\"" }, { "docid": "314499", "title": "", "text": "It sounds like your looking for something like an offshore bank (e.g. an anonymous Swiss bank account). These don't really exist anymore. I think you should just open a small bank account in your home country (preferably one the reimburses your ATM fees, like Charles Schwab in the US). If it's a small amount of money, the authorities probably won't care and they won't be able to give you large penalties anyways." }, { "docid": "28758", "title": "", "text": "I would say when starting with Gnucash to start with the level of granularity you are comfortable with while sticking to the double entry bookkeeping practices. So going through each one: Refund for Parking Pass. Assuming you treat the Parking Pass as a sunk cost, i.e. an Expense account, its just a negative entry in the Expense account which turns into a positive one in your Bank account. Yes it may look weird, and if you don't like it you can always 'pay from Equity' the prior month, or your Bank Account if you're backfilling old statements. Selling physical items. If you sold it on eBay and the value is high enough you'll get tax forms indicating you've earned x. Even if its small or not done via eBay, treat it the same way and create a 'Personal Items/Goods' Income account to track all of it. So the money you get in your Bank account would have come from there. Found jacket money would be an Equity entry, either Opening Balances into Cash or Bank account. Remember you are treating Equity / Opening Balances as the state before you started recording every transaction so both the value going into Assets (Banks,Stock,Mutual Funds) and Liabilities (Mortgage, Student Debt, Credit Card Debt) originate from there." }, { "docid": "5219", "title": "", "text": "Most US banks don't allow you the ability to draft a foreign currency check from USD. Though, I know Canadian banks are more workable. For instance, TD allows you to do this from CAD to many other currencies for a small fee. I believe even as a US Citizen you can quite easily open a TD Trust account and you'd be good to go. Also, at one time Zions bank was one of the few which lets US customers do this add-hoc. And there is a fee associated. Even as a business, you can't usually do this without jumping thru hoops and proving your business dealings in foreign countries. Most businesses who do this often will opt to using a payment processor service from a 3rd party which cuts checks in foreign currencies at a monthly and per check base. Your other option, which may be more feasible if you're planning on doing this often, would be to open a British bank account. But this can be difficult if not impossible due to the strict money laundering anti-fraud regulations. Many banks simply won't do it. But, you might try a few of the newer British banks like Tesco, Virgin and Metro." }, { "docid": "467108", "title": "", "text": "I'd say you have a couple options that differ by the amount of time required. Option 1: Export your checking/credit card ledgers from your banks for the unaccounted for periods you mention then import them into GNUcash. They won't be categorized, but it's a fairly simple task to go through and categorize the main ones. Anything else can be categorized in an 'unaccounted for' account and either properly categorized over time at a later date or just left unaccounted for. Option 2: Make one entry in each of your liabilities and assets that is also part of the 'unaccounted for' expense account, but contains the number required to balance your accounts now. This is by far the easiest and will allow you to start with a clean slate now but keep your prior records in the same ledger. Option 3: Start a new ledger with the same account/expense structure as your previous ledger. From here on out, you'd open this GNUCash file and start fresh. Also quick and easy but there is no way to look at the old ledger and run reports unless you open that separately. I actually do this every couple of years as a way to force me to clear out obsolete accounts and trim the fat since GNUcash can take a long time to open when the ledger contains many years of transactions." }, { "docid": "339017", "title": "", "text": "\"Coming from someone who has worked a in the account servicing department of an actual bank in the US, other answers are right, this is probably a scam, the phone number on the letter is probably ringing to a fraudulent call center (these are very well managed and sound professional), and you must independently locate and dial the true contact number to US Bank. NOW. Tell them what happened. Reporting is critical. Securing your money is critical. Every piece of information you provided \"\"the bank\"\" when you called needs to be changed or worked around. Account numbers, passwords, usernames, card numbers get changed. Tax ID numbers get de-prioritized as an authentication mechanism even if the government won't change them. The true bank probably won't transfer you to the branch. If the front-line call center says they will, ask the person on the phone what the branch can do that they cannot. Information is your friend. They will probably transfer you to a special department that handles these reports. Apparently Union Bank's call center transfers you to the branch then has the branch make this transfer. Maybe their front-line call center team is empowered to handle it like I was. Either way, plug your phone in; if the call takes less than 5 minutes they didn't actually do everything. 5 to 8 minutes per department is more likely, plus hold time. There's a lot of forms they're filling out. What if that office is closed because of time differences? Go online and ask for an ATM limit increase. Start doing cash advances at local banks if your card allows it. Just get that money out of that account before it's in a fraudsters account. Keep receipts, even if the machine declines the transaction. Either way, get cash on hand while you wait for a new debit card and checks for the new account you're going to open. What if this was fraud, you draw your US Bank account down to zero $800 at a time, and you don't close it or change passwords? Is it over? No. Then your account WILL get closed, and you will owe EVERYTHING that the fraudsters rack up (these charges can put your account terrifyingly far in the negative) from this point forward. This is called \"\"participation in a scam\"\" in your depository agreement, because you fell victim to it, didn't report, and the info used was voluntarily given. You will also lose any of your money that they spend. What if US Bank really is closing your account? Then they owe you every penny you had in it. (Minus any fees allowed in the depository agreement). This closure can happen several days after the date on the warning, so being able to withdraw doesn't mean you're safe. Banks usually ship an official check shipped to the last known address they had for you. Why would a bank within the United States close my account when it's not below the minimum balance? Probably because your non-resident alien registration from when you were in school has expired and federal law prohibits them from doing business with you now. These need renewed at least every three years. Renewing federally is not enough; the bank must be aware of the updated expiration date. How do I find out why my account is being closed? You ask the real US Bank. They might find that it's not being closed. Good news! Follow the scam reporting procedure, open a new account (with US Bank if you want, or elsewhere) and close the old one. If it IS being closed by the bank, they'll tell you why, and they'll tell you what your next options are. Ask what can be done. Other commenters are right that bitcoin activity may have flagged it. That activity might actually be against your depository agreement. Or it set off a detection system. Or many other reasons. The bank who services your account is the only place that knows for sure. If I offer them $500 per year will they likely keep the account opened? Otherwise I got to go to singapore open another account Legitimate financial institutions in the United States don't work this way. If there is a legal problem with your tax status in the US, money to the bank won't solve it. Let's call the folks you've talked to \"\"FraudBank\"\" and the real USBank \"\"RealBank,\"\" because until RealBank confirms, we have no reason to believe that the letter is real. FraudBank will ask for money. Don't give it. Don't give them any further information. Gather up as much information from them as possible instead. Where to send it, for example. Then report that to RealBank. RealBank won't have a way to charge $500/year to you only. If they offer a type of account to everyone that costs $500, ask for the \"\"Truth in Savings Act disclosures.\"\" Banks are legally required to provide these upon request. Then read them. Don't put or keep your money anywhere you don't understand.\"" }, { "docid": "274400", "title": "", "text": "\"This is a tough question, because it is something very specific to your situation and finances. I personally started at a young age (17), with US$1,000 in Scottrade. I tried the \"\"stock market games\"\" at first, but in retrospect they did nothing for me and turned out to be a waste of time. I really started when I actually opened my brokerage account, so step one would be to choose your discount broker. For example, Scottrade, Ameritrade (my current broker), E-Trade, Charles Schwab, etc. Don't worry about researching them too much as they all offer what you need to start out. You can always switch later (but this can be a little of a hassle). For me, once I opened my brokerage account I became that much more motivated to find a stock to invest in. So the next step and the most important is research! There are many good resources on the Internet (there can also be some pretty bad ones). Here's a few I found useful: Investopedia - They offer many useful, easy-to-understand explanations and definitions. I found myself visiting this site a lot. CNBC - That was my choice for business news. I found them to be the most watchable while being very informative. Fox Business, seems to be more political and just annoying to watch. Bloomberg News was just ZzzzZzzzzz (boring). On CNBC, Jim Cramer was a pretty useful resource. His show Mad Money is entertaining and really does teach you to think like an investor. I want to note though, I don't recommend buying the stocks he recommends, specially the next day after he talks about them. Instead, really pay attention to the reasons he gives for his recommendation. It will teach you to think more like an investor and give you examples of what you should be looking for when you do research. You can also use many online news organizations like MarketWatch, The Motley Fool, Yahoo Finance (has some pretty good resources), and TheStreet. Read editorial (opinions) articles with a grain of salt, but again in each editorial they explain why they think the way they think.\"" }, { "docid": "107747", "title": "", "text": "Is it possible to open a GBP bank account in Pakistan ? Yes, I have one in HBL. Askari and SCB also offer GBP, USD, Yen and Euro Accounts. They might ask for source of income but that shouldn't be a problem. I work in Singapore (should my Salary Slip to open account) and do online remit from my Singapore Account to HBL GBP, the good thing is the exact amount in GBP gets transferred (although I have to tolerate SG Bank's exchange rates) Are there any risks in doing so ? No Risk but caution. If you are a Tax Filer in Pakistan, then you MUST include this account's balance in opening/closing and also mention any remitances receievd in this account under Income and Assets seperately. All money is legit with bank statements of my pay which is between 35K and 40K per year, am I going to have any trouble at airport as limit is £7K only Cash carry limit while travelling has nothing to do with FC (Foreign Currency) Account. You should never travel with more than 10K USD in total." }, { "docid": "219673", "title": "", "text": "Of course you can. My assumption is you are/will be in UK. I am a student from outside the UK and I am about to start studying at a UK university/college/school. How do I choose which bank is best for me? You should be able to open a ‘basic bank account’ with a number of different banks. A ‘basic bank account’ provides easy access to banking facilities for adults in the UK. Additionally, some banks offer a bank account tailored specifically for your needs as an international student. There is a table on pages 6 & 7 of this leaflet that has a list of basic accounts and other accounts that may be suitable along with brief descriptions of some of their features. Most banks don’t ask you to pay in any money to open a basic account. You should look around to see which bank and account suit you best and then visit the local branch of the bank you have chosen. You may also be able to get other types of account, as detailed in the next section. Please speak to a bank Go through the source I have linked. It is a bit old, but has relevant information for you. SOURCE" }, { "docid": "536483", "title": "", "text": "Normal high street accounts certainly are available to non-residents. I have several, and I haven't been resident in the UK for fourteen years. However you do need to open them before you leave. They need identification. Once you have one open, the same bank should be able to open other accounts by mail. The disadvantage of course is that you will pay tax on your earnings, and while you can claim it back that's an unnecessary piece of work if you don't have other UK earnings. I would take the risk of an offshore account, assuming it's with a big reputable bank - the kind that are going to be bailed out if there is another collapse. An alternative might be a fixed term deposit. You lock up your money for three years, and you get it back plus a single interest payment at the end of three years. You would pay nothing in tax while you were gone, but the whole interest amount would be taxable when you got back." }, { "docid": "186846", "title": "", "text": "\"This answer is an attempt to answer the actual question posed. Please keep in mind that this applies specifically to the Equifax credit model that Mint uses as mentioned in the accepted answer, and that different models may react in different ways (or not at all). As mentioned in the comments, the number of total accounts you have does not have much bearing on your overall credit score. If you click on Mint's \"\"About Total Accounts\"\" link, you get the following statement: Total Accounts has a low impact on your score. Second, the way the Total Accounts score is represented is misleading. This is not a count of the total number of accounts you have open, but rather how many accounts you have in your total history. Mint's header under this metric is flat out wrong: Try to have a good mix of credit lines open. To back up the assertion that this is looking at total accounts in your credit history rather than just those that are open, my Mint report shows 2 open accounts and 7 closed accounts, for a total of 9. Under the Total Accounts metric, I am plotted smack dab in the middle of the \"\"Not Bad\"\" range, right where people with 9 would be plotted. So the proper advice here is to just let it be and only open new accounts as you need them. As you amass credit history, this metric will continue to grow naturally - it should never decrease. You may ask, then, why did your overall score decrease when you paid off your student loans? Most likely because your average age of credit dropped when you closed your loan account. If you're like most people I know, your student loan is one of your oldest accounts, so closing that account will hurt your score - credit age is measured only on your open accounts.\"" }, { "docid": "298638", "title": "", "text": "Your sister-in-law should know that anybody, US citizen or not, can open a US bank account. She should do that and then pay her 20k fee to the company. I'm a Canadian citizen and I have a US bank account and I don't even live nor work in the United States. I only use it when I travel for leisure and order online. This looks like a scam, but if you know well your sister-in-law, it may not be." }, { "docid": "457989", "title": "", "text": "\"In answering your question as it's written: I don't think you're really \"\"missing\"\" something. Different banks offer different rates. Online banks, or eBanking solutions, such as CapitalOne, Ally, Barclays, etc., typically offer higher interest rates on basic savings accounts. There are differences between Money Market accounts and Standard Savings accounts, but primarily it comes down to how you can access your cash. This may vary based on bank, but Ally has a decent blurb about it: Regular savings accounts are easy to open and, when you choose an online bank like Ally Bank, you tend to get interest rates that are more competitive than brick-and-mortar counterparts, according to Bankrate.com. Additionally, as a member of the FDIC, Ally Bank gives you peace of mind knowing that the money in your Ally Bank Online Savings Account is insured to the maximum allowed by the law. Money market accounts are easy to open, too. And again, online banks may offer better rates than traditional banks. Generally, you have a bit more flexibility of access with a money market account than you do with a savings account. You can access funds in your Ally Bank Money Market Account through electronic fund transfers, checks, debit cards and ATM withdrawals. With savings accounts, your access is limited to electronic funds transfers or telephone withdrawals (and in-person withdrawals at traditional banks). Both types of accounts are subject to federal transaction limits. Here's a bit more information about a Money Market Account and why the rate might be a little bit higher (from thesimpledollar.com): A money market deposit account is a bit different. The restrictions on what a bank can do with that money are somewhat looser – they can often invest that money in things such as treasury notes, certificates of deposit, municipal bonds, and so on in addition to the tight restrictions of a normal savings accounts. In other words, the bank can take your money and invest it in other investments that are very safe. Now outside of your question, if you have $100K that you want to earn interest on, I'd suggest looking at options with higher rates of return rather than a basic savings account which will top out around 1% or so. What you do with that money is dependent on how quickly you need access to it, and there are a lot of Q&A's on this site that cover suggestions.\"" }, { "docid": "124191", "title": "", "text": "Couple of my friends went through a fraud agent who ran off with their money and the landlords were none the wiser. So it always pays to be a bit diligent. Are they a well known letting agents nationally ? Many agents do have different accounts to manage their properties. Yours seems a case as such probably i.e. they manage the property on behalf of the landlord so keeping their monies differentiated. Did you sign an agreement ? If yes go through what is written in the agreement, most of it is same in all agreements but have a look anyway. Check if there is mention of deposit protection scheme. One thing you could do is go to a bank to do the transfer, the same bank where the letting agent holds their account and confirm from them if it is really a personal account or a business account. I am not sure how possible it is, but doesn't hurt to ask. If it is a personal account, then fraud is the most possible cause. The sort code should tell you which branch and which bank. Or the best option is to ask the estate agents to show a recent statement of the bank account, where the money is to be deposited into. Some tips" } ]

[ { "docid": "537593", "title": "", "text": "Yes, it's a good idea to have a separate business account for your business because it makes accounting and bookkeeping that much easier. You can open a business checking account and there will be various options for types of accounts and fees. You may or may not want an overdraft account, for example, or a separate business credit card just so you can more easily separate those expenses from your personal cards. When I started my business, I opened a business checking account and met with my banker every year just to show them how the business was doing and to keep the relationship going. Eventually, when I wanted to establish a business line of credit, it was easier to set up because I they were already familiar with my business, its revenue, and needs for a line of credit. You can set up a solo 401k with your bank, too, and they'll be very happy to do so, but I recommend shopping around for options. I've found that the dedicated investment firms (Schwab, Fidelity, etc.) tend to have better options, fees, and features for investment accounts. Just because a specific bank handles your checking account doesn't mean you need to use that bank for everything. Lastly, I use completely different banks for my personal life and for my business. Maybe I'm paranoid, but I just don't want all my finances in the same place for both privacy reasons and to avoid having all my eggs in the same basket. Just something to consider -- I don't really have a completely sane reason for using completely different banks, but it helps me sleep." } ]

[ { "docid": "576362", "title": "", "text": "Before answering specific question, you are liable to pay tax as per your bracket on the income generated. I work with my partner and currently we transfer all earning on my personal bank account. Can this create any issue for me? If you are paying your partner from your account, you would need to maintain proper paperwork to show the portion of money transferred is not income to you. Alternatively create a join Current Account. Move funds there and then move it to your respective accounts. Which sort off account should be talk and by whose name? Can be any account [Savings/Current]. If you are doing more withdrawls open Current else open Savings. It does not matter on whos name the account is. Paperwork to show income matters from tax point of view. What should we take care while transfering money from freelance site to bank? Nothing specific Is there any other alternative to bank? There is paypal etc. However ultimately it flows into a Bank Account. What are other things to be kept in mind? Keep proper record of actual income of each of you, along with expenses. There are certain expenses you can claim from income, for example laptop, internet, mobile phone etc. Consult a CA he will be able to guide and it does not cost much." }, { "docid": "399584", "title": "", "text": "In france you have several options: A good place to starts with: 1% as of may 2015 interest is low, but's money is 100% liquid (you can withdraw antime). You got slightly superior interest rates, and have to wire at least 45€ a month on it. It gives you lots of advantages if you use it to buy a house. You cannot use the money unless you close the account, so it's not as flexible. You get 2% rates as of may 2015 which is quite good. [If you open this account now, it's only 1% making it not so attractive. Look at Life Insurance Instead.] This one is useless: interest rate is too low. I highly recommend this one. You can open it with 0 cost with several online banks (ing, boursorama, ...) Minimum deposit should be around 1000€. Rate is flexible, but usually higher than what you get with the others. You shouldn't withdraw the money before 8 years (because of taxes, but you can still do it if you need). You can add money on it later if you want. Because of the 8 year duration, it's better to open one as soon as you can, even with the minimum amount. Open an PEL + Livret A + Life insurance. Put the minimum on both PEL + life insurance. Put every thing else on Livret A. If you are 100% sure you don't need some of the livret A money, send it to PEL. [As of 2017, PEL is not so attractive anymore. Bet on the Life Insurance instead, unless your account was open prior to this]." }, { "docid": "143922", "title": "", "text": "I would like to avoid this, so what I'm thinking about is to open a bank account abroad, and use Transferwise to transfer my HUF to that account. Do you think this makes sense? It does make sense. The challange is to find a Bank that will allow you to open an account online. Are there any more effective way to save money? Try prepaid cards. You should be able to get these from normal Banks in Hungary or other reputed financial institutions. You will have a visibility of the rates and it would be one time conversion." }, { "docid": "525049", "title": "", "text": "\"Thanks for the reply man. Yeah it literally says \"\"closed\"\" next to the accou t name. But we finally got ahold of someone, I guess they close your account whenever you have $0 in it and the account should open again 1-2 business days after the direct deposit tries to go into her account. At least that's what the lady said. She hates this bank but we live in a small town and there's just not many options in terms of banking here. Thanks for the help though man I appreciate it!\"" }, { "docid": "274358", "title": "", "text": "Yea good points and they definitely should not be overlooked. The whole point of the EV calculation is to get the analyst to look at what the true underlying business is and what one is really paying for when buying securities in a company. Market Cap can be misleading for many reasons and get real annoyed when people say things like, I own XYZ company because its cash account is greater than its market cap...." }, { "docid": "92462", "title": "", "text": "Are there banks where you can open a bank account without being a citizen of that country without having to visit the bank in person? I've done it the other way around, opened a bank account in the UK so I have a way to store GBP. Given that Britain is still in the EU you can basically open an account anywhere. German online banks for instance allow you to administrate anything online, should there be cards issued you would need an address in the country. And for opening an account a passport is sufficient, you can identify yourself in a video chat. Now what's the downside? French banks' online services are in French, German banks' services are in German. If that doesn't put you off, I would name such banks in the comments if asked. Are there any online services for investing money that aren't tied to any particular country? Can you clarify that? You should at least be able to buy into any European or American stock through your broker. That should give you an ease of mind being FCA-regulated. However, those are usually GDRs (global depository receipts) and denominated in GBp (pence) so you'd be visually exposed to currency rates, by which I mean that if the stock goes up 1% but the GBP goes up 1% in the same period then your GDR would show a 0% profit on that day; also, and more annoyingly, dividends are distributed in the foreign currency, then exchanged by the issuer of the GDR on that day and booked into your account, so if you want to be in full control of the cashflows you should get a trading account denominated in the currency (and maybe situated in the country) you're planning to invest in. If you're really serious about it, some brokers/banks offer multi-currency trading accounts (again I will name them if asked) where you can trade a wide range of instruments natively (i.e. on the primary exchanges) and you get to manage everything in one interface. Those accounts typically include access to the foreign exchange markets so you can move cash between your accounts freely (well for a surcharge). Also, typically each subaccount is issued its own IBAN." }, { "docid": "279480", "title": "", "text": "\"This answer is based on my understanding of the US banking system. We have check cashing businesses here too, which are just like what you describe, except for the spelling :-) Let's consider what \"\"cash it for free at the bank\"\" really means, and why it might not be an option for everyone. One key issue is \"\"which bank?\"\" As an example, suppose that I have an account at ABC Bank. I take out my checkbook for that account and write you a check for $500. (Terminology: In this case, I am the drawer or maker of the check, ABC Bank is the drawee bank, and you, user54609, are the payee. Disclaimer: \"\"You\"\" here is meant as a generic pronoun and I do not mean to insinuate that anything here actually applies to you personally.) There are two common things you might do with the check: If you have an account at some bank, say XYZ Bank, you might take the check to XYZ Bank and deposit it in your account. (You might be able to do this through an ATM, mobile app, or by mail, instead of in person.) XYZ Bank does not have a way to verify with certainty that the check is valid (e.g. they don't know what my signature looks like, nor whether I actually have $500 in my account at ABC), so they send it to ABC Bank, which verifies the check and transfers $500 to XYZ. (This is usually done through a central clearinghouse, such as the Federal Reserve in the US, and in some cases an image of the check may be sent electronically, instead of the physical check.) This process takes some time, so XYZ may not make the $500 available to you right away - there may be a hold period before you can withdraw that $500 from your account. You could take the check to ABC Bank, in person. They will verify on the spot that the check is valid and that you are in fact user54609. If everything looks good, they will hand you $500 in cash (perhaps subtracting a fee of a few dollars). Now we can see some possible problems with each of these approaches. For 1: Maybe you don't have a bank account at all. There are many possible reasons: You don't have enough money to meet the minimum balance that a bank account would require. You used to have an account, but you overdrew or otherwise misused an account, so the bank closed it. They then entered you in a registry such as ChexSystems which ensures that other banks know about this, and so no other bank will open a new account for you. You immigrated to the country illegally and cannot get the documents (driver's license, social security number, etc) that a bank normally requires to open an account. You simply don't like the idea of keeping your money in a bank. Maybe you do have an account at XYZ Bank, but it's in another town. You need the cash today, so you can't use mail or a mobile app, and third-party ATMs usually don't accept deposits. Maybe you need to spend the money today, and XYZ Bank would place a hold. For 2: ABC Bank may not have a branch you can conveniently visit. Maybe the nearest one is a long way away, in another city or across the country. Or maybe ABC is an online bank with no physical branches at all. Maybe it's in the same city, but you don't have transportation to get you there. Or maybe it's simply less convenient than the check-cashing business on the corner. Maybe it is after usual banking hours, or a weekend, and ABC Bank is closed, but you need cash now. In any of these situations, \"\"cash it at the bank\"\" might not be a viable option, and so you might reasonably turn to a check cashing business instead. As you say, you will pay a much higher fee there, but maybe it is worth it to you, or you just don't have any choice. Another possibility, of course, is that you are poorly educated about the banking system, and you don't really understand that 1 and 2 are options, or how to go about them. But there's this storefront on the corner that says \"\"Check Cashing\"\", so this seems like a low-stress, uncomplicated way to exchange this piece of paper for money. As such, there certainly are people who legitimately might want to cash a valid check at a check-cashing business. Check cashing business do of course take some risk of fraud, since they can't necessarily verify the check. There are sometimes steps they can take to minimize this risk. Sometimes they can call ABC Bank and check that I have sufficient money in my account. Maybe they'll only accept certain kinds of checks, such as payroll checks from well-known companies for which you can produce a matching pay stub. And they can demand identification from you (perhaps allowing more flexible options than a bank), which helps ensure that you are the payee, and would make you easier to track down if you did commit fraud. But they will probably lose some money this way, so they will have to make their fees high enough to cover those losses.\"" }, { "docid": "298638", "title": "", "text": "Your sister-in-law should know that anybody, US citizen or not, can open a US bank account. She should do that and then pay her 20k fee to the company. I'm a Canadian citizen and I have a US bank account and I don't even live nor work in the United States. I only use it when I travel for leisure and order online. This looks like a scam, but if you know well your sister-in-law, it may not be." }, { "docid": "496857", "title": "", "text": "\"HSBC, Hang Seng, and other HK banks had a series of special savings account offers when I lived in HK a few years ago. Some could be linked to the performance of your favorite stock or country's stock index. Interest rates were higher back then, around 6% one year. What they were effectively doing is taking the interest you would have earned and used it to place a bet on the stock or index in question. Technically, one way this can be done, for instance, is with call options and zero coupon bonds or notes. But there was nothing to strategize with once the account was set up, so the investor did not need to know how it worked behind the scenes... Looking at the deposit plus offering in particular, this one looks a little more dangerous than what I describe. See, now we are in an economy of low almost zero interest rates. So to boost the offered rate the bank is offering you an account where you guarantee the AUD/HKD rate for the bank in exchange for some extra interest. Effectively they sell AUD options (or want to cover their own AUD exposures) and you get some of that as extra interest. Problem is, if the AUD declines, then you lose money because the savings and interest will be converted to AUD at a contractual rate that you are agreeing to now when you take the deposit plus account. This risk of loss is also mentioned in the fine print. I wouldn't recommend this especially if the risks are not clear. If you read the fine print, you may determine you are better off with a multicurrency account, where you can change your HK$ into any currency you like and earn interest in that currency. None of these were \"\"leveraged\"\" forex accounts where you can bet on tiny fluctuations in currencies. Tiny being like 1% or 2% moves. Generally you should beware anything offering 50:1 or more leverage as a way to possibly lose all of your money quickly. Since you mentioned being a US citizen, you should learn about IRS form TD F 90-22.1 (which must be filed yearly if you have over $10,000 in foreign accounts) and google a little about the \"\"foreign account tax compliance act\"\", which shows a shift of the government towards more strict oversight of foreign accounts.\"" }, { "docid": "224102", "title": "", "text": "(Assuming in the US) There are several possibilities, but to be honest anyone here is only going to be able to make guesses. To get the answer, the account holder (your girlfriend) is going to have to contact the bank and ask them directly. Some possibilities include: Suspicion of money laundering, suspicion of possible illegal activities in the account (e.g. check kiting), suspicion of possible prohibited activities (not necessarily illegal, but as defined in the account agreement, they may not allow activity related to gambling or pornographic businesses, for example), suspicion of business activity taking place in a non-business account, insufficient KYC (Know Your Customer) information on the account (such as they did not or could not verify required information during the account opening process), a negative ChexSystems report (for example, they found out through ChexSystems she had derogatory information reported on another account at another bank previously), or extended period of time it was overdrafted (usually 30+ days). I should also add that any bank/credit union has just as much a right to close an account with a customer, as the customer has the right to close their account with the bank/credit union, at any time, without notice. In *most* cases (although not all), when a bank closes an account, they will send a letter to the address on file for the account beforehand explaining the reasons. Have her check her mail. Are you sure the account is actually *closed*, and not just *blocked*? It could just be in a blocked status due to overdraft or some other reason, which is very different from being closed. As for where the direct deposit went - if the account is truly closed, then the money is being returned back to the company that initiated the direct deposit - usually takes 2-3 business days. Your girlfriend will have to contact the company's payroll department to arrange other means of payment, such as a check. In any case, it's all speculation at this point until the bank can be contacted to find out the real reason why. (Tip for the future: Look at switching to a bank that has 24/7 customer service)" }, { "docid": "322456", "title": "", "text": "\"No. This is too much for most individuals, even some small to medium businesses. When you sell that investment, and take the cheque into the foreign bank and wire it back to the USA in US dollars, you will definitely obtain the final value of the investment, converted to US$. Thats what you wanted, right? You'll get that. If you also hedge, unless you have a situation where it is a perfect hedge, then you are gambling on what the currencies will do. A perfect hedge is unusual for what most individuals are involved in. It looks something like this: you know ForeignCorp is going to pay you 10 million quatloos on Dec 31. So you go to a bank (probably a foreign bank, I've found they have lower limits for this kind of transaction and more customizable than what you might create trading futures contracts), and tell them, \"\"I have this contract for a 10 million quatloo receivable on Dec 31, I'd like to arrange a FX forward contract and lock in a rate for this in US$/quatloo.\"\" They may have a credit check or a deposit for such an arrangement, because as the rates change either the bank will owe you money or you will owe the bank money. If they quote you 0.05 US$/quatloo, then you know that when you hand the cheque over to the bank your contract payment will be worth US$500,000. The forward rate may differ from the current rate, thats how the bank accounts for risk and includes a profit. Even with a perfect hedge, you should be able to see the potential for trouble. If the bank doesnt quite trust you, and hey, banks arent known for trust, then as the quatloo strengthens relative to the US$, they may suspect that you will walk away from the deal. This risk can be reduced by including terms in the contract requiring you to pay the bank some quatloos as that happens. If the quatloo falls you would get this money credited back to your account. This is also how futures contracts work; there it is called \"\"mark to market accounting\"\". Trouble lurks here. Some people, seeing how they are down money on the hedge, cancel it. It is a classic mistake because it undoes the protection that one was trying to achieve. Often the rate will move back, and the hedger is left with less money than they would have had doing nothing, even though they bought a perfect hedge.\"" }, { "docid": "429785", "title": "", "text": "Hey there...You asked me earlier to take a look at this.I will send you later, when I get home a small plan that helped me a lot when I opened my bar, with a lot of nice things that you should be careful...And tbh I don't think a degree is that important.They will teach you how to manage a business in general, you will only use just a small percent from that knowledge...You can learn a lot of things strictly for managing a bar/restaurant by yourself, from books and internet...For me experience was very important (I was a bartender for 4 years, my brother was a waiter)...In 4 years we learned almost everything that we needed.The taxes should be made by an accountant (Here in Europe every company needs an accountant, this is the law.) Where do you live and what age are you ?" }, { "docid": "467108", "title": "", "text": "I'd say you have a couple options that differ by the amount of time required. Option 1: Export your checking/credit card ledgers from your banks for the unaccounted for periods you mention then import them into GNUcash. They won't be categorized, but it's a fairly simple task to go through and categorize the main ones. Anything else can be categorized in an 'unaccounted for' account and either properly categorized over time at a later date or just left unaccounted for. Option 2: Make one entry in each of your liabilities and assets that is also part of the 'unaccounted for' expense account, but contains the number required to balance your accounts now. This is by far the easiest and will allow you to start with a clean slate now but keep your prior records in the same ledger. Option 3: Start a new ledger with the same account/expense structure as your previous ledger. From here on out, you'd open this GNUCash file and start fresh. Also quick and easy but there is no way to look at the old ledger and run reports unless you open that separately. I actually do this every couple of years as a way to force me to clear out obsolete accounts and trim the fat since GNUcash can take a long time to open when the ledger contains many years of transactions." }, { "docid": "188640", "title": "", "text": "They are the worst. I knew all about these deceptive practices when I decided to open a checking account for my business with them in 2015. I was working in a remote place and it was one of the two banks that had locations germane to both work sites.I didn't like signing up with them because of all this bullshit but hey, they had the branches, right? Then I found out they were charging my workers $5 to cash checks. Pressured them to open an account or else: $5. Fuck you and the carriage you rode in on, Mr. Wells. I went to the other small regional bank and even though they don't have a slick web interface that makes it easier for me they DON'T charge my guys to get their money. Never again." }, { "docid": "546779", "title": "", "text": "If this matters to you a lot, I agree you should leave. My primary bank account raised chequing account and transaction fees. I left. When I was closing my account the teller asked for the reason (they needed to fill out a form) and I explained it was the monthly fees. Eventually, if a bank gets enough of these, they will change. I want to get back those features for the same price it cost when I opened it They are in their rights to cancel features or raise prices. Just as you are in your rights to withdraw if they don't give you a deal. The reason why I mention this is that this approach is comical in some instances. A grocery store may raise the price of carrots. Typically you either deal with it or change stores. Prices rise occasionally. thus they will lose a lot of money from my savings From my understanding, a bank makes a large chunk of their money from fees. Very little is from the floating kitty they can have because of your savings. If you have an investment account with your bank (not recommended) or your mortgage, that would matter more. I've had friends who have left banks (and moved their mortgages) because of the bank not giving them a better rate. Does the manager have any pressure into keeping the account to the point of giving away free products to keep the costumer or they don't really care? Depends. I've probably say no. One data point is an anecdote; it is expected in a client base of thousands that a few will leave for seemingly random reasons. Only if mass amounts of clients leave or complain will the manager or company care. A note: some banks waive monthly account or service fees if you keep a minimal account balance. I have one friend who keeps X thousand in his bank account to save the account fee; he budgets a month ahead of time and savings account rates are 0% so this costs him nothing." }, { "docid": "124191", "title": "", "text": "Couple of my friends went through a fraud agent who ran off with their money and the landlords were none the wiser. So it always pays to be a bit diligent. Are they a well known letting agents nationally ? Many agents do have different accounts to manage their properties. Yours seems a case as such probably i.e. they manage the property on behalf of the landlord so keeping their monies differentiated. Did you sign an agreement ? If yes go through what is written in the agreement, most of it is same in all agreements but have a look anyway. Check if there is mention of deposit protection scheme. One thing you could do is go to a bank to do the transfer, the same bank where the letting agent holds their account and confirm from them if it is really a personal account or a business account. I am not sure how possible it is, but doesn't hurt to ask. If it is a personal account, then fraud is the most possible cause. The sort code should tell you which branch and which bank. Or the best option is to ask the estate agents to show a recent statement of the bank account, where the money is to be deposited into. Some tips" }, { "docid": "28758", "title": "", "text": "I would say when starting with Gnucash to start with the level of granularity you are comfortable with while sticking to the double entry bookkeeping practices. So going through each one: Refund for Parking Pass. Assuming you treat the Parking Pass as a sunk cost, i.e. an Expense account, its just a negative entry in the Expense account which turns into a positive one in your Bank account. Yes it may look weird, and if you don't like it you can always 'pay from Equity' the prior month, or your Bank Account if you're backfilling old statements. Selling physical items. If you sold it on eBay and the value is high enough you'll get tax forms indicating you've earned x. Even if its small or not done via eBay, treat it the same way and create a 'Personal Items/Goods' Income account to track all of it. So the money you get in your Bank account would have come from there. Found jacket money would be an Equity entry, either Opening Balances into Cash or Bank account. Remember you are treating Equity / Opening Balances as the state before you started recording every transaction so both the value going into Assets (Banks,Stock,Mutual Funds) and Liabilities (Mortgage, Student Debt, Credit Card Debt) originate from there." }, { "docid": "195207", "title": "", "text": "Do you have a separate bank account for your business? That is generally highly recommended. I have a credit card for my single-member LLC. I prefer it this way because it makes the separation of personal and business expenses very clear. Using a personal credit card, but using it for only business expenses seems to be a reasonable practice. You may be able to do one better though... For your sole proprietorship, you can file a DBA which establishes the business name. The details of this depend on your state. With a DBA, I believe you can open a bank account in the name of your business and you may also be able to open a credit card account in the name of the business. I'm not sure what practical difference it makes, but it does make the personal/business distinction clearer. Though, at that point, you might as well just do the LLC..." }, { "docid": "444589", "title": "", "text": "\"EBITDA is in my opinion not a useful measure for an investor looking to buy shares on the stock market. It is more useful for private businesses open to changing their structuring, or looking to sell significant parts of their business. One of the main benefits of reporting Earnings Before Interest, Taxes, Depreciation & Amortization, is that it presents the company as it would look to a potential buyer. Consider that net income, as a metric, includes interest costs, taxes, and depreciation. Interest costs are (to put it simply) a result of multiplying a business's debt by its interest rate. If you own a business, and personally guarantee the loan that the company has with the bank, your interest rates might be artificially low. If you have a policy of reaching high debt levels relative to your equity, in order to achieve high 'financial leveraging', your interest cost might be artificially high. Either way, if I bought your business, my debt structure could be completely different, and therefore your interest costs are not particularly relevant to me, a potential buyer. Instead, I should attempt to anticipate what my own interest costs would be, under my plans for your business. Taxes are a result of many factors, including the corporate structure of the business. If you run your business as a sole proprietorship (ie: no corporation), but I want to buy it under my corporation, then my tax rates could look nothing like yours. Or if we operated in multiple jurisdictions. etc. etc. Instead of using your taxes as an estimate for mine, I should anticipate my taxes based on my plans for your business. Depreciation / amortization is a measure that estimates how much of a business's \"\"fixed assets\"\" were \"\"used up\"\" during the year. ie: how much wear and tear occurred on your fleet of trucks? It is generally calculated as a % of your overall asset value. It is a (very loose) proxy for the cash costs which will ultimately be incurred to make repairs/replacements. D&A is also something which could significantly change if a business changes hands. If the value of your building is much higher now than when you bought it, I will have higher D&A costs than you [because I will be recording a % of total costs higher than yours], and therefore I should forecast my own D&A. Removing these costs from Net Income is not particularly relevant for a casual stock investor, because these costs will not change when you buy shares. Whatever IBM's interest cost is, reflects the debt structuring policy that the company currently has. Therefore when you buy a share in IBM, you should consider the impact that interest has on net income. Similarly for taxes and D&A - they reflect costs to the business that impact the company's ability to pay you a dividend, and therefore you should look at net income, which includes those costs. Why would a business with 'good net income' and 'good EBITDA' report EBITDA? Because EBITDA will always be higher than net income. Why say $10M net income, when you could say $50M EBITDA? The fact is, it's easy to report, and is generally well understood - so why not report it, when it also makes you look better, from a purely \"\"big number = good\"\" perspective? I'm not sure that reporting EBITDA implies any sort of manipulative reporting, but it would seem that Warren Buffet feels this is a risk.\"" } ]

[ { "docid": "415946", "title": "", "text": "In the equity markets, the P/E is usually somewhere around 15. The P/E can be viewed as the inverse of the rate of a perpetuity. Since the average is 15, and the E/P of that would be 6.7%, r should be 6.7% on average. If your business is growing, the growth rate can be incorporated like so: As you can see, a high g would make the price negative, in essence the seller should actually pay someone to take the business, but in reality, r is determined from the p and an estimated g. For a business of any growth rate, it's best to compare the multiple to the market, so for the average business in the market with your business's growth rate and industry, that P/E would be best applied to your company's income." } ]

[ { "docid": "478832", "title": "", "text": "\"This is the best tl;dr I could make, [original](http://www.bbc.co.uk/news/business-40642152) reduced by 45%. (I'm a bot) ***** > Growth in UK house prices has continued to slow, but the cost of the average home still increased by 4.7% in the year to May 2017. > The main contribution to the rise in house prices came from England, where prices jumped by 5%. The average price of a house in England is now £238,000, the ONS said, while a property in Wales costs £150,000 after a 3.8% increase in prices over the past 12 months. > Within England, the smallest price rise in the year to May was seen in the North East, up 1.6%, while London had the second lowest price rise of 3%. The highest price rise was 7.5% in the East, just ahead of the East Midlands where property values went up by 7.2%. "Richard Snook, senior economist at business services company PwC, said:"The figures are in line with our expectations that growth in 2017 will be around half that of 2016. ***** [**Extended Summary**](http://np.reddit.com/r/autotldr/comments/6o284h/house_price_growth_continues_to_slow_in_uk/) | [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ \"\"Version 1.65, ~169772 tl;drs so far.\"\") | [Feedback](http://np.reddit.com/message/compose?to=%23autotldr \"\"PM's and comments are monitored, constructive feedback is welcome.\"\") | *Top* *keywords*: **price**^#1 **house**^#2 **year**^#3 **rise**^#4 **average**^#5\"" }, { "docid": "254245", "title": "", "text": "What's the present value of using the payment plan? In all common sense the present value of a loan is the value that you can pay in the present to avoid taking a loan, which in this case is the lump sum payment of $2495. That rather supposes the question is a trick, providing irrelevant information about the stock market. However, if some strange interpretation is required which ignores the lump sum and wants to know how much you need in the present to pay the loan while being able to make 8% on the stock market that can be done. I will initially assume that since the lender's APR works out about 9.6% per month that the 8% from the stock market is also per month, but will also calculate for 8% annual effective and an 8% annual nominal rate. The calculation If you have $x in hand (present value) and it is exactly enough to take the loan while investing in the stock market, the value in successive months is $x plus the market return less the loan payment. In the third month the loan is paid down so the balance is zero. I.e. So the present value of using the payment plan while investing is $2569.37. You would need $2569.37 to cover the loan while investing, which is more than the $2495 lump sum payment requires. Therefore, it would be advisable to make the lump sum payment because it is less expensive: If you have $2569.37 in hand it would be best to pay the lump sum and invest the remaining $74.37 in the stock market. Otherwise you invest $2569.37 (initially), pay the loan and end up with $0 in three months. One might ask, what rate of return would the stock market need to yield to make it worth taking the loan? The APR proposed by the loan can be calculated. The present value of a loan is equal to the sum of the payments discounted to present value. I.e. with ∴ by induction So by comparing the $2495 lump sum payment with $997 over 3 x monthly instalments the interest rate implied by the loan can be found. Solving for r If you could obtain 9.64431% per month on the stock market the $x cash in hand required would be calculated by This is equal to the lump sum payment, so the calculated interest is comparable to the stock market rate of return. If you could gain more than 9.64431% per month on the stock market it would be better to invest and take the loan. Recurrence Form Solving the recurrence form shows the calculation is equivalent to the loan formula, e.g. becomes v[m + 1] = (1 + y) v[m] - p where v[0] = pv where In the final month v[final] = 0, i.e. when m = 3 Compare with the earlier loan formula: s = (d - d (1 + r)^-n) / r They are exactly equivalent, which is quite interesting, (because it wasn't immediately obvious to me that what the lender charges is the mirror opposite of what you gain by investing). The present value can be now be calculated using the formula. Still assuming the 8% stock market return is per month. If the stock market yield is 8% per annum effective rate and if it is given as a nominal annual yield, 8% compounded monthly" }, { "docid": "101180", "title": "", "text": "Let's assume you have total year income I. The inflation rate is R and the growth rate is E every year. The contributed rate deducting 1.8% will be C = 0.982. So, for your account you'll have every year Let's assume you have annual income in 1000, then for years So, you'll deposit 40 000 and got at the end 129 023.60. But be careful, economic calculation for so long period could be very incaccurate because of the variation of the inflation rate, growth rate and various risks. The spreadsheet could be very useful. More accurate formula which assume that annual deposit grows only the half of the year. Thus, the result for 40 years will be 124 576.91." }, { "docid": "155957", "title": "", "text": "As the referenced document says, there are 3 formulas, and you need to use the formula which results the greatest margin requirement. In your case, you need to use the 10% formula:" }, { "docid": "25585", "title": "", "text": "id like to start by saying youre still doing this yourself, and i dont actually have all the info required anyway, dont send it but >[3] Descriptive Statistical Measures: Provide a thorough discussion of the meaning and interpretation of the four descriptive >statistical measures required in your analysis: (1) Arithmetic Mean, (2) Variance, (3) Standard Deviation and (4) Coefficient of >Variation. For example, how are these measures related to each other? In order to develop this discussion, you may want to >consult chapters 2 and 3 of your textbook. This topic is an important part of your report. can be easily interpreted, im guessing the mean is simply just the observed (and then projected stock price for future models) the standard deviation determines the interval in which the stock price fluctuates. so you have like a curve, and then on this curve theirs a bunch of normal distributions modeling the variance of the price plotted against the month also the coefficient of variation is just r^2 so just read up on that and relate it to the meaning of it to the numbers you have actually my stats are pretty rusty so make sure you really check into these things but otherwise the formulas for part 4 is simple too. you can compare means of a certain month using certain equations, but there are different ones for certain situations you can test for significance by comparing the differences of the means and if its outside of your alpha level then it probably means your company is significantly different from the SP index. (take mu of SP - mu of callaway) you can also find more info on interpreting the two different coefficients your given if you look up comparing means of linear regression models or something" }, { "docid": "568522", "title": "", "text": ">I note that each response to me includes a personal insult. False. I don't know, nor do I care, why people downvote, but I assume it's because you're letting emotion cloud reason. The point isn't that people may lose jobs, it's that an inefficient business should go under. This is [/r/business](/r/business) not [/r/sappytearjerker](/r/sappytearjerker). Brick and Mortar retailers suffer when a more efficient and broad-reaching business such as amazon comes about. They mostly go into these stores to check out the products and decided which to purchase online for less. What I think about whether or not these people will get another job in T time is irrelevant to the point, again, that inefficient companies should go under." }, { "docid": "427805", "title": "", "text": "If I is the initial deposit, P the periodic deposit, r the rent per period, n the number of periods, and F the final value, than we can combine two formulas into one to get the following answer: F = I*(1+r)n + P*[(1+r)n-1]/r In this case, you get V = 1000*(1.05)20 + 100*[(1.05)20-1]/0.05 = 5959.89 USD. Note that the actual final value may be lower because of rounding errors." }, { "docid": "99757", "title": "", "text": "I don't have all the answers. On a illiquid stock, such situations do arise and there are specific mechanisms used by exchanges to match the order. It is generally not advisable to use market order on illiquid stock. There are lots of different variations here. I guess this comes down to specifications for individual exchanges, but I'm wondering if there's a standard here or a way to approach it from basic rules that clears up all these situations. There are quite a few variations and different treatments. Market order that are placed when the market is closed or just around market opening are traded at Market Open price that each exchange has a formulae to calculate. In the process Market Buy are matched to Market Sell at the Exchange calculated price. Not all order get matched and there could be spill over's. These are then matched to limit orders. Is this determined based on which sell order came first, or based on which would result in the best deal for the incoming buyer? Generally Market orders have highest priority of execution." }, { "docid": "299347", "title": "", "text": "A major consideration is also formula. IF your child is breast fed, it will save you some money, but it doesn't work for all children. There are also a wide variety of prices/qualities of formula." }, { "docid": "115899", "title": "", "text": "\"From the perspective of a small business owner: First there are no entry level positions. There are only lower paying positions and higher paying positions. Get the idea that employers are supposed to be your post secondary education out of your mind. Replace that with working your ass off and impressing employers with your skill set. The reality is I make a hiring decision based first on these two accounting factors. #1 How much do I have to invest in this person to make them effective #2 How long until this person is covering his/her own overhead and begin to turn a profit. Then you get into \"\"is this person going to fit with my team\"\" etc.. I am always going to choose the person that has the best return formula for my business. Here's a hint, it's the same formula for choosing vendors and making capital purchases. It's also the very same formula that my customers use when they consider buying from me. Even a single person in my organization that doesn't fit that formula will cost me business through the loss of customers or not getting a customer we're going after. For me it works, for candidates looking for a career guidance councilor, it does not. In the capitalist economy my job is to make sure the lights are on, the products or services are good, and your paycheck clears. If you like me doing my job, then your job is to make me more money, keep my customers happy, and bring new customers to the company. Entry level doesn't do that so there are no entry level jobs in my company.\"" }, { "docid": "97044", "title": "", "text": "Personally the main disadvantages are perpetuation of the credit referencing system, which is massively abused and woefully under regulated, and encouraging people to think that it's ok to buy things you don't have the money to buy (either save up or question price/necessity)." }, { "docid": "596002", "title": "", "text": "This isn't an article discussing the business aspects of bitcoin. It's a comment on the price movement of bitcoin. Do we regularly comment about the gyrations of commodities and currencies on this thread? I tend to find talk of those things on subs like /r/finance and /r/investing." }, { "docid": "496159", "title": "", "text": "Okay, I think I managed to find the precise answer to this problem! It involves solving a non-linear exponential equation, but I also found a good approximate solution using the truncated Taylor series. See below for a spreadsheet you can use. Let's start by defining the growth factors per period, for money in the bank and money invested: Now, let S be the amount ready to be invested after n+1 periods; so the first of that money has earned interest for n periods. That is, The key step to solve the problem was to fix the total number of periods considered. So let's introduce a new variable: t = the total number of time periods elapsed So if money is ready to invest every n+1 periods, there will be t/(n+1) separate investments, and the future value of the investments will be: This formula is exact in the case of integer t and n, and a good approximation when t and n are not integers. Substituting S, we get the version of the formula which explicitly depends on n: Fortunately, only a couple of terms in FV depend on n, so we can find the derivative after some effort: Equating the derivative to zero, we can remove the denominator, and assuming t is greater than zero, we can divide by the constant ( 1-G t ): To simplify the equation, we can define some extra constants: Then, we can define a function f(n) and write the equation as: Note that α, β, γ, G, and R are all constant. From here there are two options: Use Newton's method or another numerical method for finding the positive root of f(n). This can be done in a number of software packages like MATLAB, Octave, etc, or by using a graphics calculator. Solve approximately using a truncated Taylor series polynomial. I will use this method here. The Taylor series of f(n), centred around n=0, is: Truncating the series to the first three terms, we get a quadratic polynomial (with constant coefficients): Using R, G, α, β and γ defined above, let c0, c1 and c2 be the coefficients of the truncated Taylor series for f(n): Then, n should be rounded to the nearest whole number. To be certain, check the values above and below n using the formula for FV. Using the example from the question: For example, I might put aside $100 every week to invest into a stock with an expected growth of 9% p.a., but brokerage fees are $10/trade. For how many weeks should I accumulate the $100 before investing, if I can put it in my high-interest bank account at 4% p.a. until then? Using Newton's method to find roots of f(n) above, we get n = 14.004. Using the closed-form approximate solution, we get n = 14.082. Checking this against the FV with t = 1680 (evenly divisible by each n + 1 tested): Therefore, you should wait for n = 14 periods, keeping that money in the bank, investing it together with the money in the next period (so you will make an investment every 14 + 1 = 15 weeks.) Here's one way to implement the above solution with a spreadsheet. StackExchange doesn't allow tables in their syntax at this time, so I'll show a screenshot of the formulae and columns you can copy and paste: Formulae: Copy and paste column A: Copy and paste column B: Results: Remember, n is the number of periods to accumulate money in the bank. So you will want to invest every n+1 weeks; in this case, every 15 weeks." }, { "docid": "251824", "title": "", "text": "To figure this out, you need to know the price per share then vs the price per share now. Google Finance will show you historical prices. For GOOG, the closing price on January 5, 2015 was $513.87. The price on December 31, 2015 was $758.88. Return on Investment (ROI) is calculated with this formula: ROI = (Proceeds from Investment - Cost of Investment) / Cost of Investment Using this formula, your return on investment would be 47.7%. Since the time period was one year, this number is already an annualized return. If the time period was different than one year, you would normally convert it to an annualized rate of return in order to compare it to other investments." }, { "docid": "90290", "title": "", "text": "I think you're making a mistake. If you still want to make this mistake (I'll explain later why I think its a mistake), the resources for you are: IRS.GOV - The IRS official web site, that has all the up-to-date forms and instructions for them, guiding publications and the relevant rules. You might get a bit overwhelmed through. Software programs - TurboTax (Home & Business for a sole propriator or single member LLC, Business for more complicated business), or H&R Block Business (only one version that should cover all) are for your guidance. They provide tips and interactive guidance in filling in all the raw data, and produce all the forms filled for you according to the raw data you entered. I personally prefer TurboTax, I think its interface is nicer and the workflow is more intuitive, but that's my personal preference. I wrote about it in my blog last year. Both also include plug-ins for the state taxes (If I remember correctly, for both the first state is included in the price, if you need more than 1 state - there's extra $30-$40 per state). Your state tax authority web site (Minnesota Department of Revenue in your case). Both Intuit and H&R Block have on-line forums where people answer each others questions while using the software to prepare the taxes, you might find useful information there. As always, Google is your friend. Now, why I think this is a mistake. Mistakes that you make - will be your responsibility. If you use the software - they'll cover the calculation mistakes. But if you write income in a wrong specification or take a wrong deduction that you shouldn't have taken - it will be on your head and you're the one to pay the fines and penalties for that. Missed deductions and credits - CPA's (should) know about all the latest deductions and credits that you or your business might be entitled to. They also (should) know which one got canceled and you shouldn't be continuing taking them if you had before. Expenses - there are plenty of rules of what can be written off as an expense and how. Some things should be written off this year, others over several years, for some depreciation formula should be used, etc etc. Tax programs might help you with that, but again - mistakes are your responsibility. Especially for the first time and for the newly formed business, I think you should use a (good!) CPA. The CPA should take responsibility over your filing. The CPA should provide guarantee that based on the documents you provided, he filled all the necessary forms correctly, and will absorb all the fees and penalties if there's an audit and mistakes were found not because you withheld information from your CPA, but because the CPA made a mistake. That costs money, and that's why the CPA's are more expensive than using a program or preparing yourself. But, the risk is much higher, especially for a new business. And after all - its a business expense." }, { "docid": "296146", "title": "", "text": "What's the future value of money given: M = initial investment R = additional monthly investment P = interest rate earned per month t = number of months This is the result of 2 formulas. 1. How much is the initial investment worth at the end + 2. How much are the additional contributions worth at the end. FutureValue[M] = M * (1+P)^t FutureValue[R] = annuity calculation = R*((1+P)^t-1)/P) So the future value of your initial investment with regular additions, all earning the same return monthly at the end of t months will be: M * (1+P)^t + R*((1+P)^t-1)/P)" }, { "docid": "588153", "title": "", "text": "A derivative is a financial instrument of a special kind, the kind “whose price depends on, or is derived from, another asset”. This definition is from John Hull, Options, Futures and Other Derivatives – a book definitely worth to own if you are curious about this, you can easily find old copies for a few dollars. The first point is that a derivative is a financial instrument, like credits, or insurances, the second point is that its price depends closely from the price of something else, the mentioned asset. In most cases derivatives can be understood as financial insurances against some risk bound to the asset. In the sequel I give a small list of derivatives and highlight the assets and the risk they can be bound to. And first, let me point out that the definition is (marginally) wrong because some derivatives depend on things which are not assets, nor do they have a price, like temperature, sunlight, or even your own life in the case of mortgages. But before going in this list, let me go through the remaining points of your question. What is the basic idea and concept behind a derivative? As already noted, in most cases, a derivative can be understood as a financial insurance compensating from a risk of some sort. In a classical insurance contract, one party of the contract is an insurance company, but in the broader case of a derivative, that counterparty can be pretty anything: an insurance, a bank, a government, a large company, and most probably market makers. How is it really used, and how does this deviate from the first point? Briefly, how does is it affecting people, and how is it causing problems? An important point with derivatives is that it can be arbitrarily complicated to compute their prices. Actually what is hidden in the attempt of giving a definition for derivatives, is that they are products whose price Y is a measurable function of one or several random variables X_1, X_2, … X_n on which we can use the theory of arbitrage pricing to get hints on the actual price Y of the asset – this is what the depends on means in technical terms. In the most favorable case, we obtain an easy formula linking Y to the X_is which tells us what is the price of our financial instrument. But in practice, it can be very difficult, if at all possible, to determine a price for derivatives. This has two implications: Persons possessing sophisticated techniques to compute the price of derivatives have a strategic advantage on derivatives market, in comparison to less advanced actors on the market. Organisation owning assets they cannot price cannot compute their bilan anymore, so that they cannot know for sure their financial situation. They are somehow playing roulette. But wait, if derivatives are insurances they should help to mitigate some financial risk, which precisely means that they should help their owners to more accurately see their financial situation! How is this not a contradiction? Some persons with sophisticated techniques to compute the price of derivatives are actually selling complicated derivatives to less knowledgeable persons. For instance, many communes in France and Germany have contracted credits whose reimbursements have a fixed interest part, like in a classical credit, and a variable interest part whose rate is computed against a complicated formula involving the value of the Swiss frank at each quarter starting from the inception of the credit. (So, for a 25 years running credit of theis type, the price Y of the credit at its inception depends on 100 Xs, which are the uncertain prices for the Swiss frank each quarter of the 25 next years.) Some of these communes can be quite small, with 5.000 inhabitants, and needless to say, do not have the required expertise to analyse the risks bound to such instruments, which in that special case led the court call the credit a swindling and to cancel the credit. But what chain of events leads a 5.000 inhabitants city in France to own a credit whose reimbursements depends on the Swiss frank? After the credit crunch in 2007 and the fall of Lehman Brothers in 2008, it has begun to be very hard to organise funding, which basically means to conclude credits running long in time on large amounts of money. So, the municipality needs a 25 years credit of 10.000.000 EUROS and goes to its communal bank. The communal bank has hundreds or thousands of municipalities looking for credits and needs itself a financing. So the communal bank goes to one of the five largest financial institutions in the world, which insists on selling a huge credit whose reimbursements have a variable part depending on hundred of values the Swiss frank will have in the 25 next years. Since the the big bank has better computation techniques than the small bank it makes a big profit. Since the small bank has no idea, how to compute the correct price of the credit it bought, it cuts this in pieces and sell it in the same form to the various communes it works with. If we were to attribute this kind of intentions to the largest five banks, we could ask about the possibility that they designed the credit to take advantage of the primitive evaluation methods of the small bank. We could also ask if they organised a cartel to force communal banks to buy their bermudean snowballs. And we could also ask, if they are so influent that they eventually can manipulate the Swiss frank to secure an even higher profit. But I will not go into this. To the best of my understanding, the subprime crisis is a play along the same plot, with different actors, but I know this latter subject only by what I could read in French newspapers. So much for the “How is it causing problems?” part. What is some of the terminology in relation to derivatives (and there meanings of course)? Answering this question is basically the purpose of the 7 first chapters of the book by Hull, along with deriving some important mathematical principles. And I will not copy these seven chapters here! How would someone get started dealing in derivatives (I'm playing a realistic stock market simulation, so it doesn't matter if your answer to this costs me money)? If you ask the question, I understand that you are not a professional, so that your are actually trying to become the one that has money and zero knowledge in the play I outlined above. I would recommand not doing this. That said, if you have a good mathematical background and can program well, once you are confindent with the books of Hull and Joshi, you can have fun implementing various market models and implementing trading strategies. Once you are confident with this, you can also read the articles on quantitative finance on arXiv.org. And once you are done with this, you can decide for yourself if you want to play the same market as the guys writing these articles. (And yes, even for the simplest options, they have better models than you have and will systematically outperform you in the long run, even if some random successes will give you the feeling that you do well and could do better.) (indeed, I've made it a personal goal to somehow lose every last cent of my money) You know your weapons! :) Two parties agree today on a price for one to deliver a commodity to the other at some future instant. This is a classical future contract, it can be modified in every imaginable way, usually by embedding options. For instance one party could have the option to choose between different delivery points or delivery days. Two parties write today a contract allowing the one party to buy at some future time a commodity to the the second party. The price is written today, as part of the contract. (There is the corresponding option entitling the owner to sell something.) Unlike the future contract, only one party can be obliged to do something, the other jas a right but no obligation. If you buy and option, your are buying some sort of insurance against a change of price on some asset. This is the most familiar to anybody. Credits can come in many different flavours, especially the formula to compute interests, or also embed options. Common options are early settlement options or restructuration options. While this is not completely inutitive, the credit works like an insurance. This is most easily understood from the side of the organisation lending the money, that speculates that the ratio of creanciers going bankrupt will be low enough for her to make profit, just like a fire insurance company speculates that the ratio of fire accidents will be low enough for her to make a profit. This is like a mortgage on a financial institution. Two parties agree that one will recive an upfront today and give a compensation to the second one if some third party defaults. Here this is an explicit insurance against the unfortuante event, where a creancier goes bankrupt. One finds here more or less standard options on electricity. But electricity have delicious particularities as it can practically not be stored, and fallout is also (usually) avoided. As for classical options, these are insurances against price moves. A swap is like two complementary credits on the same amount of money, so that it ends up in the two parties not actually exchanging the credit nominal and only paying interest one to the other — which makes only sense if these interests are computed with different formulas. Typical example are fixed rate vs. EURIBOR on some given maturity, which we interpret as an insurance against fluctuations of the EURIBOR, or a fixed rate vs. the exchange ratio between two currencies, which we interpret as an insurance against the two currencies decorrelating. Swaps are the richest and the most generic category of financial derivatives. The off-the-counter market features very imaginative, very customised insurance products. The most basic form is the insurance against drought, but you can image different dangers, and once you have it you can put it in options, in a swap, etc. For instance, a restaurant with a terrasse could enter in a weather insurance, paying each year a fixed amount of money and becoming in return an amount of money based on the amount of rainy day in a year. Actually, this list is virtually without limits!" }, { "docid": "320442", "title": "", "text": "\"The way to resolve your dilemma is to consult the price-to-rent ratio of the property. According to smartasset.com: The price-to-rent ratio is a measure of the relative affordability of renting and buying in a given housing market. It is calculated as the ratio of home prices to annual rental rates. So, for example, in a real estate market where, on average, a home worth $200,000 could rent for $1000 a month, the price-rent ratio is 16.67. That’s determined using the formula: $200,000 ÷ (12 x $1,000). Smartasset.com also goes on to give a table comparing different cities' price-to-rent ratio and then claim that the average price-to-rent ratio is currently 19.21. If your price-to-rent ratio is lower than 19.21, then, yes, your rents are more expensive than the average house. Smartasset.com claims that a high price-to-rent ratio is an argument in favor of tenants \"\"renting\"\" properties while a low price-to-rent ratio favors people \"\"buying\"\" (either to live in the property or to just rent it out to other people). So let's apply the price-to-rent ratio formula towards the properties you just quoted. There's a specific house I could buy for 190 (perhaps even less) that rents for exactly 2000 / month. 190K/(2000 * 12) = 7.92 There's a house for sale asking 400 (been on the market 2 yrs! could probably get for 350) which rents for 2800 /month. (400K)/(2800*12) = 11.90 (350K)/(2800*12) = 10.42 One can quite easily today buy a house for 180k-270k that would rent out for 1700-2100 / month. Lower Bound: (180K)/(1700*12) = 8.82 Upper Bound: (270K)/(2100*12) = 10.71 Even so, the rental returns here seem \"\"ridiculously high\"\" to me based on other markets I've noticed. Considering how the average price-to-rent ratio is 19.21, and your price-to-rent ratio ranges from 7.92 to 11.90, you are indeed correct. They are indeed \"\"ridiculously high\"\". Qualification: I was involved in real estate, and used the price-to-rent ratio to determine how long it would take to \"\"recover\"\" a person's investment in the property. Keep in mind that it's not the only thing I care about, and obviously the price-to-rent ratio tends to downplay expenses involved in actually owning properties and trying to deal with periods of vacancy. There's also the problem of taking into account demand as well. According to smartasset.com, Detroit, MI has the lowest price-to-rent ratio (with 6.27), which should suggest that people should buy properties immediately in this city. But that's probably more of a sign of people not wanting to move to Detroit and bid up the prices of properties. EDIT: I should also say that just because the properties are \"\"ridiculously expensive\"\" right now doesn't mean you should expect your rents to decrease. Rather, if rents keep staying at their current level, I'd predict that the property values will slowly increase in the future, thereby raising the price-to-rent ratio to 'non-ridiculous' mode.\"" }, { "docid": "130285", "title": "", "text": "\"Sure, and everything you've said here is absolutely true for a fully immunized portfolio. What the OP suggests is that it's simply impossible to effectively defease future obligations. He is pitching not so much finance as he is a political philosophy that can be summed up by \"\"defined benefit plans are impediments to competition.\"\" In the OP's world, the business of life and casualty insurance would implode within a few years of inception. Actuarial science would be dismissed as mathematical witchcraft. We would see company after company laid low by overwhelming future obligations against which they have no defense. Rather, what we have are instances of *poor financial management.* As opposed to the fine examples set by insurers, endowments, foundations, etc. (all of which can remain successful ongoing concerns in perpetuity), what we have are businesses who decided that it would be better to cut corners and bet on risk, rather than to take the safer (but more expensive) route and effectively manage their assets in relation to their liabilities. He then goes on to suggest that, in laying off their problems, business are simply \"\"doing everybody a favor.\"\" These business (and their highly educated financial managers) are taking their flaming piles of shit, handing it over to the guy whose expertise most likely involves the repetitive operation of a machine, and saying \"\"here you go, this is a good deal for you, enjoy managing your future!\"\"\"" } ]

[ { "docid": "523431", "title": "", "text": "\"If you're a US citizen, money earned while in the US is sourced to the US. So you can't apply FTC/FEIE to the amounts attributable to the periods of your work while in the US even if it is a short business trip. Tax treaties may affect this. Most tax treaties have explicit provisions to exclude short trips from the sourcing rules, however due to the \"\"saving clause\"\" these would probably not apply to you if you're a US citizen - you'll need to read the relevant treaty. Your home country should allow credit for the US taxes paid on the US-sourced income, and the double-taxation avoidance provision should apply in this case. The technicalities depend on your specific country. You would probably not just remove it from the taxable income, there probably is a form similar to the US form 1116 to calculate the available credit.\"" } ]

[ { "docid": "12906", "title": "", "text": "\"If you are a resident of New Zealand for tax purposes, you will be taxed in New Zealand on all of your \"\"worldwide income\"\". This is income derived from New Zealand as well as income derived from all other countries Source: http://www.ird.govt.nz/international/nzwithos/income/overseas-income-index.html Another link that will be of use is this: https://www.ato.gov.au/individuals/international-tax-for-individuals/work-out-your-tax-residency/ This is Australia's rules on if you qualify as a resident for tax purposes. I am not an accountant or a lawyer but my reading of this is you actually have to reside in Australia to be considered a resident - whether or not you have a bank account there doesn't appear to play into it. Additionally, Australia and NZ have a \"\"double taxation agreement\"\", explained here: http://www.ird.govt.nz/yoursituation-nonres/double-tax/ So this should prevent you from being taxed in both places.\"" }, { "docid": "372744", "title": "", "text": "If you want to prove the actual tax liability you have in the US - you have to file a tax return. If the Romanian government believes you that the withholding is your actual tax - fine, but that would be a lie. Withholding is not a tax. The American payers must withhold from foreigners enough to have transferred more than the actual tax the foreigners would have paid. The standard withholding is 30%, but the actual tax on dividends varies. In case the tax treaty limits the tax on dividends - the withholding is usually up to the maximum of the tax allowed by the treaty. But allowed doesn't mean that would be the actual tax. In many cases it is not. So if you want to claim the US tax paid as a credit towards your Romanian tax - you'll need to file a tax return in the US, calculate the actual tax liability and that would be the amount of credit you can claim. The difference between that amount and the amount withheld by the payer will be refunded to you by the IRS. You don't have to file a US tax return, that is true. But the withholding is not the tax, the actual tax liability may have been less, and the Romanian tax authority may deny your credit, in whole or in part, based on the fact that you haven't filed a US tax return and as such have no proof of your actual tax paid. You had some experience with the UK tax treaty, and you think all the treaties are the same. That may be a reasonable line of thought, but it is incorrect. Treaties are not the same. More importantly, even if the treaty is the same - the tax law is not. While in the UK the tax on dividends may be flat and from the first pound - in the US it is neither flat nor from the first dollar. Thus, while in the UK you may have been used to paying tax at source and that's it - in the US it doesn't work that way at all." }, { "docid": "53434", "title": "", "text": "\"Well, perhaps \"\"have a dedicated tax advisor\"\" is an answer then. I wouldn't have thought of this, as it's not specifically about taxation, is it? Or more broadly \"\"consult with a dedicated professional for the situation in detail\"\"... Yes, that is the only real answer you can get. Anything else will vary between highly localized to entirely incorrect. Pensions are rarely defined benefit anymore, and not many countries still keep state-sponsored defined benefit pension plans. For most, what's left is Social Security system, which is in no way a pension. This is an insurance, and is paid as tax which is rarely refundable (but you won't always have to pay it if you're a foreigner in the country). Usually, Social Security benefits are only available to citizens and (/or, in some rare cases) residents of that country. So it is unlikely (although possible) that you'll benefit from social security payments of more than one country. Some countries have totalization treaties that make your social security payments in one count in the other. If you're in a country that has such an agreement with the Netherlands - you're lucky. Your personal pension savings are basically tax-deferred investment accounts. But tax deferral in one country doesn't necessarily work in another. In the US you have 401k or IRA accounts, but in your own country they may very well be taxable. So you gain the tax deferral in the US, but if your own country taxes them - you lost the benefit, and you will still have to abide by the US tax rules when taking the money out. If you don't plan properly you can easily be hit by double taxation in such cases. Bottom line, you need to plan your pension savings on your own, privately, with a good and solid tax advice (and pension planning advice) that would be relevant to all the countries that you are tax resident at at any given time (you can easily be resident for tax purposes in more than one country). These advisers have to take into account the laws of the countries involved, the tax treaties between themselves and between them and the country of your citizenship, and the future countries you're planning on visiting or getting old at. Its complicated, and most likely you won't be able to predict everything, especially because the laws and treaties tend to change over time.\"" }, { "docid": "332626", "title": "", "text": "\"The IRS taxes worldwide income of its citizens and green card holders. Generally, for those Americans genuinely living/working overseas the IRS takes the somewhat reasonable position of being in \"\"2nd place\"\" tax-wise. That is, you are expected to pay taxes in the country you are living in, and these taxes can reduce the tax you would have owed in the USA. Unfortunately, all of this has to be documented and tax returns are still required every year. Your European friends may find this quite surprising as I've heard, for instance, that France will not tax you if you go live and work in Germany. A foreign company operating in a foreign country under foreign law is not typically required to give you a W-2, 1099, or any of the forms you are used to. Indeed, you should be paying taxes in the place where you live and work, which is probably somewhat different than the USA. Keep all these records as they may be useful for your USA taxes as well. You are required to total up what you were paid in Euros and convert them to US$. This will go on the income section of a 1040. You should be paying taxes in the EU country where you live. You can also total those up and convert to US$. This may be useful for a foreign tax credit. If you are living in the EU long term, like over 330 days/year or you have your home and family there, then you might qualify for a very large exemption from your income for US tax purposes, called the Foreign Earned Income Exclusion. This is explained in IRS Publication 54. The purpose of this is primarily to avoid double taxation. FBAR is a serious thing. In past years, the FBAR form went to a Financial Crimes unit in Detroit, not the regular IRS address. Also, getting an extension to file taxes does not extend the deadline for the FBAR. Some rich people have paid multi-million dollar fines over FBAR and not paying taxes on foreign accounts. I've heard you can get a $10,000 FBAR penalty for inadvertent, non-willful violations so be sure to send those in and it goes up from there to $250k or half the value of the account, whichever is more. You also need to know about whether you need to do FATCA reporting with your 1040. There are indeed, a lot of obnoxious things you need to know about that came into existence over the years and are still on the law books -- because of the perpetual 'arms race' between the government and would be cheaters, non-payers and their advisors. http://www.irs.gov/publications/p54/ http://americansabroad.org/\"" }, { "docid": "561695", "title": "", "text": "\"The short answer is that there is no US tax due if all you are doing is moving assets held abroad to the US. Whether you are a \"\"returning\"\" US citizen (or will continue your residence in the Philippines) is not relevant to this. The long answer is that you may be liable for a lot of other fines and taxes if you have not been doing any of several things correctly. As a US citizen, you are required to declare your worldwide income on your US income tax returns. Have you been filing US income tax returns during your time abroad? and have you been declaring the income that you have received from non-US sources each year? This includes wages, interest, dividends, capital gains, rental income from real estate, gambling income, lottery winnings, Nobel prizes, everything. If you have been paying income tax to other countries on this income, then it is generally possible to get a deduction for this tax payment from the income that will be taxed by the US (or a credit for the tax payment against your US Federal income tax liability) depending on the existence of tax treaties or (when the US Senate refuses to approve a tax treaty) a Double Taxation Avoidance Agreement between the US and other countries. In some cases, foreign earned income up to a certain limit is not taxed by the US at all. Even if you have been filing US income tax returns correctly, and can thus account for the $45,000 in your savings account, or you received that money as a gift or inheritance and can account for it on that basis, have you been filing reports with the US Treasury since the year when the total value of all your foreign bank accounts and other financial assets (stocks and bonds etc but not real estate) first exceeded $10,000? In prior years, this was a matter of filling out and submitting Form TD F 90-22.1 but more recently (since 2010?), you need to fill out and submit FinCEN Form 114. Have you been submitting the required documentation all along? Note that there are severe penalties for failure to fine FinCEN Form 114, and these penalties do not get waived by tax treaties. In summary, you might (or you might not) have several other tax or legal issues to worry about than just taxes on the transfer of your money from the Philippines to the US.\"" }, { "docid": "454563", "title": "", "text": "If you are tax-resident in the US, then you must report income from sources within and without the United States. Your foreign income generally must be reported to the IRS. You will generally be eligible for a credit for foreign income taxes paid, via Form 1116. The question of the stock transfer is more complicated, but revolves around the beneficial owner. If the stocks are yours but held by your brother, it is possible that you are the beneficial owner and you will have to report any income. There is no tax for bringing the money into the US. As a US tax resident, you are already subject to income tax on the gain from the sale in India. However, if the investment is held by a separate entity in India, which is not a US domestic entity or tax resident, then there is a separate analysis. Paying a dividend to you of the sale proceeds (or part of the proceeds) would be taxable. Your sale of the entity containing the investments would be taxable. There are look-through provisions if the entity is insufficiently foreign (de facto US, such as a Subpart-F CFC). There are ways to structure that transaction that are not taxable, such as making it a bona fide loan (which is enforceable and you must pay back on reasonable terms). But if you are holding property directly, not through a foreign separate entity, then the sale triggers US tax; the transfer into the US is not meaningful for your taxes, except for reporting foreign accounts. Please review Publication 519 for general information on taxation of resident aliens." }, { "docid": "417208", "title": "", "text": "\"I'll add a bit to Paul's excellent write up. Foreign Earned Income Exclusion (form 2555): notice the earned there. It doesn't exclude capital gains, interest, dividends, and basically everything that is not salary. You pay US taxes on it from the first cent. Foreign tax credit - foreign tax credit (form 1116) doesn't reduce your US tax dollar for dollar (even though it may appear that it does from the generic explanations). By using this form you may end up accumulating unused credit while still paying double taxes at the same time. Happened to me. Thank Congress for the logical and reasonable US tax laws. New FATCA form 8938: as opposed to FBAR (that goes to the FinCEN in the Treasury), this one goes to the IRS. it contains very similar info, but the threshold requirements are different. You may have to file FBAR, but not these, or you may have to file both. Being an American citizen, some European banks will refuse to provide services to you. Again, thank Congress for FATCA. It requires foreign banks to enforce US tax regulations on US citizens, and banks that won't will get penalized in the US. Many banks refuse to provide services to Americans because of that because what IRS requires is illegal in most countries. Some countries (like UK and some other EU countries) have signed treaties with the US to resolve this, but many haven't. Currency conversion - as I commented to Paul, you convert the amounts when you receive them, which may have your fixed EUR salary be converted to different dollar amounts every time. You need to make sure you do it right. Pensions, savings, investments - if you're doing these in non-US instruments prepare to be penalized. US taxes foreign investments much more aggressively than domestic. If you're investing in indexes/mutual funds, or you're a principle in a corporation, or you create a pension account - you'll get hit by additional reporting requirements and tax. Tax treaties - the US has tax treaties with many EU countries, and equalization treaties with some. The tax treaties affect the standard tax treatment by the US and some of the \"\"generic\"\" info you got here may not apply because of a tax treaty, and some other rules may apply. Equalization treaties work similarly with regards to the Social Security. Bottom line, and I know Paul disagrees with me on this - talk with a US-licensed adviser in the country you're going to. It is very important for your tax adviser to know the relevant treaty (and not read it the first time when you call him), and to understand each and every financial instrument in your country. Missing piece of paper in your tax return can cost you thousands of dollars in penalties (not exaggerating, not filing form 3520 triggers a $10000 penalty, even if there's no tax) and additional taxes.\"" }, { "docid": "235470", "title": "", "text": "how is it double taxation when you didn't start off with that extra $100? it's double taxation if they taxed you on the total amount you pulled out of the market, not the profit you made. explain the math on your last part, please." }, { "docid": "472681", "title": "", "text": "India and the United States have a tax treaty agreement whereby double taxation is avoided. However check with your accountant in the US who should be able to guide you further in this regard. It is now easier to transfer money out of India. As long as the source of the money is legal and can be verified. So if you decide to sell a property, get payments by way of documented bank transactions like cheques and avoid cash deals. Once taxes are paid money can usually be transferred out." }, { "docid": "509346", "title": "", "text": "What do you think of the argument that corporations shouldn't pay any tax, since investors pay tax on the dividends, and if the corporations paid too, that would be double taxation? Of course, not all corporate income goes to pay dividends. Much of the rest is deducted as business expense. Is there some corporate income which should properly be taxed?" }, { "docid": "440774", "title": "", "text": "Yes, that is correct. Note, when there is a tax treaty between Canada and the other country -- [which is pretty much anywhere you have active business](http://www.fin.gc.ca/treaties-conventions/in_force--eng.asp) -- the tax credits are equal to the income received, making it tax free. Here is a better explanation: > The greatest advantage of having a foreign affiliate in the international business setting is to repatriate foreign profits back to Canada tax free under certain conditions, for example, if a foreign affiliate carries on an active business in a designated treaty country (i.e. a country with which Canada has a tax treaty). The after-tax profit is included in a pool called “exempt surplus”. If the repatriation of profit in the form of dividend was paid out of the “exempt surplus” pool to a Canadian corporate shareholder, such dividend is included in its income and the same amount is allowed to be deducted in computing its taxable income. In other words, the dividend is not subject to Canadian tax if received by a Canadian corporate shareholder. [Source, p3](http://www.canadataxplan.com/test/canadataxplan/files/Book%20-%20English_summary_12-22-2008.pdf) Edit... here from the NRC site: > Treaty Countries: **Active business income earned in a treaty country is classified as “exempt surplus.”** The exempt surplus of an FA also includes inter-affiliate dividends received out of the exempt surplus of other foreign affiliates, the exempt portion (25%) of all capital gains, and certain taxable capital gains. **Dividends paid out of the exempt surplus of an FA can be received free of additional taxes in Canada**, since the profits out of which they are paid are considered to have borne a rate of tax in the treaty country comparable to that of Canada. [Source](http://www.nrcan.gc.ca/mining-materials/taxation/8880) see the section on Subsidiary Income. This is the reason BK is moving to Canada. [Also here is a very interesting deck on corporate tax minimization in latin america by the Canadian mining industry.](http://miningtaxcanada.com/wp-content/uploads/2010/05/TOR01-5160395-v1-RMLF_Cartagena_Slides.pdf)" }, { "docid": "375748", "title": "", "text": "Hence new employer pays a part of the salary as per diem compensation along with regular salary and says that per-diem compensation is non-taxable. Per-diem is not taxable. But that is not what you're describing. It appears that either you or the prospective employer, misunderstood what per-diem is. As per US law is it legally allowed non taxable per diem compensation to employees? Yes. What are the pros and cons of having per diem compensation? Per-diem is not compensation. It is not part of your salary. It is not part of your employment contract. If I have to report my salary to any one like banks, insurance companies, do I need to include Per diem compensation or not? No, because it is not compensation. Back to the first item: Per-diem is paid to you during business trips when you're away from your (tax) home. It is not part of your compensation, and is only allowed for business trips. Contract work on site for any prolonged period of time (1 year or more, as a definitive rule, but can be less) is not a business trip. For that period of time your tax home becomes that location, so you're not away. You're home. You should discuss it with a licensed tax adviser (EA/CPA licensed in your State), but it seems to me that either you misunderstood something, or your prospective employer is trying to evade taxes (both yours and his) by disguising part of your compensation as per-diem. It is very likely that when you get caught, the employer will just issue you 1099 on the amounts and leave you hanging." }, { "docid": "459953", "title": "", "text": "As far as I read in many articles, all earnings (capital gains and dividends) from Canadian stocks will be always tax-free. Right? There's no withholding tax, ie. a $100 dividend means you get $100. There's no withholding for capital gains in shares for anybody. You will still have to pay taxes on the amounts, but that's only due at tax time and it could be very minor (or even a refund) for eligible Canadian dividends. That's because the company has already paid tax on those dividends. In contrast, holding U.S. or any foreign stock that yields dividends in a TFSA will pay 15% withholding tax and it is not recoverable. Correct, but the 15% is a special rate for regular shares and you need to fill out a W8-BEN. Your broker will probably make sure you have every few years. But if you hold the same stock in a non-registered account, this 15% withholding tax can be used as a foreign tax credit? Is this true or not or what are the considerations? That's true but reduces your Canadian tax payable, it's not refundable, so you have to have some tax to subtract it from. Another consideration is foreign dividends are included 100% in income no mater what the character is. That means you pay tax at your highest rate always if not held in a tax sheltered account. Canadian dividends that are in a non-registered account will pay taxes, I presume and I don't know how much, but the amount can be used also as a tax credit or are unrecoverable? What happens in order to take into account taxes paid by the company is, I read also that if you don't want to pay withholding taxes from foreign > dividends you can hold your stock in a RRSP or RRIF? You don't have any withholding taxes from US entities to what they consider Canadian retirement accounts. So TFSAs and RESPs aren't covered. Note that it has to be a US fund like SPY or VTI that trades in the US, and the account has to be RRSP/RRIF. You can't buy a Canadian listed ETF that holds US stocks and get the same treatment. This is also only for the US, not foreign like Europe or Asia. Also something like VT (total world) in the US will have withholding taxes from foreign (Europe & Asia mostly) before the money gets to the US. You can't get that back. Just an honourable mention for the UK, there's no withholding taxes for anybody, and I hear it's on sale. But at some point, if I withdraw the money, who do I need to pay taxes, > U.S. or Canada? Canada." }, { "docid": "348799", "title": "", "text": "No he's arguing for a lower US Corporate tax rate specifically on overseas earnings. Because companies are earning overseas and not taking it back to the US because of our double taxation. He absolutely does not want higher taxes" }, { "docid": "344290", "title": "", "text": "foreign income, transfer it to my savings account in India Yes you can transfer to India. The right account would be NRO/NRE. As an NRI one should not hold a regular savings account. forum that foreign income is not taxable unless used to buy stocks, fds etc If you are an NRI, income earned outside of India is not taxable in India. However any income you generate in India is taxable, i.e. interest income, gains from shares etc. Do we need to pay taxes for the money transferred No tax if you are an NRI even if you transfer funds to India. Taxation does not depend on whether or not you transfer the money, it depends on your status used to pay home EMIs or principle amount? You can use the money for what ever you like." }, { "docid": "495827", "title": "", "text": "\"Its not for US citizens - its for US residents. If the US considers you as a tax resident - you'll be treated the same as a US citizen, regardless of your immigration status. The question is very unclear, since it is not mentioned whether your US sourced income \"\"from the Internet\"\" is sales in the US, sales on-line, services you provide, investments, or what else. All these are treated differently. For some kinds of US-sourced income you should have paid taxes in the US already, regardless of where you physically reside. For others - not. In any case, if you become US tax resident, you'll be taxed on your worldwide income, not only the $10K deposited in the US bank account. ALL of your income, everywhere in the world, must be declared to the US government and will be taxed. You should seek professional advice, before you move to the US, in order to understand your responsibilities, liabilities and rights. I suggest looking for a EA/CPA licensed in California and experienced with taxation of foreigners (look for someone in the SF or LA metropolitan areas). Keep in mind that there may be a tax treaty between the US and your home country that may affect your Federal (but not California) taxes.\"" }, { "docid": "40322", "title": "", "text": "As an American living in Canada, you don't get it. The USA wants all of us expats to pay taxes twice. No other country but one does that. If the USA would follow the rest of the world and not tax profits again after being taxed abroad, these companies wouldn't leave. We could be having a better conversation here, but it's meaningless buzzwords of patriotism and boycotting. Burger King will have growth and profit internationally. It makes more sense for them to focus on that. If they end up with 20% of their profit from the USA, why would they pay 120% taxes? Obviously it's not quite as simple as that, but you get the general idea. The last thing our politicians want is us talking about eliminating double taxation. Just as you can't be tried for the same crime twice, you should not be taxed twice. When BK pays local taxes in whatever country they're in, whether it's lower or higher than the US is irrelevant. Taxes have been paid. End of story. Doesn't matter if it's a lower rate or creative accounting. It's done." }, { "docid": "185384", "title": "", "text": "Technically, if you earn in US (being paid there, which means you have a work visa) and live in other country, you must pay taxes in both countries. International treaties try to decrease the double-taxation, and in this case, you may pay in your country the difference of what you have paid in US. ie. your Country is 20% and USA is 15%, you will pay 5%, and vice-versa. This works only with certain areas. You must know the tax legislation of both countries, and I recommend you seek for advisory. This site have all the basic information you need: http://www.irs.gov/Individuals/International-Taxpayers/Foreign-Earned-Income-Exclusion Good luck." }, { "docid": "309684", "title": "", "text": "See if there are any favorable tax treaties between your two countries. (check US state department - or find the nearest PWC, Deloitte, KPMG, these are global auditing firms that deal with international tax and compliance) A tax treaty could have possible goodies such as a lower more favorable tax or even a tax credit from. For instance, if you paid 28% tax in the US then your new country will give you a credit on the taxes owed to them. The point of tax treaties are to prevent double taxation, but in the effort to do so they often create their own new tax rates for transfers between countries. You'll be better off just paying the 28% US income tax on your 401k distribution. And using the post-tax money as you please. US citizens are on the hook for income tax several years after they leave the US." } ]

[ { "docid": "465787", "title": "", "text": "Read the Forbes article titled IRA Adventures. While it's not the detailed regulations you certainly need, the article gives some great detail and caution. You may be able to do what you wish, but it must be structured to adhere to specific rules to avoid self dealing. Those rules would be known by the custodians who would help you set up the right structure, it's well buried within IRS regs, I'm sure. Last, in general, using IRA funds to invest in the non-traditional assets adds that other layer of risk, that the investment will be deemed non-allowed and/or self-dealing. So, even if you have the best business idea going, be sure you get proper council on this." } ]

[ { "docid": "412", "title": "", "text": "The details of the 401(k) are critical to the decision. A high cost (the expenses charged within the) 401(k) - I would deposit only to the match, and I'd be sure to get the entire match offered. In which case, that $3000 might be good to have available if you start out with a tight budget. Low cost 401(k) w/match - a no-brainer, deposit what you can afford. Roth 401(k) w/match - same rules for expenses apply, with the added note to use Roth when getting started and in a lower bracket. Yes, it makes sense to have both. You should note, depositing to the Roth now is riskless. The account, not the investment. If you decide next year you didn't want it, you can withdraw the deposit with no penalty or tax. Edit to respond to updated question - there are two pieces to the Roth deposit issue. The deposit itself, which puts the $3000 earned income into tax sheltered account, and the choice to invest. These two are sequential and you can take your time in between. I'm not sure what you mean by the dividend timing. In an IRA or 401(k) the dividend isn't taxed, so it's a non-issue. In a cash account, you might quickly have a small tax issue, but this doesn't come into the picture in the tax deferred accounts." }, { "docid": "292937", "title": "", "text": "A rollover IRA is a traditional IRA. Your rollover contributions are not taxed and rollover or counted against your annual limit, which is income dependent. A Roth IRA is one where your contributions will be taxed going into the IRA. Note that there are adjusted gross income maximums for contribution to a Roth IRA (see here), and as far as I can tell those income maximums also determine whether or not you can rollover to a Roth IRA." }, { "docid": "248536", "title": "", "text": "According to the IRS, you can still put money in your IRA. Here (https://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-IRA-Contribution-Limits) they say: Can I contribute to an IRA if I participate in a retirement plan at work? You can contribute to a traditional or Roth IRA whether or not you participate in another retirement plan through your employer or business. However, you might not be able to deduct all of your traditional IRA contributions if you or your spouse participates in another retirement plan at work. Roth IRA contributions might be limited if your income exceeds a certain level. In addition, in this link (https://www.irs.gov/Retirement-Plans/IRA-Deduction-Limits), the IRS says: Retirement plan at work: Your deduction may be limited if you (or your spouse, if you are married) are covered by a retirement plan at work and your income exceeds certain levels. The word 'covered' should clarify that - you are not covered anymore in that year, you just got a contribution in that year which was triggered by work done in a previous year. You cannot legally be covered in a plan at an employer where you did not work in that year." }, { "docid": "144824", "title": "", "text": "There are not as many options here as you fear. If you have no other investments outside this 401K it is even easier. Outside accounts include IRA, Roth IRA, taxable investments (mutual funds, ETF, individual stocks), Employee stock purchase plans. Amount: make sure you put enough in to get all the company match. I assume that in your case the 9% will do so, but check your documents. The company match will be with pre-tax funds. Roth vs Regular 401K? Most people in their lifetime will need a mix of Roth and Regular retirement accounts. You need to determine if it is better for you to pay the tax on your contributions now or later. Which accounts? If you are going to invest in a target date fund, you can ignore the rest of the options. The target date fund is a mixture of investments that will change over the decades. Calculate which one fits your expected retirement date and go with it. If you want to be able to control the mix, then you will need to pick several funds. The selection depends on what non-401K investments you have. Now here is what I considered the best advice. Decide Roth or regular, and just put the money into the most appropriate target date fund with the Roth/regular split you want. Then after the money starts flowing into your account, research the funds involved, the fees for those funds, and how you want to invest. Then move the money into the funds you want. Don't waste another day deciding how to invest. Just get started. The best part of a 401K, besides the match, is that you can move money between funds without worrying about taxes. If you realize that you want to put extra emphasis on the foreign stocks, or Mid-cap; just move the funds and redirect future contributions." }, { "docid": "599757", "title": "", "text": "What is the goal of the money? If it is to use in the short term, like savings for a car or college, then stick it in the bank and use it for that purpose. If you really want this money to mean something, then in my opinion you have only one choice: Open a ROTH IRA with something like Vanguard or Fidelity and invest in an index fund. Then do something that will be very difficult: Don't touch it. By the time you are 65, it will grow to about 60,000. However, assuming a 20% tax bracket, the value of that money is really more like 75,000. Clearly this will not make or break you either way. The way you live the rest of your life will have far more of an impact. It will get you started on the right path. BTW this is advice I gave my son who is about your age, and does not earn a ton of money as a state trooper. Half of his overtime pay goes into a ROTH. If he lives the rest of his life like he does now, he will be a wealthy man despite making an average income. No debt, and investing a decent portion of his pay." }, { "docid": "185047", "title": "", "text": "Why would someone invest in other instruments (e.g. stocks) to pay for childrens' college education when the capital gains on those are taxed, unlike a home equity loan? Many tax advantageous vehicles exist for the purpose of saving for college education such as 529 plans, Roth IRAs, Series EE and I bonds. Tax and penalty free distributions from a portfolio of stocks is possible if the distributions are for qualified education expenses and the account is in the form of a Roth IRA. A house is collateral for a home equity line of credit. A combination of unfortunate events could cause someone to default on the loan and loose their residence. Also, the tax advantages of 529 plans, and Roth IRAs are not applicable to purchase a motor boat. With respect, some people like to leave the home equity loan untapped for other uses. More Details: 529 plans are not taxed by on the Federal level when the withdraws are used for college. In many states, contributions to state sponsored 529 plans are deductible on the state level. These are not self directed so you can't trade stocks/bonds in a 529 plan, however, certain plans allow you to lock in the rate you pay for credit at today's prices. If you want a self directed (ability to trade stocks/bonds) vehicle with tax free disbursements for qualified education, consider a Roth IRA. There are yearly contribution limits, and penalty if the proceeds are not used for qualified educational expenses. Also I believe interest revenue from Series EE and I bonds is tax free if the bond is used for education. There are special conditions and situations to 529 plans, Roth IRAs, Series EE and I bonds, the purpose of this answer was to expand upon the tax advantageous vehicles for higher education." }, { "docid": "303416", "title": "", "text": "In general, Roth IRAs, are associated with the individual. Unlike 401(k)s for which the business holds the retirement account in the name of the individual. So, although the company may have helped you set up the Roth it is in your name and you can continue to contribute to it. Wikipedia has some helpful information here. It should be noted, however, that sometimes businesses set up special deals with retirement service companies or brokers that hold Roth IRAs so you should check with the particular company/broker that holds your Roth." }, { "docid": "119051", "title": "", "text": "You must file as married for 2013 if you were married as of December 31, 2013. It is true that the Roth IRA contribution phaseout for Married Filing Separately is 0 - $10K. But you can still do backdoor Roth IRA contribution (contribute to a Traditional IRA, then convert it to a Roth IRA; assuming you do not have any pre-tax IRAs, this is identical to a Roth IRA contribution). But you already made a Roth IRA contribution for 2013, and did not do the backdoor. Let's assume that you want to turn it into a backdoor Roth IRA contribution, and that you don't have any pre-tax IRAs. There are two ways to do this: Withdraw the Roth IRA you contributed (including earnings). Then, do a normal backdoor Roth IRA contribution (contribute to a Traditional IRA, then immediately convert it to Roth IRA). The earnings you had in the Roth IRA that you withdrew will be treated as normal income and taxed. The conversion will not be taxable because all of the Traditional IRA was non-deductible when you converted. Re-characterize your original Roth IRA contribution as a Traditional IRA contribution, then convert it to Roth IRA. It will be treated as if you made a Traditional IRA contribution originally, and then waited until now to convert. The earnings in the IRA up till now will be taxed on conversion. So in both cases, you will need to pay income tax on the earnings in the account up to now. The difference between the two is in the amount of money in the IRA now. With the first way, you can only contribute $5500 now. With the second way, you will keep the same amount of money you have in the IRA now." }, { "docid": "484904", "title": "", "text": "\"Let me start with something you might dismiss as trite - Correlation does not mean Causation. A money manager charging say, 1%, isn't likely to take on clients below a minimum level. On the other hand, there's a long debate regarding how, on average, managed funds don't beat the averages. I think that you should look at it this way. People that have money tend to be focused on other things. A brain surgeon making $500K/yr may not have the time, nor the inclination to want to manage her own money. I was always a numbers person. I marveled at the difference between raising 1.1 to the 40th power, getting 45.3 (i.e. Getting 45.3 times your investment after 40 years at 10%) vs 31.4 at 9%. That 1% difference feels like nothing, but after a lifetime, 1/3 of your money has been skimmed off the top. the data show that one can do better by simply putting their money into a mix of S&P index and cash, and beat the average money manager over time, regardless of convoluted 12 asset class allocations. Similarly - There are people who use a 'tax guy.' In quotes because I mean this as an individual whom they go to, year after year, not a storefront. My inlaws used to go to one, and I was curious what they got for their money. Each year he sent them a form. 3 pages they needed to fill in. Every cell made its way into the guy's tax program. The last year, I went with them to pick up the tax return. I asked him if he noticed that they might benefit from small Roth conversions each year, or by making some of their IRA RMD directly to charity. He kindly told me \"\"That's not what we do here\"\" and whisked us away. I planned both questions in advance. The Roth conversion was a strategy that one could agree made sense or dismiss as convoluted for some clients. But. The RMD issue was very different. They didn't have enough Schedule A deductions to itemize. Therefore the $3000 they donated each year wasn't impacting their return. By donating directly from their IRAs, this money would avoid tax. It would have saved them more than the cost of the tax guy, who charged a hefty fee, in my opinion. It seemed to me, this particular strategy should be obvious to one whose business is preparing returns.\"" }, { "docid": "159076", "title": "", "text": "\"Couple of clarifications to start off: Index funds and ETF's are essentially the same investments. ETF's allow you to trade during the day but also make you reinvest your dividends manually instead of doing it for you. Compare VTI and VTSAX, for example. Basically the same returns with very slight differences in how they are run. Because they are so similar it doesn't matter which you choose. Either index funds and ETF's can be purchased through a regular taxable brokerage account or through an IRA or Roth IRA. The decision of what fund to use and whether to use a brokerage or IRA are separate. Whole market index funds will get you exposure to US equity but consider also diversifying into international equity, bonds, real estate (REITS), and emerging markets. Any broker can give you advice on that score or you can get free advice from, for example, Future Advisor. Now the advice: For most people in your situation, you current tax rate is currently very low. This makes a Roth IRA a very reasonable idea. You can contribute $5,500 for 2015 if you do it before April 15 and you can contribute $5,500 for 2016. Repeat each year. You won't be able to get all your money into a Roth, but anything you can do now will save you money on taxes in the long run. You put after-tax money in a Roth IRA and then you don't pay taxes on it or the gains when you take it out. You can use Roth IRA funds for college, for a first home, or for retirement. A traditional IRA is not recommended in your case. That would save you money on taxes this year, when presumably your taxes are already low. Since you won't be able to put all your money in the IRA, you can put the rest in a regular taxable brokerage account (if you don't just want to put it in a savings account). You can buy the same types of things as you have in your IRA. Note that if your stocks (in your regular brokerage account) go up over the course of a year and your income is low enough to be in the 10 or 15% tax bracket and you have held the stock for at least a year, you should sell before the end of the year to lock in your gains and pay taxes on them at the capital gains rate of 0%. This will prevent you from paying a higher rate on those gains later. Conversely, if you lose money in a year, don't sell. You can sell and lock in losses during years when your taxes are high (presumably, after college) to reduce your tax burden in those years (this is called \"\"tax loss harvesting\"\"). Sounds like crazy contortions but the name of the game is (legally) avoiding taxes. This is at least as important to your overall wealth as the decision of which funds to buy. Ok now the financial advisor. It's up to you. You can make your own financial decisions and save the money but it requires you putting in the effort to be educated. For many of us, this education is fun. Also consider that if you use a regular broker, like Fidelity, you can call up and they have people who (for free) will give you advice very similar to what you will get from the advisor you referred to. High priced financial advisors make more sense when you have a lot of money and complicated finances. Based on your question, you don't strike me as having those. To me, 1% sounds like a lot to pay for a simple situation like yours.\"" }, { "docid": "102501", "title": "", "text": "Theoretically there is limited demand for risky investments, so higher-risk asset classes should outperform lower-risk asset classes over sufficiently long time periods. In practice, I believe this is true, but it could be several decades before a risky portfolio starts to outperform a more conservative one. Stocks are considered more risky than most assets. Small-cap stocks and emerging market stocks are particularly high-risk. I would consider low-fee ETFs in these areas, like VB or VWO. If you want to seek out the absolute riskiest investments, you could pick individual stocks of companies in dire financial situations, as Bank of America was a couple years ago. Most importantly, if you don't expect to need the money soon, I would maximize your contribution to tax-advantaged accounts since they will grow exponentially faster than taxable accounts. Over 50 years, a 401(k) or IRA will generally grow at least 50% more than a taxable account, maybe more depending on the tax-efficiency of your investments. Try to contribute the maximum ($17,500 for most people in 2014) if you can. If you can save more than that, I'd suggest contributing a Roth 401k rather than a traditional 401(k) - since Roth contributions are post-tax, the effective contribution limit is higher. Also contribute to a Roth IRA (up to $5,500 in 2014), using a backdoor Roth if necessary." }, { "docid": "68609", "title": "", "text": "\"I was told if I moved my 401k into a Roth IRA that school purposes is one reasons you can withdraw money without having to pay a tax. Incorrect. You will need to pay tax on the amount converted, since a 401(k) is pre-tax and a Roth IRA is after-tax. It will be added to your regular income, so you will pay tax at your marginal tax rate. is there any hidden tax or fee at all for withdrawing money from a Roth IRA for educational purposes? You still will need to pay the tax on the amount converted, but you'll avoid the 10% penalty for early withdrawal. I know that tuition, books and fees are covered for educational purposes. Can I take out of my Roth IRA for living expenses while I'm attending school? Rent, gas, food, etc... Room and board, yes, so long as you are half-time, but not gas/food Possibly only room and board for staying on-campus, but I'm not certain, although I doubt you could call your normal house payment \"\"education expense\"\" with my 401k being smaller, would it just be better to go ahead and cash the whole thing and just pay the tax and use it for whatever I need it for? What is the tax if I just decide to cash the whole thing in? You pay your marginal tax rate PLUS a 10% penalty for early withdrawal. So no, this is probably not a wise move financially unless you're on the verge of bankruptcy or foreclosure (where distress costs are much higher then the 10% penalty) I can't answer the other questions regarding grants; I would talk to the financial aid department at your school. Bottom line, transferring your 401(k) is very likely a bad idea unless you can afford to pay the tax in cash (meaning without borrowing). My advice would be to leave your 401(k) alone (it's meant for retirement not for school or living expenses) Ideally, you should pay for as much as you can out of cash flow, and don't take out more student loans. That may mean taking fewer classes, getting another part time job, finding a different (cheaper) school, applying for more grants and scholarships, etc. I would not in ANY circumstance cash out your 401(k) to pay for school. You'll be much worse off in the long run, and there are much cheaper ways to get money.\"" }, { "docid": "424841", "title": "", "text": "If your budget allows for it, max out both plans! However, in my opinion, you're on the right path: The advantage of also contributing to the Roth 401(k) in this case would be: This second point is the main reason that you should also invest in a 401(k), using that as a retirement savings vehicle alongside your Roth IRA. One caveat is that you should ensure that you'll have sufficient savings so that you won't need to dip into either plan - it'd be a shame to reduce the investment base from which you can grow your savings tax free. Personally, I'd view my contributions in the Roth IRA as an emergency fund to be used only in the direst circumstances." }, { "docid": "222836", "title": "", "text": "It sounds like you're comparing (1) the backdoor Roth IRA and (2) the mega backdoor Roth. Although the names are similar they are considerably different, and not mutually exclusive. The goal of the backdoor Roth IRA is to contribute to a Roth IRA even if you are over the income limits. This is accomplished by contributing to a non-deductible Traditional IRA and then converting to Roth. Both of these steps have no income limit (unlike a direct Roth IRA contribution, which does), and only the earnings (which should be minimal) will be taxed. More info here (mirror). The goal of the mega backdoor Roth is to get a lot of money into Roth accounts through salary deferral. This is accomplished by making non-Roth after-tax contributions to your 401(k) after exhausting the $18,000 limit (in 2017) for pre-tax + Roth employee contributions. The after-tax contributions (potentially up to $36,000 for 2017) can be rolled over to the Roth 401(k) or to a Roth IRA, while the earnings can be rolled over to the pre-tax 401(k) or a Traditional IRA, or taxed like regular income and converted to Roth along with the contributions. More info here (mirror)." }, { "docid": "424427", "title": "", "text": "Edited in response to JoeTaxpayer's comment and OP Tim's additional question. To add to and clarify a little what littleadv has said, and to answer OP Tim's next question: As far as the IRS is concerned, you have at most one Individual Retirement Account of each type (Traditional, Roth) though the money in each IRA can be invested with as many different custodians (brokerages, banks, etc.) and different investments as you like. Thus, the maximum $5000 ($6000 for older folks) that you can contribute each year can be split up and invested any which way you like, and when in later years you take a Required Minimum Distribution (RMD) from a Traditional IRA, you can get the money by selling just one of the investments, or from several investments; all that the IRS cares is that the total amount that is distributed to you is at least as large as the RMD. An important corollary is that the balance in your IRA is the sum total of the value of all the investments that various custodians are holding for you in IRA accounts. There is no loss in an IRA until every penny has been withdrawn from every investment in your IRA and distributed to you, thus making your IRA balance zero. As long as you have a positive balance, there is no loss: everything has to come out. After the last distribution from your Roth IRA (the one that empties your entire Roth IRA, no matter where it is invested and reduces your Roth IRA balance (see definition above) to zero), total up all the amounts that you have received as distributions from your Roth IRA. If this is less than the total amount of money you contributed to your Roth IRA (this includes rollovers from a Traditional IRA or Roth 401k etc., but not the earnings within the Roth IRA that you re-invested inside the Roth IRA), you have a loss that can be deducted on Schedule A as a Miscellaneous Deduction subject to the 2% AGI limit. This 2% is not a cap (in the sense that no more than 2% of your AGI can be deducted in this category) but rather a threshold: you can only deduct whatever part of your total Miscellaneous Deductions exceeds 2% of your AGI. Not many people have Miscellaneous Deductions whose total exceeds 2% of their AGI, and so they end up not being able to deduct anything in this category. If you ever made nondeductible contributions to your Traditional IRA because you were ineligible to make a deductible contribution (income too high, pension plan coverage at work etc), then the sum of all these contributions is your basis in your Traditional IRA. Note that your deductible contributions, if any, are not part of the basis. The above rules apply to your basis in your Traditional IRA as well. After the last distribution from your Traditional IRA (the one that empties all your Traditional IRA accounts and reduces your Traditional IRA balance to zero), total up all the distributions that you received (don't forget to include the nontaxable part of each distribution that represents a return of the basis). If the sum total is less than your basis, you have a loss that can be deducted on Schedule A as a Miscellaneous Deduction subject to the 2% AGI threshold. You can only deposit cash into an IRA and take a distribution in cash from an IRA. Now, as JoeTaxpayer points out, if your IRA owns stock, you can take a distribution by having the shares transferred from your IRA account in your brokerage to your personal account in the brokerage. However, the amount of the distribution, as reported by the brokerage to the IRS, is the value of the shares transferred as of the time of the transfer, (more generally the fair market value of the property that is transferred out of the IRA) and this is the amount you report on your income tax return. Any capital gain or loss on those shares remains inside the IRA because your basis (in your personal account) in the shares that came out of the IRA is the amount of the distribution. If you sell these shares at a later date, you will have a (taxable) gain or loss depending on whether you sold the shares for more or less than your basis. In effect, the share transfer transaction is as if you sold the shares in the IRA, took the proceeds as a cash distribution and immediately bought the same shares in your personal account, but you saved the transaction fees for the sale and the purchase and avoided paying the difference between the buying and selling price of the shares as well as any changes in these in the microseconds that would have elapsed between the execution of the sell-shares-in-Tim's-IRA-account, distribute-cash-to-Tim, and buy-shares-in-Tim's-personal account transactions. Of course, your broker will likely charge a fee for transferring ownership of the shares from your IRA to you. But the important point is that any capital gain or loss within the IRA cannot be used to offset a gain or loss in your taxable accounts. What happens inside the IRA stays inside the IRA." }, { "docid": "461933", "title": "", "text": "\"So you are paying taxes on your contributions regardless, the timing is just different. I am failing to see why would a person get an IRA, instead of just putting the same amount of money into a mutual fund (like Vanguard) or something like that. What am I missing? You are failing to consider the time value of money. Getting $1 now is more valuable to you than a promise to get $1 in a year, even though the nominal amount is the same. With a certain amount of principal now, you can invest it and it will (likely) grow into a bigger amount of money (principal + earnings) at a later time, and we can consider the two to have approximately equivalent value (the principal now has the same value as the principal + earnings later). With pre-tax money in Traditional IRA, the principal + earnings are taxed once at the time of withdrawal. Assuming the same flat rate of tax at contribution and withdrawal, this is equivalent to Roth IRA, where the principal is taxed at the time of contribution, because the principal now has the same value as the principal + earnings later, so the same rate of tax on the two have the same value of tax, even though when you look at nominal amounts, it might seem you are paying a lot less tax with Roth IRA (since the earnings are never \"\"taxed\"\"). With actual numbers, if we take a $1000 pre-tax contribution to Traditional IRA, it grows at 5% for 10 years, and a 25% flat rate tax, we are left with $1000 * 1.05^10 * 0.75 = $1221.67. With the same $1000 pre-tax contribution (so after 25% tax it's a $750 after-tax contribution) to a Roth IRA, growing at the same 5% for 10 years, and no tax at withdrawal, we are left with $1000 * 0.75 * 1.05^10 = $1221.67. You can see they are equivalent even though the nominal amount of tax is different (the lower amount of tax paid now is equivalent to the bigger amount of tax later). With a taxable investment which you will not buy and sell until you take it out, you contribute with after-tax money, and when you take it out, the \"\"earnings\"\" portion is subject to capital-gains tax. But remember that the principal + earnings later is equivalent to the principal now, which is already all taxed once, and if we tax the \"\"earnings\"\" portion later, that is effectively taxing a portion of the money again. Another way to look at it is the contribution is just like the Roth IRA, but the withdrawal is worse because you have to pay capital-gains tax instead of no tax. You can take the same numbers as for the Roth IRA, $1000 * 0.75 * 1.05^10 = $1221.67, but where the $1221.67 - $750 = $471.67 is \"\"earnings\"\" and is taxed again at, say, a 15% capital-gains rate, so you lose another $70.75 in tax and are left with $1150.92. You would need a capital-gains tax rate of 0% to match the advantage of the pre-tax Traditional IRA or Roth IRA. After-tax money in Traditional IRA has a similar problem -- the contribution is after tax, but after it grows into principal + earnings, the \"\"earnings\"\" part is taxed again, except it is worse than the capital-gains case because it is taxed as regular income. Like above, you can take the same numbers as for the Roth IRA, $1000 * 0.75 * 1.05^10 = $1221.67, but where the $471.67 \"\"earnings\"\" is taxed again at 25%, so you lose another $117.92 in tax and are left with $1103.75. So although the nominal amount of tax paid is the same as for pre-tax money in Traditional IRA, it ends up being a lot worse. (Everything I said above about pre-tax money in Traditional IRA, after-tax money in Traditional IRA, and Roth IRA, also applies to pre-tax money in Traditional 401(k), after-tax money in Traditional 401(k), and Roth 401(k), respectively.) Regarding the question you raise in the title of your question, why someone would get contribute to a Traditional IRA if they already have a 401(k), the answer is, mostly, they wouldn't. First, note that if you merely have a 401(k) account but neither you nor your employer contributes to it during the year, then that doesn't prevent you from deducting Traditional IRA contributions for that year, so basically you can contribute to one or the other; so if you only want to contribute below the IRA contribution limit, and don't need the bigger 401(k) contribution limit, and the IRA's investment options are more attractive to you than your 401(k)'s, then it might make sense for you to contribute to only Traditional IRA. If you or your employer is already contributing to your 401(k) during the year, then you cannot deduct your Traditional IRA contributions unless your income is very low, and if your income is really that low, you are in such a low tax bracket that Roth IRA may be more advantageous for you. If you make a Traditional IRA contribution but cannot deduct it, it is a non-deductible Traditional IRA contribution, i.e. it becomes after-tax money in a Traditional IRA, which as I showed in the section above has much worse tax situation in the long run because its earnings are pre-tax and thus taxed again. However, there is one good use for non-deductible Traditional IRA contributions, and that is as one step in a \"\"backdoor Roth IRA contribution\"\". Basically, there is an income limit for being able to make Roth IRA contributions, but there is no income limit for being able to make Traditional IRA contributions or for being able to convert money from Traditional IRA to Roth IRA. So what you can do is make a (non-deductible) Traditional IRA contribution, and then immediately convert it to Roth IRA, and if you did not previously have any pre-tax money in Traditional IRAs, this achieves the same as a regular Roth IRA contribution, with the same tax treatment, but you can do it at any income level.\"" }, { "docid": "38532", "title": "", "text": "\"Your contribution limit to a 401(k) is $18,000. Your employer is allowed to contribute to your 401(k), usually a \"\"matching contribution\"\". That matching contribution comes from your employer, so is not subject to your personal contribution limit. A contribution to a regular 401(k) is typically made with pre-tax money (i.e. you don't pay payroll taxes on the money you contribute) so you pay less taxes for the current tax year. However when you retire and you take money out, you pay taxes on the money you take out. On one hand, your tax rate may be lower when you have retired, but on the other hand, if your investments have appreciated over time, the total amount of tax you pay would be higher. If your company offers a Roth 401(k) plan, you can contribute $18,000 of after tax money. This way you pay the tax on the $18,000 today, as you would if you did not put the money in the 401(k), but when you take the money out at retirement, you would not have to pay tax. In my opinion, that serves as a way to pay effectively more money into your 401(k). Some firms put vesting provisions on the amount that they match in your 401(k), e.g. 4 years at 25% per year. So you have to work 1 full year to be entitled to 25% of their matching contribution, 2 years for 50%, and 4 years to receive all of it. Check your company's Summary Plan Description of the 401(k) to be sure. You are not allowed to invest pre-tax money into a Traditional IRA if you are already contributing to a 401(k) plan and have reached the income limits ($62,000 AGI for single head of household). You are allowed to contribute post-tax money to a Traditional IRA plan if you have already contributed to a 401(k), which you can then Roll-over into a Roth IRA (look up 'backdoor IRA'). The IRA contribution limit applies to all IRA accounts over that calendar year. You could put some money in a traditional IRA, a Roth IRA, another traditional IRA, etc. so long as the total amount is not more than the contribution limit. This gives you an upper limit of 5.5k + 18k = 23.5 investments in retirement accounts. Note however, once you reach age 50, these limits increase to 6.5k (IRA) + 24k (401(k)). They also are adjusted periodically with the rate of inflation. The following approach may be more efficient for building wealth: This ordering is the subject of debate and people have different opinions. There is a separate discussion of these priorities here: Best way to start investing, for a young person just starting their career? Note however, a 401(k) loan becomes payable if you leave your company, and if not repaid, is an unauthorised distribution from your 401k (and therefore subject to an additional 10% tax penalty). You should also be careful putting money into an IRA, as you will be subject to an additional 10% tax penalty if you take out the money (distribution) before retirement, unless one of the exceptions defined by the IRA applies (e.g. $10,000 for first time home purchase), which could wipe out more than any gains you made by putting it in there in the first place. Your specific circumstances may vary, so this approach may not be best for you. A registered financial advisor may be able to help - ensure they are legitimate: https://adviserinfo.sec.gov\"" }, { "docid": "499606", "title": "", "text": "To answer your question: As far as what's available in addition to your 401(k) at work (most financial types will say to contribute up to the match first), you may qualify for a Roth IRA (qualification is based on income), if not, then you may have to go with a Traditional IRA. You and your husband can each have one and contribute up to the limit each year. After that, you could get just a straight up mutual fund, and/or contribute up to limit on your 401(k). My two cents: This may sound counter-intuitive (and I'm sure some folks will disagree), but instead of contributing to your 401(k) now, take whatever that amount is, and use it to pay extra on the car loan. Also take the extra being paid on the mortgage and pay it on the car loan too. Once the car loan is paid off, then set aside 15% of your gross income and use that amount to start your retirement investing. Any additional money beyond this can then go into the mortgage. Once it's paid off, then you can take the extra you were paying, plus the mortgage and invest that amount into mutual funds. You may want to check out Chris Hogan's Retire Inspired book or podcast as well." }, { "docid": "196961", "title": "", "text": "Very grey area. You can't pay them to run errands, mow the lawn, etc. I'd suggest that you would have to have self employment income (i.e. your own business) for you to justify the deduction. And then the work itself needs to be applicable to the business. I've commented here and elsewhere that I jumped on this when my daughter at age 12 started to have income from babysitting. I told her that in exchange for her taking the time to keep a notebook, listing the family paying her, the date, and amount paid, I'd make a deposit to a Roth IRA for her. I've approaches taxes each year in a way that would be audit-compliant, i.e. a paper trail that covers any and all deductions, donations, etc. In the real world, the IRS isn't likely to audit someone for that Roth deposit, as there's little for them to recover." } ]

[ { "docid": "292748", "title": "", "text": "\"I really have to use the business card for personal expenses, please assume that in your answer. This is very hard to believe. You must do that? Why not just have the company pay you $1600 each month? Then you can use that money for whatever you want. Why can't you do this? (I cannot think of a legitimate reason...) How to integrate the personal expenses in company? Anyway, to answer your question, what I've done when I accidentally used my corporate card for a personal expense is to code the expense as a payment to me similar to if a check had been written to me. If you aren't ever paying yourself, then you should just pay the company back the $1600 every month. As a side note, I highly recommend you don't do this. By doing this on a regular basis you are opening the door for piercing the corporate veil. This means that the financial protections provided by the LLC could potentially be stripped away since personal and corporate funds are being mixed. The unfortunate end result is that personal assets could end up being fair game too in a judgement against the company. Even if you aren't an owner, your relative could be considered to be \"\"using business money for personal expenses\"\", namely, letting a relative spend business funds for personal use. How to show more expenses and lessen the profit? If you're referring to the personal expenses, then you absolutely do not want to do this! That's illegal and worthy of stiff penalties, which possibly include jail time for tax evasion. Better to just have the company pay you and then the entire payment is deductible and reduces the profit of the company.\"" } ]

[ { "docid": "58005", "title": "", "text": "Your practice of waiting until you can pay cash is a good one. It will certainly prevent you from getting into debt! Now, to be clear, your question puts a credit card in the same category as a loan, but it doesn't have to be. You could use a credit card almost like cash, if you are careful. I'm not familiar with the system in France, but in the US, even if you are paying cash all the time, there are some benefits to getting a credit card and paying it off in full every month, instead of simply paying with cash. Some of those benefits are: One pretty big downside of having a credit card depends on your personality. Some people, once they have credit, end up spending beyond their means, and end up getting into debt. Please look into whether credit cards work the same way in France before considering the above advice. As for your question regarding getting a loan vs paying cash, that will usually be personal preference, since with a loan you can buy expensive items (such as a house or car) much sooner than you otherwise could if you waited until you saved the money. For example, it might take 10 years or more to build up enough money to purchase a house with cash, so if you don't want to wait that long, you'll need to finance it." }, { "docid": "345697", "title": "", "text": "\"It all comes down to how the loan itself is structured and reported - the exact details of how they run the loan paperwork, and how/if they report the activity on the loan to one of the credit bureaus (and which one they report to). It can go generally one of three ways: A) The loan company reports the status to a credit reporting agency on behalf of both the initiating borrower and the cosigner. In this scenario, both individuals get a new account on their credit report. Initially this will generally drop related credit scores somewhat (it's a \"\"hard pull\"\", new account with zero history, and increased debt), but over time this can have a positive effect on both people's credit rating. This is the typical scenario one might logically expect to be the norm, and it effects both parties credit just as if they were a sole signor for the loan. And as always, if the loan is not paid properly it will negatively effect both people's credit, and the owner of the loan can choose to come after either or both parties in whatever order they want. B) The loan company just runs the loan with one person, and only reports to a credit agency on one of you (probably the co-signor), leaving the other as just a backup. If you aren't paying close attention they may even arrange it where the initial party wanting to take the loan isn't even on most of the paperwork. This let the person trying to run the loan get something accepted that might not have been otherwise, or save some time, or was just an error. In this case it will have no effect on Person A's credit. We've had a number of question like this, and this isn't really a rare occurrence. Never assume people selling you things are necessarily accurate or honest - always verify. C) The loan company just doesn't report the loan at all to a credit agency, or does so incorrectly. They are under no obligation to report to credit agencies, it's strictly up to them. If you don't pay then they can report it as something \"\"in collections\"\". This isn't the typical way of doing business for most places, but some businesses still operate this way, including some places that advertise how doing business with them (paying them grossly inflated interest rates) will \"\"help build your credit\"\". Most advertising fraud goes unpunished. Note: Under all of the above scenarios, the loan can only effect the credit rating attached to the bureau it is reported to. If the loan is reported to Equifax, it will not help you with a TransUnion or Experian rating at all. Some loans report to multiple credit bureaus, but many don't bother, and credit bureaus don't automatically copy each other. It's important to remember that there isn't so much a thing as a singular \"\"consumer credit rating\"\", as there are \"\"consumer credit ratings\"\" - 3 of them, for most purposes, and they can vary widely depending on your reported histories. Also, if it is only a short-term loan of 3-6 months then it is unlikely to have a powerful impact on anyone's credit rating. Credit scores are formulas calibrated to care about long-term behavior, where 3 years of perfect credit history is still considered a short period of time and you will be deemed to have a significant risk of default without more data. So don't expect to qualify for a prime-rate mortgage because of a car loan that was paid off in a few months; it might be enough to give you a score if you don't have one, but don't expect much more. As always, please remember that taking out a loan just to improve credit is almost always a terrible idea. Unless you have a very specific reason with a carefully researched and well-vetted plan that means that it's very important you build credit in this specific way, you should generally focus on establishing credit in ways that don't actually cost you any money at all. Look for no fee credit cards that you pay in full each month, even if you have to start with credit-building secured card plans, and switch to cash-value no-fee rewards cards for a 1-3% if you operate your financial life in a way that this doesn't end up manipulating your purchasing decisions to cost you money. Words to the wise: \"\"Don't let the credit score tail wag the personal financial dog!\"\"\"" }, { "docid": "481822", "title": "", "text": "I used to do this all the time but it's more difficult now. Just a general warning that this probably isn't a good idea unless you're very responsible with your money because it's easy to get yourself in a bad position if you're not careful. You can get a new credit card that does balance transfers and request balance transfer checks from them. Then just use one of those balance transfer checks to mail a payment to the loan you want to transfer. Make sure your don't use the entire credit line as the credit card will have the balance transfer fee put on it as well. You used to be able to find credit cards with 0% balance transfer fee but I haven't seen one of those in ages. Chase Slate is the lowest I've seen recently at 2%. Alternately, if you have a lot of expenses every month then it's easy to find a credit card where all purchases are 0% interest for a year or more and use that to pay every possible expense for a few months and use the money you'd normally use to pay for those expenses to pay off the original loan. If you're regular monthly expenses are high enough you can pay off the original loan quickly and then pay on the credit card with no interest as normal. The banks are looking to hook you so make sure you pay them off before the zero percent runs out or make sure you know what happens after it does. Normally the rate sky rockets. Also, don't use that card for anything else. Credit card companies always put payments towards the lowest interest rate first so if you charge something that doesn't qualify for 0% then it will collect interest until you've paid off the entire 0% balance which will likely take a while and cost you a lot of money. If you have to pay a balance transfer fee then figure out if it's less then you would have paid if you continued paying interest on the original loan. Good luck. I hope it works out for you." }, { "docid": "81467", "title": "", "text": "\"It's really not an \"\"either-or\"\"... it's BOTH. They each have their place & use. * 2-sided business cards are best thought of as **\"\"miniature advertising brochures\"\"** (shirt pocket/wallet-sized) -- great for certain types of businesses -- and for being generic (and cheap) handouts at show booths, conventions, etc. (Plus you can issue a stack of them to ANY employee -- 2-sided cards should be \"\"company\"\" cards, *sans* any individuals names or contact info -- just the general company phone number, website, etc). *Other than being mere \"\"advertising\"\" one useful option is to make the back of the card have something VALUABLE on it (something that makes the person KEEP it) -- calendars, industry reference info (chart/table/common calculations, etc).* * 1-sided business cards are **personalized \"\"calling cards\"\"** (logo, person's name, title & SPECIFIC contact info, phone + ext, email, etc -- in addition to base company info) -- you use them when meeting people SPECIFICALLY & PERSONALLY -- and you want the back to be blank for you (or them) to scratch notes, etc. (in fact even leaving some white space on the front is a good idea). EDIT: ***[This guy's got it nailed!](http://www.reddit.com/r/business/comments/2cjxja/one_sided_business_cards_or_two_sided/cjg8jox)***\"" }, { "docid": "591704", "title": "", "text": "\"simplicity and roi are often at odds. the simplest plan that also supports a reasonable investment return would have 3 accounts: if you want to get better returns on your investments, things can get much more complicated. here are some optional accounts to consider: besides the mechanics of money flowing between accounts, a budget helps you understand and control your spending. while there are many methods for this (e.g. envelopes of cash, separate accounts for various types of expenses), the simplest might be using mint.com. just be sure to put all your spending on a credit or debit card, and you can see your spending by category when you log into mint. it can take a bit to get it set up, and your bank needs to be compatible, but it can give you a really good picture of where your money is going. once you know that, you can start making decisions like \"\"i should spend less on coffee\"\", or \"\"i should go to the zoo more\"\", based on how much things cost vs how much you enjoy them. if you feel like your spending is out of control, then you can set yourself hard limits on certain kinds of spending, but usually just watching and influencing your own choices is enough. notes: if you have a spouse or partner, you should each maintain your own separate accounts. there are many reasons for this including simplicity and roi, besides the obvious. if you feel you must have a joint account, be sure to clearly define how it should be used (e.g. only for paying the utilities) and funded (x$ per month each). particularly with your house, do not do joint ownership. one of you should be a renter and the other a landlord. some of these statements assume you are in the usa. on a personal note, i have about 20 credit cards, 2 checking accounts, 2 ira's, 2 brokerage accounts, and 3 401k's. but i consider myself a personal finance hobbyist, and spend an absurd amount of time chasing financial deals and tax breaks.\"" }, { "docid": "261016", "title": "", "text": "\"This is second hand information as I am not a millionaire, but I work with such people everyday and have an understanding of how they handle cash: The wealthy people don't. Simple. Definitely not if they don't have to. Cash is a tool to them that they use only if they get benefit of it being a cash transaction (one of my friends is a re-seller and he gets a 10% discount from suppliers for settling lines using cash). Everything else they place on a line of credit. For people who \"\"dislike\"\" credit cards and pay using ATM or debit cards might actually have a very poor understanding of leverage. I assure you, the wealthy people have a very good understanding of it! Frankly, wealthy people pay less for everything, but they deserve it because of the extreme amount of leverage they have built for themselves. Their APRs are low, their credit limits are insanely high, they have longer billing periods and they get spoiled by credit card vendors all the time. For example, when you buy your groceries at Walmart, you pay at least a 4% markup because that's the standardized cost of processing credit cards. Even if you paid in cash! A wealthy person uses his credit card to pay for the same but earns the same percentage amount in cash back, points and what not. I am sure littleadv placed the car purchase on his credit card for similar reasons! The even more wealthy have their groceries shipped to their houses and if they pay cash I won't be surprised if they actually end up paying much less for fresh (organic) vegetables than what equivalent produce at Walmart would get them! I apologize for not being able to provide citations for these points I make as they are personal observations.\"" }, { "docid": "202457", "title": "", "text": "It is likely the policy of the credit card company. If you are running a business, you should factor in theft as part of your mark-up/margin. Every major business accounts for theft within their business practices and accounting. That way they are covered for instances like yours. If you have not been accounting for theft, then I'd highly recommend it. This might be an expensive learning lesson for your family business. Either implement new procedures such as checking ID with credit cards to match the names, or factor in theft/loss of product into your margins. Ideally, do both." }, { "docid": "229937", "title": "", "text": "\"Zip code, as well as billing address, is used in conjunction with the Address Verification Service (AVS). AVS is a web (or phone) service that actually verifies the address with the billing address on file with the issuing bank. It does not use the credit card stripe. You can see more information from various sources such as bank merchant help pages like Bank of America's. As far as what is stored on the stripe, it varies some by bank (as there are some \"\"optional\"\" areas). The standards are discussed here. Fields include your account number, name, the expiration date, some card-specific stuff, and then the discretionary section. I would not expect much in terms of address type information there. So - the answer to your question is that they can't really take much more than your name and CC #, unless you give it to them. If you give a false zip code, you may have your purchase rejected. They certainly do keep track of the credit card number, and I would suppose that is the most valuable piece to them; they can see you make purchases across time and know for a fact that it's the same exact person (since it's the same card). Additionally, zip codes for AVS from pay-at-the-pump are supposedly not generally used for marketing (see this article for example). That is probably not true at at-the-register (in-person) collections, most of those aren't for AVS anyway. Even California permits the pay-at-the-pump zip verification as long as it's only used for that (same article). I would assume any information given, though, is collected for marketing purposes.\"" }, { "docid": "40628", "title": "", "text": "\"There's no law in California that says you have to have a cash register. Logging cash sales manually, as you are doing, is fine. A cash register would help you track your cash sales as you describe. Some POS software will also allow you to log cash transactions, but it sounds like you just use a credit card processing web site or application, not a full-fledged POS system. In any case, for a small business, one option might be to get a cash register to log your cash sales, and continue to process credit cards the way you are (or continue as you are doing). Come tax season, use the output from both systems to calculate your income. You might want to consider an accounting software like Quickbooks so you can reconcile your income and expenses and statements from different sources. Also, as with any small business, it's worth your while to consult a tax accountant to make sure you're doing everything \"\"by the books\"\". Once you're set up properly, keeping the books in order becomes routine and easy.\"" }, { "docid": "2018", "title": "", "text": "\"As i see it, with a debit card, they are taken kinda out of the game. They are not lending money, it seems really bad for them. Not exactly. It is true that they're not lending money, but they charge a hefty commission from the retailers for each swipe which is pure profit with almost no risk. One of the proposals considered (or maybe approved already, don't know) in Congress is to cap that hefty commission, which will really make the debit cards merely a service for the checking account holder, rather than a profit maker for the bank. On the other hand, it's definitely good for individuals. I disagree with that. Debit cards are easier to use than checks, but they provide much less protection than credit cards. Here's what I had to say on this a while ago, and seems like the community agrees. But, why do we really need a credit history to buy some of the more expensive stuff Because the system is broken. It rewards people in debt by giving them more opportunities to get into even more debts, while people who owe nothing to noone cannot get a credit when they do need one. With the current system the potential creditor can only asses the risk of someone who has debt already, they have no way of assessing risks of someone with no debts. To me, all this credit card system seems like an awfully nice way to make loads of money, backed by governments as well. Well, credit cards have nothing to do with it. It's the credit scores system that is broken. If we replace the \"\"card\"\" with \"\"score\"\" in your question - then yes, you're thinking correctly. That of course is true for the US, in other countries I have no knowledge on how the creditors assess the risks.\"" }, { "docid": "85466", "title": "", "text": "\"Personally, I use my credit cards for everything because I get reward points (or, cash back, depending on the card), and I build credit history. I've had credit cards since I was 18 (now 22), and my credit score is in the higher end 700s which I'm told is pretty good for my age. Additionally, since I put my rent and large purchases on my credit card, I have a lot of reward points. I use these to buy things I wouldn't normally buy to try them out and see if they bring any value into my life. If not, I didn't really lose anything, but I have found value in some of those things. I realize most of this is gamification and consumerism at play, but getting that extra little thing once in a while for \"\"free\"\" which is pretty nice.\"" }, { "docid": "128465", "title": "", "text": "Credit is very important even if you are wealthy. One thing you may not realize is that rich people typically have comparatively little cash on hand. If they're smart, most of their assets are not liquid - they're tied up in safe, long-term investments. They use credit for their day-to-day expenses and pay it off from the dividends on their investments (which might only come in once a quarter). There are also tax advantages to using credit. If a rich person wanted a new car, he'd be smarter leasing it for his business (immediate write-off of the lease payments on taxes) versus buying it (depreciation over several years plus property tax liability in some states). There are more elaborate tax dodges but the point is that buying a car outright is the worst option in terms of tax avoidance. Another way the rich (mis) use credit is so that they don't risk their own money on business ventures. Let's say I have $1,000,000 in my personal bank account, and I want to buy a business that costs $1M. If I am dumb, I clean out my bank account and put all my money in the business. I get 100% of the profits, but I also bear 100% of the risk. If I'm smart, I loan 200K of my own money in the business and put the rest someplace safe, and get a loan from a bank for the other 800K. If the business succeeds, the bank gets their money back plus interest. If it fails, the business declares bankruptcy and the bank eats the 800k loss. If I structured the debt right, my personal loan to the failed business gets paid back first when the company is liquidated, and the bank gets whatever is left over (if anything). The most of my own money I can possibly lose is 200k, and probably it's closer to zero if I have a good accountant." }, { "docid": "478807", "title": "", "text": "\"What you are describing sounds a lot like the way we handle our household budget. This is possible, but quite difficult to do with an Excel spreadsheet. It is much easier to do with dedicated budgeting software designed for this purpose. When choosing personal budgeting software, I've found that the available packages fall in two broad categories: Some packages take what I would call a proactive approach: You enter in your bank account balances, and assign your money into spending categories. When you deposit your paycheck, you do the same thing: you add this money to your spending categories. Then when you spend money, you assign it to a spending category, and the software keeps track of your category balances. At any time, you can see both your bank balances and your spending category balances. If you need to spend money in a category that doesn't have any more money, you'll need to move money from a different category into that one. This approach is sometimes called the envelope system, because it resembles a digital version of putting your cash into different envelopes with different purposes. A few examples of software in this category are You Need a Budget (YNAB), Mvelopes, and EveryDollar. Other packages take more of a reactive approach: You don't bother assigning a job to the money already in your bank account. Instead, you just enter your monthly income and put together a spending plan. As you spend money, you assign the transactions to a spending category, and at the end of the month, you can see what you actually spent vs. what your plan was, and try to adjust your next budget accordingly. Software that takes this approach includes Quicken and Mint.com. I use and recommend the proactive approach, and it sounds from your question like this is the approach that you are looking for. I've used several different budgeting software packages, and my personal recommendation is for YNAB, the software that we currently use. I don't want this post to sound too much like a commercial, but I believe it will do everything you are looking for. One of the great things about the proactive approach, in my opinion, is how credit card accounts are handled. Since your spending category balances only include real money actually sitting in an account (not projected income for the month), when you spend money out of a category with your credit card, the software deducts the money from the spending category immediately, as it is already spent. The credit card balance goes negative. When the credit card bill comes and you pay it, this is handled in the software as an account transfer from your checking account to your credit card account. The money in the checking account is already set aside for the purpose of paying your credit card bill. Dedicated budgeting software generally has a reconcile feature that makes verifying your bank statements very easy. You just enter the date of your bank statement and the balance, and then the software shows you a list of the transactions that fall in those dates. You can check each one against the transactions on the statement, editing the ones that aren't right and adding any that are missing from the software. After everything checks out, the software marks the transactions as verified, so you can easily see what has cleared and what hasn't. Let me give you an example to clarify, in response to your comment. This example is specific to YNAB, but other software using the same approach would work in a similar way. Let's say that you have a checking account and a credit card account. Your checking account, named CHECKING, has $2,000 in it currently. Your credit card currently has nothing charged on it, because you've just paid your bill and haven't used it yet this billing period. YNAB reports the balance of your credit card account (we'll call this account CREDITCARD), as $0. Every dollar in CHECKING is assigned to a category. For example, you've got $200 in \"\"groceries\"\", $100 in \"\"fast food\"\", $300 in \"\"rent\"\", $50 in \"\"phone\"\", $500 in \"\"emergency fund\"\", etc. If you add up the balance of all of your categories, you'll get $2,000. Let's say that you've written a check to the grocery store for $100. When you enter this in YNAB, you tell it the name of the store, the account that you paid with (CHECKING), and the category that the expense belongs to (groceries). The \"\"groceries\"\" category balance will go down from $200 to $100, and the CHECKING account balance will go down from $2,000 to $1,900. Now, let's say that you've spent $10 on fast food with your credit card. When you enter this in YNAB, you tell it the name of the restaurant, the account that you paid with (CREDITCARD), and the category that the expense belongs to (fast food). YNAB will lower the \"\"fast food\"\" category balance from $100 to $90, and your CREDITCARD account balance will go from $0 to $-10. At this point, if you add up all the category balances, you'll get $1,890. And if you add up your account balances, you'll also get $1,890, because CHECKING has $1,900 and CREDITCARD has $-10. If you get your checking account bank statement at this time, the account balance of $1,900 should match the statement and you'll see the payment to the grocery store, assuming the check has cleared. And if the credit card bill comes now, you'll see the fast food purchase and the balance of $-10. When you write a check to pay this credit card bill, you enter this in YNAB as an account transfer of $10 from CHECKING to CREDITCARD. This transfer does not affect any of your category balances; they remain the same. But now your CHECKING account balance is down to $1,890, and CREDITCARD is back to $0. This works just as well whether you have one checking account and one credit card, or 2 checking accounts, 2 savings accounts, and 3 credit cards. When you want to spend some money, you look at your category balance. If there is money in there, then the money is available to spend somewhere in one of your accounts. Then you pick an account you want to pay with, and, looking at the account balance, if there isn't enough money in that account to pay it, you just need to move some money from another account into that one, or pick a different account. When you pay for an expense with a credit card, the money gets deducted from the category balances immediately, and is no longer available to spend on something else.\"" }, { "docid": "369996", "title": "", "text": "\"You want to know if you should pay cash or use a credit card like cash? There are so many benefits to the card, like purchase protection, cash back, and postponed payments, that there needs to be a really good reason to pay cash. If you are concerned about the 10% threshold, ask your credit card company to raise your limit. If you are indifferent, let the merchant decide for you by asking for a discount if you pay cash. The biggest reason is that credit cards, when handled shrewdly, make your money work for you by keeping it in less liquid / higher interest investments like inflation-adjusted T-bills. You will still be able to access it by using the credit card to float large expenses without liquidating at a loss. Investment Accounts like Schwab One are great for this since you can \"\"borrow\"\" cash at a low interest rate against your securities, until your security sale clears.\"" }, { "docid": "463065", "title": "", "text": "\"This is the best tl;dr I could make, [original](https://www.linkedin.com/pulse/ten-years-after-subprime-mortgage-crisis-us-credit-card-walden-siew) reduced by 84%. (I'm a bot) ***** > Things have come a really long way since the dark days of the credit crisis, and it's really flipped completely the other way where now it doesn't really take great credit to get a credit card. > MS: This is definitely a case of history repeating itself, but the thing is we don't know what the tip of the mountain is when it comes to credit card debt, because when credit card debt started to fall in 2008 in the credit crisis, credit card debt wasn't the central problem that sent us over the edge. > MS: We really have seen all levels, from folks with less than perfect credit to folks with 800 credit scores spending more, and that has been part of what's driven up America's credit card balances to these record levels. ***** [**Extended Summary**](http://np.reddit.com/r/autotldr/comments/6txd7q/ten_years_after_the_subprime_mortgage_crisis_a_us/) | [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ \"\"Version 1.65, ~191596 tl;drs so far.\"\") | [Feedback](http://np.reddit.com/message/compose?to=%23autotldr \"\"PM's and comments are monitored, constructive feedback is welcome.\"\") | *Top* *keywords*: **credit**^#1 **card**^#2 **debt**^#3 **really**^#4 **crisis**^#5\"" }, { "docid": "598428", "title": "", "text": "\"Paypal forbids using their credit card service to \"\"give yourself a cash advance or help others to do so\"\". For small ammounts you may get away with it but pushing $10K through a PayPal account is going to raise red flags. In the USA it seems that some cards allow balance transfers from other types of loan while others are restricted to credit cards only. So that is a possibility. Another option can be to find a card with a good deal on purchases. Then move your regular purchases to the card and use the money you would normally have spent on purchases to pay off the other loan. Remember credit cards can be either a very cheap way to borrow or a very expensive way. Which one they are depends on how good you are at negotiating the traps they set up for you. If you do use a credit card deal make sure you Is it overall a viable option? That depends on the details which are not specified in your hypothetical scenario incluing the persons credit rating , what the interest is like on the existing loan and what the expected time to repay the debt is.\"" }, { "docid": "444590", "title": "", "text": "I was hoping to comment on the original question, but it looks to me like the asker lives in the EU, where credit cards are a lot less common and a lot of the arguments (car rental, building up of credit etc) brought forward by people living in the US just don't apply. In fact especially airlines (and other merchants) will charge you extra when using a credit card instead of a debit card and this can add up fairly quickly. I hold a credit card purely for travelling outside the EU and occasionally I will travel for work and make my own arrangements, then it can come in handy as I am able to reclaim my expenses before I have to pay my credit card bill (in this case I will also claim the extra credit card fees from my employer). This however is for my personal convenience and not strictly necessary. (I could fill out a bunch of paperwork and claim the costs from my employer as an advance.) In the EU I find that if my VISA debit card will not work in a shop, neither will my credit card, so on that note it's pretty pointless. So to answer the asker question: If you live (and travel) in the EU you don't need a credit card, ever. If you travel to the US, it would be advantageous to get one. Occasionally banks will offer you a credit card for free and there's no harm in taking it (apart from the fact that you have one more card to keep track off), but if you do, set up a direct debit to pay it off automatically. And as other people have said: Don't spend money you don't have. If you are not absolutely sure you can't do this, don't get a credit card." }, { "docid": "283079", "title": "", "text": "\"I'm not sure what you mean by \"\"writing off your time,\"\" but to answer your questions: Remember that, essentially, you are a salaried employee of a corporation. So if you are spending time at your job, even if you are not billing anything to a client, you are earning your salary. If there are costs involved with these activities (maybe class fees, a book purchase, or travel expenses), the corporation should be paying the costs as business expenses. However, the logistics of this, whether the corporation writes a business check to the vendor directly, or you put the expenses on a personal credit card and are reimbursed with an expense check from the corporation, don't matter. Your accountant can show you the right way to do this.\"" }, { "docid": "83346", "title": "", "text": "\"For practical purposes, I would strongly suggest that you do create a separate account for each business you may have that is used only for business purposes, and use it for all of your business income and expenses. This will allow you to get an accurate picture of whether you are making money or not, what your full expenses really are, how much of your personal money you have put into the business, and is an easy way to keep business taxes separate. You will also be able to get a fairly quick read on what your profits are without doing much accounting by looking at the account balance less future taxes and expenses, and less any personal money you've put into the account. Check out this thread from Paypal about setting up a \"\"child\"\" account that is linked to your personal account and can be set up to autosweep payments into your main account, should you like. You will still be able to see transactions for each child account. NOTE: Do be careful to make sure you are reserving the proper amount out of any profits your startup may have for taxes - you don't want to mix this with personal money and then later find out that you owe taxes and have to scramble to come up with the money if you have already spent it This is one of the main reasons to segregate your startup's revenues and profits in the business account. For those using \"\"brick and mortar\"\" banking services rather than a service like Paypal: You likely do not need a business checking account if you are a startup. Most likely, you can simply open a second personal account with your bank in your name, and name it \"\"John Doe DBA Company Name\"\" (DBA = Doing Business As). This way, you can pay expenses and accept payments in the name of your startup. Check with your banker for additional details (localized information).\"" } ]

[ { "docid": "586355", "title": "", "text": "\"Yes, it applies to control groups. If I remember correctly common ownership rules are used to determine \"\"Applicable Large Employer\"\" status but if the time comes to owe a penalty, only the actual entity missing the mark will owe a penalty, not the entire control group. This is an excerpt from Section 4980H (the section that lays out employer requirements and penalties) (16) Employer. The term employer means the person that is the employer of an employee under the common-law standard. See § 31.3121(d)-1(c). For purposes of determining whether an employer is an applicable large employer, all persons treated as a single employer under section 414(b), (c), (m), or (o) are treated as a single employer. Thus, all employees of a controlled group of entities under section 414(b) or (c), an affiliated service group under section 414(m), or an entity in an arrangement described under section 414(o), are taken into account in determining whether the members of the controlled group or affiliated service group together are an applicable large employer. For purposes of determining applicable large employer status, the term employer also includes a predecessor employer (see paragraph (a)(36) of this section) and a successor employer. Link to the Federal Register\"" } ]

[ { "docid": "390744", "title": "", "text": "\"I don't think you've mentioned which State you're in. Here in Ontario, a person who is financially incapable can have their financial responsibility and authority removed, and assigned to a trustee. The trustee might be a responsible next of kin (as her ex, you would appear unsuitable: that being a potential conflict of interest); otherwise, it can be the Public Guardian and Trustee. It that happens, then the trustee handles the money; and handles/makes any contracts on behalf of (in the name of) the incapable person. The incapable person might have income (e.g. spousal support payments) and money (e.g. bank accounts), which the trustee can document in order to demonstrate credit-worthiness (or at least solvency). For the time being, the kids see it as an adventure, but I suspect, it will get old very fast. I hope you have a counsellor to talk with about your personal relationships (I've had or tried several and at least one has been extraordinarily helpful). You're not actually expressing a worry about the children being abused or neglected. :/ Is your motive (for asking) that you want her to have a place, so that the children will like it (being there) better? As long as your kids see it as an adventure, perhaps you can be happy for them. Perhaps (I don't know: depending on the people) too it's a good (or at least a better) thing that they are visiting with friends and relatives; and, a better conversational topic with those people might be how they show your children a good time (instead of your ex's money). One possible way I thought of co-signing is if a portion of child/spousal support goes directly to the landlord. I asked the Child Support Services (who deduct money from my paycheck monthly to pay support to my ex) and they told me that they are not authorized to do this. Perhaps (I don't know) there is some way to do that, if you have your ex's cooperation and a lawyer (and perhaps a judge). You haven't said what portions of your payments are for Child support, versus Spousal support (nor, who has custody, etc). If a large part of the support is for the children, then perhaps the children can rent the place. (/wild idea) Note that, in Ontario, there are two trusteeship decisions to make: 1) financial; and 2) personal care, which includes housing and medical. Someone can retain their own 'self-care' authority even if they're judged financially incapable (or vice versa if there's a personal-care or medical decision which they cannot understand). The technical language is, \"\"Mentally Incapable of Managing Property\"\" This term applies to a person who is unable to understand information that is relevant to making a decision or is unable to appreciate the reasonably foreseeable consequences of a decision or lack of decision about his or her property. Processes for certifying an individual as being mentally incapable of managing property are prescribed in the SDA (Substitute Decisions Act), and in the Mental Health Act.\"\" The Mental Heath Act is for medical emergencies (only); but Ontario has a Substitute Decisions Act as well. An intent of the law is to protect vulnerable people. People may also acquire and/or name their own trustee and/or guardian voluntarily: via a power of attorney, a living will, etc. I don't know: how about offering the landlord a year's rent in advance, or in trust? I guess that 1) a court order can determine/override/guarantee the way in which the child support payments are directed 2) it's easier to get that order/agreement if you and your ex cooperate 3) there are housing specialists in your neighborhood: They can buy housing instead of renting it. Or be given (gifted) housing to live in.\"" }, { "docid": "191428", "title": "", "text": "I don't see why not. Not everyone is going to be in a major sound stage, but look at people like That Guy With The Glasses group and some others. They're not rolling in dough, but some of them who are entertaining enough are getting a living off of what they do. All this really does is eliminate a middle man and put creators in more control, without the need for all the dollars. CK is an established talent, so he could afford to put in higher production values for a product. Another budding standup artist might only be able to do their garage and a camera, and charge maybe $0.50 - but if people like it enough, they'll be able to build up without the expense/hassle/control of a major label." }, { "docid": "545792", "title": "", "text": "I agree with you. I have many liberal viewpoints but over regulation is definitely not one of them. I work for a non profit health insurance company and a lot of the Affordable Care Act is something I am truly behind. However many things within it, I believe, are going to increase costs across the board for all of us. I hate to sound like Romney and say that regulation is of course needed but too much of it truly is doing more harm than good." }, { "docid": "72021", "title": "", "text": "The fluctuation of interest rates during the next year could easily dwarf the savings this attempt to improve your credit score will have; or the reverse is true. Will the loan improve your score enough to make a difference? It will not change the number of months old your oldest account is. It will increase the breadth of your accounts. Applying for the car loan will result in a short term decrease in the score because of the hard pull. The total impact will be harder to predict. A few points either way will generally not have an impact on your rate. You will also notice the two cores in your question differ by more than 30 points. You can't control which number the lender will use. You also have to realize the number differs every day depending on when they pull it that month. The addition of a car loan, assuming you still have the loan when you buy the house, will not have a major impact on your ability to get afford the home mortgage. The bank cares about two numbers regarding monthly payments: the amount of your mortgage including principal, interest, taxes and insurance; and the amount of all other debt payments: car loan, school loans, credit cards. The PITI number should be no more than 28%-33% of your monthly income; the other payments no more than 10%. If the auto loan payments fit in the 10% window, then the amount of money you can spend each month on the mortgage will not be impacted. If it is too large, then they will want to see a smaller amount of your income to go to PITI. If you buy the car, either by cash or by loan, after you apply for the mortgage they will be concerned because you are impacting directly numbers they are using to evaluate your financial health. I have experienced a delay because the buyer bought a car the week before closing. The biggest impact on your ability to get the loan is the greater than 20% down payment, Assuming you can still do that if you pay cash for the car. Don't deplete your savings to get to the 50% down payment level. Keep money for closing costs, moving expenses, furnishing, plus other emergencies. Make it clear that you can easily cover the 20% level, and are willing to go higher to make the loan numbers work." }, { "docid": "383012", "title": "", "text": "\"1. Internet is not a regular product or service, it's a utility. 2. An unregulated utility market simply leads to regional monopolies, because the companies privately own the infrastructure. That's exactly what we have. The cable companies cut up the country and generally stay out of eachother's turf, because it's more profitable than competition. This is the opposite of a capitalist market, by the way. They are now all billionaires from providing bear minimum service and avoiding any real competition. Instead of competing, they slowly build enough money until they can simply buy out their competitors. Comcast has gotten so rich it bought NBC and is now looking to buy TWC. 3. Fair competition for utilities requires rules that prevent the reigning company from blocking out competitors. This is called \"\"[Open-Access](http://en.wikipedia.org/wiki/Open_access_%28infrastructure%29)\"\", this is what they have throughout most of Europe. This doesn't happen here because the reigning monopolies use their billions to buy political influence in Washington DC via lobbyists, campaign fund raising, donations, etc... It is so effective, that the former chair of the FCC, Michael Powell, made a PSA bashing Open-Access competition rules and praising our monopoly system, saying it has resulted in the best internet in the world, which is of course a bold-faced, demonstrable lie. [Video used to be on youtube, can't find it anymore] 4. The root cause is an apathetic voter base who view Washington as too corrupt to even reform, which keeps the people who care about this issue the most away from the poles. This simply strengthens the power of the corporate lobbyists to control politics even more. 5. To take on these giants, you need to be a giant yourself, with tons of money to burn and a big reason to do it even though you'll probably lose money, since it's more like charity than a great business opportunity. The only ones who fit the bill are Google, and only because they have a vested interest in keeping the internet free, open, fast, robust and affordable. It also helps that they spent the past decade buying up fiber optic infrastructure.\"" }, { "docid": "327582", "title": "", "text": "SECTION | CONTENT :--|:-- Title | Deep Dive: Fixing Our Broken Food System Description | Making sure that everyone has access to safe, affordable, and healthy food, is a complex task. Consider the complicated production and distribution systems, both large and small, that need to balance environmental and labor concerns, with sometimes competing business priorities. Moving away from a system that incentivizes cheap, processed junk requires not only policy solutions, but creativity from both the private sector and the individual consumer. Failure to act has resulted in consequences... Length | 1:21:19 **** ^(I am a bot, this is an auto-generated reply | )^[Info](https://www.reddit.com/u/video_descriptionbot) ^| ^[Feedback](https://www.reddit.com/message/compose/?to=video_descriptionbot&subject=Feedback) ^| ^(Reply STOP to opt out permanently)" }, { "docid": "485460", "title": "", "text": "\"I was not aware of that. However, the rest of that article seems to point in Google's favor. > The public suffers under a monopolistic market because it does not have the quantity of goods or the low prices that a competitive market could offer. Doesn't apply. > ...the act only applies to those monopolies attained through abused or unfair power. Monopolies that have been created through efficient, competitive behavior are not illegal under the Sherman Act, as long as honest methods have been employed. Google may have 65% of the share of internet searches, but not the online travel booking business. You can't say they've cheated to win the search market, and you can't say they have a monopoly in the online travel booking business. > Once sufficient monopoly power has been proved, the Sherman Act requires a showing that the company in question engaged in unfair conduct. Finally, even if they were somehow declared a monopoly, you'd have to prove they were being unfair to competitors. Eliminating competitors from search results might be unfair, but just listing your own product at the top of the list seems a fairly weak argument. If the government says that Google's product at the top of the list is unfair, questions will then be raised about the entire order of the list. How far down should Google's listings be? Is this going to spread to all of Google's side-projects that show up in their search results? What if Google placed their listing in the paid advertising section? Is that still \"\"cheating\"\"? Does a company not have the right to show new products to its existing customers? I don't see Google losing this battle in court, but then, I don't even see it going to court. Google will go out of its way to appease the complainers.\"" }, { "docid": "573394", "title": "", "text": "\"Depending on what you mean by \"\"High-quality health insurance,\"\" it is part of the problem. If you don't care about price (because you are using your insurance pays for everything), providers will charge as much as your insurance will pay. Health insurance in this country turned into a poorly built health service subscription business because the government made it cheaper for your employer to provide you wages in the form of health insurance than in money. There are new health service business models popping up that are built as a health service subscription. Providers charge a flat monthly rate and you get to use as much as you want. The doctors and other service providers don't have to deal with insurance, and get to keep everything. Unfortunately, they are illegal in some states. Get the government out of the health services sector. End the subsidy for health insurance paid by employers, or provide the same subsidy for health services purchased by individuals. Allow any group to negotiate group coverage. Why is your health insurance tied to your job? Allow communities, extended families, or any organization to purchase group coverage. Stop requiring purchasing insurance services you don't want and will never use, like a gay men being required to purchase maternity insurance.\"" }, { "docid": "155876", "title": "", "text": "Depends on your company, I guess, because FP&A in our company doesn't do a significant amount of accounting. Take all of this with a grain of salt because I haven't been in the FP&A group, but if I were to rank how much accounting work is done by each finance group from most to least it would be [insert outsourced AP/AR/etc. here], controllers, tax, finance in the business (like embedded in another group), treasury, FP&A, then trading. Your company may be different, but in my company the FP&A team isn't really booking entries, even if they're looking into a lot of GL accounts to aid in their work. Are you trying to avoid SAP altogether, or do you want to stop doing research in it, or do you just want to stop booking debits and credits? Because almost every lower level role in finance as a whole is at least going to have the research and data gathering part in system, and that's primarily the extent of what FP&A does as far as their work in SAP. Treasury has more responsibility in SAP/other systems because we actually have to go correct entries or make some payments on occasion." }, { "docid": "222665", "title": "", "text": "Health insurance is tough, as you know, because the offerings vary dramatically by State, and there is the added complication of the Affordable Care Act, which depending on where and who you are has had either a good or bad impact on the available options. If you are a sole proprietor or other business person, I'd advise talking to someone at a local chamber of commerce. Also, professional organizations like the IEEE or ACM (for IT professionals) often offer catastrophic medical or other health plans. Some employer plans give you the option to continue coverage at a higher cost when COBRA lapses as well. If you can't afford a comprehensive plan, make sure to get something to protect you against pre-existing conditions or hospitalization." }, { "docid": "441155", "title": "", "text": "Schedule 13D (or the abbreviated version, schedule 13G) would be the most likely place to find this info. When a person or group of persons acquires beneficial ownership of more than 5% of a voting class of a company’s equity securities registered under Section 12 of the Securities Exchange Act of 1934, they are required to file a Schedule 13D with the SEC. Schedule 13D reports the acquisition and other information within ten days after the purchase. Any material changes in the facts contained in the schedule require a prompt amendment. You can find the Schedules 13D for most publicly traded companies in the SEC’s EDGAR database. A 1% change in the amount of ownership is considered material." }, { "docid": "209224", "title": "", "text": "EDIT To answer what I think you question is: I do not know of anything other than trip cancellation insurance. And you must be very careful that the policy you purchase for your trip covers the circumstance you described. Essentially, you opted not to take the flight. Not all trip cancellation policies will cover that. How to Find Trip Cancellation Insurance Getting Your Money Back Now This is an Act of God in the insurance world. You cannot reasonably expect the airline to know the future weather pattern anymore than you could, and therefore, since the plane did fly, you owe them the money based on the ticket you bought. You didn't just buy a ticket, there is a contract with rules about refunds and transferring and such. It is a bummer situation, and I understand you point of view, but this isn't the airline's fault. If anybody is to blame for you missing your flight, and therefore not getting a refund, it is your employer. Their requirements for you be in one city and then another are the cause. While your employer cannot predict the weather, they are ultimately the ones who could give you the okay to be late. If you absolutely cannot be late, and it was critical that you drive out and miss your flight, then your company gets to pay for the flight AND the car. That is the cost of doing business for them. This is also why, when flying for business, that you pay the higher price and get the refundable / transferable ticket. They cost more, but situations like these illustrate they are worth it for the company." }, { "docid": "119374", "title": "", "text": "Except, restricting how the economy can be controlled is a slippery slope into financial control of the nation by outside interests. The real issue is that every extreme becomes a problem, and trying to block every extreme is futile. Controls should impede, but not completely stop, extremes. The impedance method should return the force against it as support or growth for the nation. Financial growth of any outside interest connected to the government or in this country should bring more and more wealth into the nation, while slowing the growth of the financial extremes, but never stopping it. Special Interest groups need to return to the country a share of what they gain through their work with the government and our people. Religious groups should return money and support of the lower class. Women’s advocacy groups need to return value for their gains. The NRA needs to return value for its gains. The poorer populace should return work for the country in return for education, health care, housing, food, and wages. Harder and smarter work, better progress through education, should be rewarded with better benefits and eventual financial “freedom” (there is no true freedom in a world of limited resources and competition, so the idea of “true freedom” is ridiculous). We should, however, endeavor to give as much freedom as possible. There should be an uncomfortable minimum below which a person may only fall if they refuse to work and get educated." }, { "docid": "522619", "title": "", "text": "\"The Trustee has allowed me to act as his \"\"agent\"\", continuing to pay bills, and take care of much of the administrative affairs for my mother's estate since I did all of it for years before she passed away. I was not paid for any of this work. ... The expenses were more than $30K last year, and there is still a punch list to go this year. The trust should reimburse your expenses and deduct them on the trust tax return. Since the Trust owned the property in 2015, and I will receive ownership this month, can last year's expenses incurred for the Trust be deducted again future income for my property this year? Not exactly. The trust will file its own tax return and will report the income/loss attributed to the beneficiaries per the trust rules. What is attributed to you will flow to your Schedule E. From there you own it and if it is a passive activity where the loss is limited - you can carry it forward and offset with future gain. The trustee will have to deal with all the paperwork. Do 1099-misc forms need to be filed for the contractors who worked to get it ready for rental? It is my understanding that since 2010 (and before 2010) landlords who are not in real-estate trade or business are not required to send out 1099. But it won't hurt if you do, also. In any case - for all of these issues you should talk to a tax adviser (EA/CPA licensed in your State).\"" }, { "docid": "466718", "title": "", "text": "\"From the poster's description of this activity, it doesn't look like he is engaged in a business, so Schedule C would not be appropriate. The first paragraph of the IRS Instructions for Schedule C is as follows: Use Schedule C (Form 1040) to report income or loss from a business you operated or a profession you practiced as a sole proprietor. An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity or a hobby does not qualify as a business. To report income from a nonbusiness activity, see the instructions for Form 1040, line 21, or Form 1040NR, line 21. What the poster is doing is acting as a nominee or agent for his members. For instance, if I give you $3.00 and ask you to go into Starbucks and buy me a pumpkin-spice latte, you do not have income or receipts of $3.00, and you are not engaged in a business. The amounts that the poster's members are forwarding him are like this. Money that the poster receives for his trouble should be reported as nonbusiness income on Line 21 of Form 1040, in accordance with the instructions quoted above and the instructions for Form 1040. Finally, it should be noted that the poster cannot take deductions or losses relating to this activity. So he can't deduct any expenses of organizing the group buy on his tax return. Of course, this would not be the case if the group buy really is the poster's business and not just a \"\"hobby.\"\" Of course, it goes without saying that the poster should document all of this activity with receipts, contemporaneous emails (and if available, contracts) - as well as anything else that could possibly be relevant to proving the nature of this activity in the event of an audit.\"" }, { "docid": "286141", "title": "", "text": "This would clear out a lot more. 1) Leverage is the act of taking on debt in lieu of the equity you hold. Not always related to firms, it applies to personal situations too. When you take a loan, you get a certain %age of the loan, the bank establishes your equity by looking at your past financial records and then decides the amount it is going to lend, deciding on the safest leverage. In the current action leverage is the whole act of borrowing yen and profiting from it. The leverage factor mentions the amount of leverage happening. 10000 yen being borrowed with an equity of 1000 yen. 2) Commercial banks: 10 to 1 -> They don't deal in complicated investments, derivatives except for hedging, and are under stricter controls of the government. They have to have certain amount of liquidity and can loan out the rest for business. Investment banks: 30 to 1 -> Their main idea is making money and trade heavily. Their deposits are limited by the amount clients have deposited. And as their main motive is to get maximum returns from the available amount, they trade heavily. Derivatives, one of the instruments, are structured on underlyings and sometimes in multiple layers which build up quite a bit of leverage. And all of the trades happen on margins. You don't invest $10k to buy $10k of a traded stock. You put in, maybe $500 to take up the position and borrow the rest of the amount per se. It improves liquidity in the markets and increases efficiency. Else you could do only with what you have. So these margins add up to the leverage the bank is taking on." }, { "docid": "115419", "title": "", "text": "\"> they want to lower the standards we have for goods and services Their avowed goal is \"\"regulatory coherence\"\" but its [not being done in a good way](http://www.ciel.org/Publications/ToxicPartnership_Mar2014.pdf), its an attempt to sneak through a [huge long long list](http://www.ttip2014.eu) of bad ideas that would not fly in any kind of light of day, and then make them permanent, with special [eternal entitlements](http://tpplegal.files.wordpress.com/2012/05/isds-domestic-legal-process-background-brief.pdf) for multinational corporations, so permanent that future elections can not change them, nor can states individually protect people, their laws would be preempted to the extent that unaccountable trade tribunals [can order huge fines against countries and states for merely doing their jobs](http://www.italaw.com/sites/default/files/case-documents/italaw3206.pdf), because they impinge upon new suddenly materialized \"\"rights\"\" as perceived by the trade agreements. Almost nobody knows they are doing this. often countries dont realize that they have lost their rights to determine their policies, and then countries usually lose. There are SO many problems I don't know where to begin. > in part by opening up public services to private business? Privatization often goes badly. They are hiding that and portraying privatization as the only possible future. Well at the beginning, the prototypes FTAs, NAFTA and GATS mandated the privatization of most public services in countries that signed them, with services (everything you can't drop on your foot) especially some of the add on documents to GATS. That was in 1995. It contains a \"\"standstill\"\" (they all do) which said that countries could not change anything if it was a move back towards public ownership and control, in the case of services, they frame that as bad, as a theft from businesses.. So standstill typically says things like they can not create any new public services and [if there was any money involved in the market sector at all that it would have to be privatized](http://www.iatp.org/files/GATS_and_Public_Service_Systems.htm) in tiny steps. No going back to public services allowed. But of course, people dont know that and often don't believe it when told. For example, do you believe me when i tell you thats the reason US health care is so bad-? Can you see how and why they might lie about what they,, politicians, can do, can do about things because they want to win elections by promising things - like affordable health care- But also hide the ugly act [that they gave away the store](http://www.law.harvard.edu/programs/lwp/nafta.pdf) starting in 1995. The FTAs that we can read (the early ones) tried to do it by being undecipherable to non-experts- they are so complicated and ambiguous only a few people really know what they demanded, at least up until recently. Now they are top secret. Really secret. Only the 600 lobbyists have access. Now, a growing number of people, especially in Europe, seem to realize this is really scary and a red flag., but its not because the news was any help, its because of the net, the media - especially in the US, has been completely unhelpful. They dont cover this at all. TTIP is a huge controversy. But I have a feeling the worst one is TiSA, which has remained largely out of the news. Except for Wikileaks and the financial services chapter. Just one chapter is known. And its an old version. Now they want in TiSA to greatly [expand the scope of these FTAs to millions of service jobs](https://www.youtube.com/watch?v=2_pPqnbXpA4) in a huge number of countries. Countries want things, like the US wants to be able to charge more money for drugs and they want to force other countries to allow US companies into their markets, for example, insurance, or financial instruments, it seems that they are trying to deregulate banking when it should be re-regulated to avoid a repeat of the 2008 GFC. Another thing the US wants is to limit generic drugs and make it easier for companies to open factories, send contractors, etc. elsewhere. Its not always a good thing to open markets up to \"\"liberalisation\"\". In many cases, it could lead to substantial job losses, as it has in [Central America after CAFTA](http://citizen.typepad.com/eyesontrade/2014/08/central-america-crisis-belies-caftas-empty-promises.html).\"" }, { "docid": "122227", "title": "", "text": "Sure these groups suck ass but Paypal should act as a utility. Otherwise where do you draw the line? Do all businesses become politically driven entities? Do lobbyists start drilling for dirt and reasons to pull services form their competitors, or even make it up? I get **this** is good, and usually I'm not a fan of the slippery slope style arguement, though in this situation for what is largely an essential service it seems valid." }, { "docid": "327127", "title": "", "text": "\"Without any highly credible anticipation of a company being a target of a pending takeover, its common stock will normally trade at what can be considered non-control or \"\"passive market\"\" prices, i.e. prices that passive securities investors pay or receive for each share of stock. When there is talk or suggestion of a publicly traded company's being an acquisition target, it begins to trade at \"\"control market\"\" prices, i.e. prices that an investor or group of them is expected to pay in order to control the company. In most cases control requires a would-be control shareholder to own half a company's total votes (not necessarily stock) plus one additional vote and to pay a greater price than passive market prices to non-control investors (and sometimes to other control investors). The difference between these two market prices is termed a \"\"control premium.\"\" The appropriateness and value of this premium has been upheld in case law, with some conflicting opinions, in Delaware Chancery Court (see the reference below; LinkedIn Corp. is incorporated in the state), most other US states' courts and those of many countries with active stock markets. The amount of premium is largely determined by investment bankers who, in addition to applying other valuation approaches, review most recently available similar transactions for premiums paid and advise (formally in an \"\"opinion letter\"\") their clients what range of prices to pay or accept. In addition to increasing the likelihood of being outbid by a third-party, failure to pay an adequate premium is often grounds for class action lawsuits that may take years to resolve with great uncertainty for most parties involved. For a recent example and more details see this media opinion and overview about Dell Inc. being taken private in 2013, the lawsuits that transaction prompted and the court's ruling in 2016 in favor of passive shareholder plaintiffs. Though it has more to do with determining fair valuation than specifically premiums, the case illustrates instruments and means used by some courts to protect non-control, passive shareholders. ========== REFERENCE As a reference, in a 2005 note written by a major US-based international corporate law firm, it noted with respect to Delaware courts, which adjudicate most major shareholder conflicts as the state has a disproportionate share of large companies in its domicile, that control premiums may not necessarily be paid to minority shareholders if the acquirer gains control of a company that continues to have minority shareholders, i.e. not a full acquisition: Delaware case law is clear that the value of a dissenting [target company's] stockholder’s shares is not to be reduced to impose a minority discount reflecting the lack of the stockholders’ control over the corporation. Indeed, this appears to be the rationale for valuing the target corporation as a whole and allocating a proportionate share of that value to the shares of [a] dissenting stockholder [exercising his appraisal rights in seeking to challenge the value the target company's board of directors placed on his shares]. At the same time, Delaware courts have suggested, without explanation, that the value of the corporation as a whole, and as a going concern, should not include a control premium of the type that might be realized in a sale of the corporation.\"" } ]

[ { "docid": "328863", "title": "", "text": "\"Assuming you file state tax returns, you shouldn't buy Basic. Ever. Your choice is probably between the \"\"Premier\"\" version and the \"\"Business and Home\"\" version. Price difference is insignificant (I have a comparison on my blog, including short descriptions as to who might find each version useful the most). The prices have gone down significantly, since when I wrote the article, its cheaper now.\"" } ]

[ { "docid": "120523", "title": "", "text": "I have fairly simple tax returns and my experience was that TurboTax software produced roughly the same result as human accountant and costs much less. The accountant was never able to find any deductions that the program couldn't find. Of course, if you have business, etc. you probably need an accountant to help you navigate all the rules, requirements, etc. But for simple enough cases I found that the additional pay is not justified." }, { "docid": "174025", "title": "", "text": "You are right that even if you do not receive a 1099-MISC, you still need to report all income to the IRS. Report the $40 on Schedule C or Schedule C-EZ. Since your net profit was less than $400, you do not need to file Schedule SE. From the IRS web site: Self-Employment Income It is a common misconception that if a taxpayer does not receive a Form 1099-MISC or if the income is under $600 per payer, the income is not taxable. There is no minimum amount that a taxpayer may exclude from gross income. All income earned through the taxpayer’s business, as an independent contractor or from informal side jobs is self-employment income, which is fully taxable and must be reported on Form 1040. Use Form 1040, Schedule C, Profit or Loss from Business, or Form 1040, Schedule C-EZ, Net Profit from Business (Sole Proprietorship) to report income and expenses. Taxpayers will also need to prepare Form 1040 Schedule SE for self-employment taxes if the net profit exceeds $400 for a year. Do not report this income on Form 1040 Line 21 as Other Income. Independent contractors must report all income as taxable, even if it is less than $600. Even if the client does not issue a Form 1099-MISC, the income, whatever the amount, is still reportable by the taxpayer." }, { "docid": "43647", "title": "", "text": "I know this is rather late, but with your income it is almost certainly better for your mother to claim you as a dependent. I was in a similar situation this last year, I didn't get the full weight of the tax break because my taxes went down to zero with this exemption along with claiming myself as a dependent. I used Turbotax to run both our taxes both ways to verify, the difference was about 1000 dollars saved for my parents to claim me as a dependent vs claiming myself as a dependent. If you are unsure it doesn't take long to run the numbers through Turbotax, TaxACT, or some similar software." }, { "docid": "373274", "title": "", "text": "Are you looking to get a quote before you decide exactly what you’re going to do with your next paint job in Vancouver? Give our home painting contractors a call and make an appointment – we can help you to figure out what you’re getting yourself into so that you can work out a budget-friendly plan that makes sense for all of your needs. http://barwickpainting.com/about-us/" }, { "docid": "28683", "title": "", "text": "Assuming you're talking about your United States Federal Income Tax payment or refund, the IRS has a website for checking the status of your refund. You can check that site to see where your refund is. If it doesn't show up on that site (assuming you provide all the information correctly), then you may want to check TurboTax to verify it was correctly submitted. I believe that site also works for payments. If not, Turbotax's page is not refund-specific (though I suspect it is just an API call to the same tool)." }, { "docid": "529509", "title": "", "text": "\"You probably entered it wrong in TurboTax. Distribution code \"\"2\"\" should have triggered some more questions in the TurboTax, but I don't know exactly how it works there. Bottom line is that you need to add form 8606 to your return. Here's something on Intuit forums that tells you how to get to it.\"" }, { "docid": "143728", "title": "", "text": "\"Not unless you have something else to put up as collateral. The bank wants a basic assurance that you're not going to immediately move the money to the Caymans and disappear. 999 times out of 1000, the collateral for a home mortgage is the home itself (which you wouldn't be able to take with you if you decided to disappear), so signing up for a 30 year mortgage on a nonexistent house is probably going to get you laughed out of the bank. It's sometimes possible to negotiate something else as collateral; you may, for instance, have a portfolio of securities worth the loan principal, that you can put in escrow for the term of the loan (the securities will stay in your name and make you money, but if you default on the loan the bank goes to the escrow company and takes the portfolio for their own). The bank will consider the risk of value loss on the securities in the portfolio, and may ask for a higher collateral value or only allow a lower loan amount. In all cases, it's usually a bad idea to go into long-term personal debt just to get \"\"cheap money\"\" that you can use to beat the interest rate with some business plan or investment. If you have a business plan, take that to the bank with an LLC and ask for a business loan. The business itself, if the plan is sound, should become valuable, and the terms of business loans take that into account, allowing for a \"\"shrinking collateral\"\" transferring the initial personal risk of the loan to the business.\"" }, { "docid": "211869", "title": "", "text": "is it possible to file that single form aside from the rest of my return? Turbotax will generate all the forms necessary to file your return. I recommend you access these forms and file them manually. According to the IRS in order to report capital gains and losses you need to fill out Form 8949 and summarize them on Form 1040 D. Add these two forms to the stack that turbotax generates. Add the total capital gains to line 13 of the Form 1040 which turbotax generated, and adjust the totals on the form accordingly." }, { "docid": "195571", "title": "", "text": "You will almost certainly be paying taxes in Czech Republic, short of being American of Eritrean, citizenship has little to no bearing on tax. If you are working from home, you will probably be a contractor. In Romania you would work through either an SRL or you would set up a PFA. Essentially a limited company or a sole trader. You will need to find the Czech equivalents. I would advise finding a small business accountant. They will be able to advise what is the most cost effective solution, in some countries (like my one) you can save considerable amounts of tax by working through a company. There is a link with some information." }, { "docid": "88770", "title": "", "text": "The exact answers depend on what you're going to do and what you started with and what your local market is like ... But a bit of websearching (and/or asking a good general contractor) will yield a table of typical improvement in sale price from various renovations. One thing you'll discover is that unless you are staring with something almost unsellable, few if any if thgem return more than you paid for them; getting back 85% is exceptionally good. A possible exception is energy-saving measures; basic air-seaking and attic insulation improvements pay back their cost relatively quickly, and solar can do so if you have a decent site for that -- and these are often subsidized in one way or another by government or utilities. For most things, thoiugh, the real answer is to ask yourself what would make the house better for you and your family, and what that would be worth to you. If you can get it done for less than that, go for it. It's a good idea to put together as complete a list vas possible before starting, since some will be considerably less expensive if done in the right order or at the same time. (Redo your roofing before installing rooftop solar panels, if possible; as one example.) Then prioritize thiose by what will improve your enjoyment of the house most. You'll probably get better specific advice over in the Home Improvement area of Stack Exchange." }, { "docid": "287493", "title": "", "text": "After few years your building needs renovation. However steel building kits can be a great choice for upgrading your sweet home. If not, hire one experienced local contractor from Universal Steel of America to build your metal building quickly and affordably." }, { "docid": "456234", "title": "", "text": "As someone who used to be an IT contractor in the UK and used to work from home, my advice is to talk to your accountant in detail. It's been a few years, but IIRC you can write off some small stuff like proportional heating costs etc, but in my case it was so minuscule that it wasn't worth the effort. You're likely better off to just leave it. <subliminal message> Talk to your accountant :). </subliminal message>" }, { "docid": "86134", "title": "", "text": "Not authoritative, but according to TurboTax: If your new cell phone acts as both your business and personal phone, you are only allowed to deduct the portion used for business from your taxable income. It’s important for you to hang on to your itemized phone bill and receipts to ensure that you’re deducting the right amounts and to keep records of your deduction. Since the usage you're describing sounds like a very small amount of the overall usage, it will probably be difficult to justify a business expense deduction." }, { "docid": "223170", "title": "", "text": "Since your YouTube income is considered self-employment income and because you probably already made more than $400 in net income (after deducting expenses from the $4000 you've received so far), you will have to pay self-employment tax and file a return. This is according to the IRS's Publication 17 (2016), Your Federal Income Tax, so assumes the same rules for 2016 will remain in effect for 2017: You are self-employed if you: Carry on a trade or business as a sole proprietor, Are an independent contractor, Are a member of a partnership, or Are in business for yourself in any other way. Self-employment can include work in addition to your regular full-time business activities, such as certain part-time work you do at home or in addition to your regular job. You must file a return if your gross income is at least as much as the filing requirement amount for your filing status and age (shown in Table 1-1). Also, you must file Form 1040 and Schedule SE (Form 1040), Self-Employment Tax, if: Your net earnings from self-employment (excluding church employee income) were $400 or more, or You had church employee income of $108.28 or more. (See Table 1-3.) Use Schedule SE (Form 1040) to figure your self-employment tax. Self-employment tax is comparable to the social security and Medicare tax withheld from an employee's wages. For more information about this tax, see Pub. 334, Tax Guide for Small Business. I'd also note that your predicted income is getting close to the level where you would need to pay Estimated Taxes, which for self-employed people work like the withholding taxes employers remove their employees paychecks and pay to the government. If you end up owing more than $1000 when you file your return you could be assessed penalties for not paying the Estimated Taxes. There is a grace period if you had to pay no taxes in the previous year (2016 in this case), that could let you escape those penalties." }, { "docid": "201954", "title": "", "text": "If it's a legitimate cost of doing business, it's as deductible as any other cost of doing business. (Reminder: be careful about the distinctions between employee and contractor; the IRS gets annoyed if you don't handle this correctly.)" }, { "docid": "71186", "title": "", "text": "\"Horseshit, for one it isn't the CEO that has to be a minority in these preference contracts it's the shareholders so we know you're full of shit. Second, no company is *banned* under any of these schemes because of the race of even shareholders. Even the suggestion is fucking ridiculous because that would clearly violate the 14th amendment. The federal gov and state governments have TONS of vendors for which a small percentage they've decided they want to make a conscious effort of hiring minority and women owned contractors. THIS DOES NOT MEAN THEY WILL NOT ACCEPT WHITE CONTRACTORS. It means that after bids are submitted they might still consider a minority or women owned bid that doesn't come in at the lowest price. In any case it's usually a small sliver of total contracts. If you're wondering why they do this for minorities and women, they do it for a bunch of different categories including veterans and small businesses. It's a feel good story. Your company did not lose a contract because your CEO is white, that is just a fucking lie. Your company might have lost a bid to a woman or minority owned contractor. To which, I say \"\"tough.\"\" You might have lost the contract anyway to another bidder. Maybe your work wasn't as good as you say. We have no way to know without knowing your bid and their bid and if they are in fact minority owned. So as of now you're just some guy bitching about losing his job on the internet. Go somewhere with that bullshit.\"" }, { "docid": "437178", "title": "", "text": "\"Says who? Or is this just something you *think* makes sense, because on first glance it does. Many studies show privatizing basic government functions like waste removal, prisons etc. to contractors ends up costing the government more. Recent study that shows that its more expensive: http://www.nytimes.com/2011/09/13/us/13contractor.html Specifically on government military private contractors, via this link, bottom of the page: http://www.pbs.org/wgbh/pages/frontline/shows/warriors/contractors/ceff.html Steven Schooner Professor, The George Washington University Law School; expert on government contracting \"\"I don't think there's any question that no one knows whether it's cheaper or not. One of the best studies we've seen on whether outsourcing saves money is the RAND study, which is now a few years old. And what the RAND study says is there's the potential for immense cost-saving in outsourcing. But it hasn't been proven yet. There's a number of episodic studies since, but there has not been a compelling case made that government outsourcing, particularly this type of outsourcing, saves money.\"\" Full interview: http://www.pbs.org/wgbh/pages/frontline/shows/warriors/interviews/schooner.html He makes your point however that the savings is thought to come from savings in paying someone before and keeping them on payroll when we're not in a military activity that requires their services. No pension after, no payroll before. Thus the increase in compensation is a lot higher. However it doesn't mean its conclusive to show that it *does*save money.\"" }, { "docid": "223583", "title": "", "text": "It is unfortunate to think that people determine as a result of paying a living wage they need to illegally undercut their employees. If your business model cannot succeed by paying living wages then you need to rethink your business model. $12/hour is not luxury. That is still close to poverty for a family of 3. Take home would not afford an apartment, gas, food, utilities, etc for a single person without having roommates. People deserve to afford their basic needs without getting government assistance when working full time." }, { "docid": "595919", "title": "", "text": "Successful technology contractors* make far more than employees. The contractor market is getting oversaturated because more people want to do it and employers like it less and less. Problem is, the only time big employers are willing to hire contractors are when they're really good, so you really only get well paid contractors who find consistent work, and then a flood of contractors that have to get whatever work they can find." } ]

[ { "docid": "578529", "title": "", "text": "This is all answered in the prospectus. The money not yet invested (available/committed to a note but not yet funded) is held in pooled trust account insured by FDIC. Money funded is delivered to the borrower. Lending Club service their notes themselves. Read also my reviews on Lending Club." } ]

[ { "docid": "349466", "title": "", "text": "I had the same experience as Jeremy: made investments in both Prosper and Lending Club and got a much better returns with Lending Club, although in my cases both investments were ok: after 18 months i made 4-5% on prosper and 11-12% on Lending Club. I think they just have better underwriting standards." }, { "docid": "113033", "title": "", "text": "I've been a P2P Lending investor for ~18 months now with Lending Club with no complaints. Money wise, I'm making a 15.6% NAR w/ ~270 notes. I've had a few late payers, and one couple (oddly enough in both are in law enforcement) declare Ch.13 Bankruptcy, but b/c I've invested as little money as possible into each note ($25/note), my diversification helps reduce volatility and risk to capital. Having tough underwriting standards is very important, but I think it all comes down to loaning only to those you think will pay you back, not someone with a sob story or a long history of defaults. That might sound like a no-brainer, but if you're a bit of a cynic and have really tough screening criteria, it's possible to lower your default rate if you're patient and deploy your money slowly over time. At least, my returns and default rate of zero would imply it's possible so far. I blog about it quite a bit, so if anyone wants to check out my Lending Club investments thus far, please check it out. (Apologies if this is considered spam since I'm a new member of the site, but thought it relevant to the discussion.)" }, { "docid": "80464", "title": "", "text": "A 'bailout' is money from the government to keep open a business that is no longer viable and by rights deserves to fail. What happened in this case was different. All banks rely on the overnight bank lending market for liquidity. It is the grease that oils the wheels of international banking. That is not a sign of weakness or recklessness. It is just standard banking practice. In 2008, during the failure of Bear Stearns and the Lehman Shock the overnight lending market simply stopped operating as nobody knew who they could trust and as a result nobody trusted anybody. Something needed to temporarily replace this overnight lending until the crisis was over. This is what that cash infusion was. It was not a bailout." }, { "docid": "161890", "title": "", "text": "\"in undergrad business, you will have a broad scope of information to cover, and schools and professors will vary widely in how they approach it. it will be hard to say for certain how you can edge out your peers before knowing what they are looking for. however, finance and business are intellectually nebulous, especially at the undergrad level. your best bet is to maintain a broad set of interests and stay well read on them. i would recommend watching Bloomberg fairly regularly, opening a brokerage account and taking advantage of the reps you can talk to, and reading news like The Atlantic and Washington Post, among others, as long as they are well reasoned and contemporary accounts. classic and modern economics books will give you superior frameworks in which to look at the \"\"smaller\"\" world of finance, which should set you apart from your peers as well.\"" }, { "docid": "305855", "title": "", "text": "I think you're missing several key issues here. First for the facts: IRA contributions are $5500 a year maximum (currently, it changes with inflation), i.e.: you cannot deposit $10K in an IRA account in a single year. IRA withdrawals can only be made if you have something liquid in the IRA. You cannot withdraw from Lending Club IRA unless you manage to sell the notes currently held by you there. Roth IRA is funded with after-tax money, and you can withdraw your deposits in Roth IRA any time for any reason. No 10K limit there, only limited by what you deposited. However the main thing you're missing is this: You can withdraw up to $10K from your IRA for first home purchase without penalty. Pay attention: not without tax but without penalty. So what is the point in depositing $10k into IRA just to withdraw it the next year?" }, { "docid": "194240", "title": "", "text": "\"One idea: If you came up with a model to calculate a \"\"fair price range\"\" for a stock, then any time the market price were to go below the range it could be a buy signal, and above the range it could be a sell signal. There are many ways to do stock valuation using fundamental analysis tools and ratios: dividend discount model, PEG, etc. See Wikipedia - Stock valuation. And while many of the inputs to such a \"\"fair price range\"\" calculation might only change once per quarter, market prices and peer/sector statistics move more frequently or at different times and could generate signals to buy/sell the stock even if its own inputs to the calculation remain static over the period. For multinationals that have a lot of assets and income denominated in other currencies, foreign exchange rates provide another set of interesting inputs. I also think it's important to recognize that with fundamental analysis, there will be extended periods when there are no buy signals for a stock, because the stocks of many popular, profitable companies never go \"\"on sale\"\", except perhaps during a panic. Moreover, during a bull market and especially during a bubble, there may be very few stocks worth buying. Fundamental analysis is designed to prevent one from overpaying for a stock, so even if there is interesting volume and price movement for the stock, there should still be no signal if that action happens well beyond the stock's fair price. (Otherwise, it isn't fundamental analysis — it's technical analysis.) Whereas technical analysis can, by definition, generate far more signals because it largely ignores the fundamentals, which can make even an overvalued stock's movement interesting enough to generate signals.\"" }, { "docid": "390359", "title": "", "text": "\"I invested in Prosper.com loans. I'm getting out. I only have about $37 left, and as the principal is doled back to me, I withdraw the money. The default rate I experienced was over 30%. Only six of the 53 loans I invested in were with borrowers whose credit rating was less than \"\"A.\"\" Borrowers with a rating of \"\"A\"\" and \"\"AA\"\" had a higher proportion of defaults that those below \"\"A\"\". Some of my blogging colleagues were wise enough not to start this game. Some who invest in other P2P lending are almost certainly doing it with \"\"found money.\"\" They post articles with affiliate links. As people sign up, they get the commissions deposited in their accounts, which they invest. As they update their blogs with the returns on their portfolio, it serves to encourage more signups, and the machine continues on. Even if they lose money on the invested loans, they're still ahead. To paraphrase John Chow's tagline: They make money with Lending Club by telling people how much money they're making with Lending Club. It's almost like investing with the house's money. My high default rate might be because I started earlier in the game. Borrower screening and criteria have gotten tighter with time. I don't recommend investing in P2P loans. My experience has been that a large percentage of borrowers requesting loans on these sites have run out of options, which the credit reporting doesn't reflect accurately enough.\"" }, { "docid": "551009", "title": "", "text": "Payday loan companies basically are banks (although they are incredibly terrible ones). Banks make money in two ways: (1) They charge fees for services they provide (bank account fees, etc.); and (2) The interest rate differential: They borrow money from individuals and corporations (your savings account is essentially money you are loaning to the bank) for a small % paid to individuals, and then lend that money back to other people for a higher %. ie: You might earn 0.5% on your savings account, but then the bank takes that money and lends it to your neighbor for 2.5% as part of their mortgage. Payday loan companies make money in one way: They charge an enormous markup on money lent out to other people. The rates in some cases are so high (annualized interest rates of >1000% are not uncommon in countries without full regulation of this industry), that it barely matters where they get money from. They might get money from investors [who bought shares in the company, giving the company initial cash in the hope that they give dividends down the road], they might get money from other 'real' banks [who lend money just like they would lend money to any other business, with a regular interest rate], or they might have many from many other sources. They might even issue their debt publically, so that individuals could buy bonds from the company and receive a small amount of interest every year. The point is that the rates of return on the money leant by payday loan companies are so high, that the cost of where the money comes from is not terribly relevant." }, { "docid": "578983", "title": "", "text": "The yield on treasury bond indicates the amount of money anyone at can make at virtually zero risk. So lets say banks have X [say 100] amount of money. They can either invest this in treasury bonds and get Y% [say 1%] interest that is very safe, or invest into mortgage loans [i.e. lend it to people] at Y+Z% [say at 3%]. The extra Z% is to cover the servicing cost and the associated risk. (Put another way, if you wanted only Y%, why not invest into treasury bonds, rather than take the risk and hassle of getting the same Y% by lending to individuals?) In short, treasury bond rates drive the rate at which banks can invest surplus money in the market or borrow from the market. This indirectly translates into the savings & lending rates to the banks' customers." }, { "docid": "566745", "title": "", "text": "\"I invested a small amount of money with Prosper, and later with Lending Club. I don't know why there is such a discrepancy, but over half of my Prosper loans defaulted, while only 1 of my Lending Club loans has defaulted so far. I think that P2P lending is for \"\"early adopters\"\" right now. There are regulation issues, transparency issues, legal issues, etc. Once all of those issues get worked out, I think that P2P lending will eventually overtake conventional lending, and it will be more profitable for both the lender and the borrower. The Internet is simply eroding the value that banks are adding to the process (primarily aggregation of funds), and the system has to change.\"" }, { "docid": "77088", "title": "", "text": "Well, to get money, you need to leverage your assets. So your options basically are: - Asset: Cash. Well, I figure if you had, you wouldn't have asked how to get more of it, but its always worth mentioning. Don't forget about cash that can be in tricky places to tap, like 401ks, IRAs, investment accounts, etc. There is usually some way to get at the cash, but it may not be worth it and you could end up sacrificing long term financial stability if you do. - Asset: Job Skills and Initiative. Get a job and and earn the cash. $2k is not a ton, and if you live frugally you should be able to save it. There are tons of websites dedicated to living frugally and earning extra cash on the side. My personal favorite is r/beermoney. - Asset: Good Credit. Borrow the money from a traditional bank. Signature loans go up to $35k at most banks, just ask what it would take to qualify. You could also get a credit card for that amount, and use it to start up the business. - Asset. Bad Credit. If you've got bad credit, you can still take out a loan from a place like Prosper or Lending Club or Sofi (these places are handy if you have good credit, too). Your rates will be much higher, but they will still lend to you. - Asset: Property. If you own stuff, you can sell it and get cash. Clean out your attic (or ask relatives if you can have the stuff in theirs!) and sell it. If you own fancy stuff, you can borrow against it (home, car, boat, etc.). - Asset: Your Charm and Winning Smile. If you have a good, solid business plan (written down and professional looking), ask around and see if you can find an investor. It could be friends or family, but it could also be someone who is looking to invest. Be professional, and be sure to draw up the appropriate business docs if you do a partnership or take a private loan. - Asset: Your Government. If you live in the US, there are federal programs that offer Small Business Loans. Check out sba.gov for more info. You will need a business plan and will have to meet the criteria of the loan or grant. Not sure if your Ecommerce business will meet the criteria, as the intent of these types of programs are to spur the economy by allowing small business owners to hire workers. But its worth checking out." }, { "docid": "264160", "title": "", "text": "\"I started with lending club about a year ago. I love it. It has been insightful. Off topic, but I am in a loan to a guy who make 120K a year and is regularly late and has a pretty high interest rate. Crazy. You gain some economies of scale by going with a bigger note. I have $100 notes that I get hit for 2 or 3 cents for a fee, where $25 notes are always a penny. However, I don't think that should be your deciding factor. I scale my note purchases based on how much I like the status of the borrower. For example, I did $100 (which is currently my max) for a guy with a reasonable loan amount 16K, a stable work history (15+ years), a great credit history, and a great interest rate (16.9%). If one of those things were a bit out of \"\"whack\"\". I might go $50, two $25. I prefer 36 month notes, really 5 years to get out of debt? It is unlikely to happen IMHO. Keep in mind that if you invest $100 in a loan, then you get one $100 note. You can't break them up into 4 $25 notes. For that reason, if you are likely to want to sell the note prematurely, keep it at $25. The market is greater. I've had a lot of success using the trading account, buying further discounted notes for people who want out of lending club, or get spooked by a couple of late payments and a change in billing date. Another advantage of using the trading account is you start earning interest day 1. I've had new notes take a couple of weeks to go through. To summarize: There are some other things, but that is the main stuff I look at.\"" }, { "docid": "268747", "title": "", "text": "Use one journal entry, and split the expenses into the appropriate accounts. This can happen even if you never mix business and personal on the same receipt: say you order office supplies (which where I live are immediately deductible as an expense) and software or hardware (which must be depreciated because they are assets) on the same order. We have an account called Proprietors Loan which represents money the company is lending to the humans who own it, or that the humans are lending to the company. Were I to pay for my personal lunch on a business credit card, it would go through that account, increasing the amount the company has lent me or decreasing the amount I have lent it. Similarly if I made a business purchase with a personal card it would go through that account in the other direction. Where I live, I can lend my company all the money I want any time, but if the company lends me money there can't be an outstanding balance over the corporate year end. If you make two credit card entries of 5 and 10 when you go to reconcile your accounts it will be harder because you'll have to realize they together match the single 15 line on your statement. Making a single entry (your A option) will make reconciling your statement much easier. And that way, you'll probably reconcile your statements, which is vital to knowing you actually recorded everything." }, { "docid": "446464", "title": "", "text": "&gt; Allowing taxi licencing to become so expensive, than it places that level of debt on the owner is sheer madness - a recipe for a bubble. Yeah. We're basically artificially sustaining a lending business because we've created the necessity to lend for something that shouldn't be expensive in the first place. I think it's natural that in trying to clean up the bloat in the economy, there will undoubtedly be winners and losers." }, { "docid": "549741", "title": "", "text": "\"Wrong. Business lending has boomed under QE.. does the term \"\"cov-lite\"\" sound familiar? That's because there's so much liquidity, that they're willing to lend to companies with little to no restrictions. There is so much credit to go around, that a \"\"High Yield Bond\"\" can price at L+800 bps. When you're taking all the risk of a HY issuer, and maxing your return at 8.5%-9%, it's not too appealing. Instead, you could take a bit more risk, but also get all of the potential upside of equities. 1. Fed buys assets, injects money into banks. 2. Banks, flush with liquidity, need to put their balance sheet to use and begin lending to everyone. 2. Bond market flooded with supply, causes bond yields to drop to historic lows. 3. Investors don't enjoy limiting upside for incredibly low returns, and begin flooding equity markets to get some sort of yield. Business lending is booming, making equities the only place to get larger returns.\"" }, { "docid": "517268", "title": "", "text": "It's complicated. Really, there's no solid answer for your question. Everybody's risk tolerance and time horizon is going to be different. Those who can take on more risk can take on lower-grade C-G loans at Lending Club. Those with less risk tolerance should emphasize As and Bs." }, { "docid": "180690", "title": "", "text": "I have my own top 10 list, coming straight from the management of Semco. 1 - Values I write a lot on this blog about the importance of values, and I feel there is no exception here. Ricardo fundamentally believes in human equality and the importance of each individual, otherwise there is no way he could commit to such a mission. These values originated from him, but they've now permeated throughout the organization and every individual believes in them. 2 - Consistency This is an extension of values, because when your values are solid and clear, your behaviors and actions will flow from that. There are no contradictory policies that would confuse employees. Everyone is equal and all aspects of the organization from salary, profit sharing, job titles, power, working hours, leadership, and vacations reflect that. 3 - Peer Pressure There is nothing more effective for keeping order than peer pressure. All the rules in the world can’t replace the power of your friends and colleagues holding you accountable. It’s much more meaningful than a top down approach. The pressure is real, it has teeth since peers can come together and fire employees that aren’t doing their job. 4 - Profit Sharing Touchy feely open management is nothing without something real to back it up, and 23% pre-tax profit sharing is as real as it gets. Everyone is motivated because they know they will get rewarded for their hard work, and it also ensures that peer pressure is working well. They also get creative with this, giving employees the option of deferring 25% of their salary until the end of the year, at which time they might get a bonus resulting in a 150% of their original salary depending on the business unit’s performance. 5 - Empowerment Giving people freedom and responsibility without the tools to get things done is a recipe for disaster. All opinions are heard and there is value in the work of every employee.Nobody has an excuse for why they can’t get things done. 6 - Small Business Units Each business unit is small enough so that everyone involved understands everything that is going on and the outcomes.No way people can self organize if a unit is hundreds of people large.The magic number for the maximum effective size for a group is 150 and Semco will not allow a business unit to go beyond that. 7 - Total Transparency Semco goes to great lengths to ensure everyone knows how their financials are, even to the extent of displaying them in an easy to understand cartoon. There are no secrets, and this demonstrates trust and respect. 8 - No Symbols of Inequality There are no offices with huge windows, reserved parking spaces or other symbols that clearly show differences between employees.Everyone plays by the same rules, and everyone feels valued. 9 - Purpose Purpose is the cheapest way to align an organization. When everybody feels their works is valuable, they know why they are doing it and take pride in it, things naturally align themselves. Everyone feels like they are part of something important. 10 - Long Term Thinking/Private Company Can you change corporate culture in a few days, months, even years?Likely not, particularly if it is deeply ingrained. Also, how quickly do managers resort to short term solutions such as layoffs, budget cuts or other forms of control to try and reduce expenses the moment things go badly? Even under deep pressure, the company must stay the course and believe in the value of the open system. You can bend but you can’t break and revert to old school management. With private companies this is probably a lot easier than with public companies that are measured on quarterly performance. full post here: http://orgeffectiveness.ca/post/33166914205/the-most-radical-workplace-in-the-world-and-10-reasons" }, { "docid": "111240", "title": "", "text": "\"Traditional banks don't put their money onto the stock markets. In fact, the economic crisis was in part caused by the fact that banks were placing money into higher-risk portfolios and doing just that: in the UK there has been a debate for the last few years specifically around \"\"firewalling\"\" retail and investment bank operations entirely. What I was discussing was in the retail/consumer sector where the money comes in as mortgages &amp; secured loans and - slightly riskier - unsecured credit, credit cards, etc. In that model, you do not need to be a genius. If I lend you $20k to buy a car and you don't repay me my money plus 8%, I get the car and therefore am unlikely to be seriously out of pocket. The only thing I have to do is make sure I lend to people likely to repay more often than I do to those who will not. And that, well, that's something we've got a few hundred years of experience with... If I walk onto the NYSE and start throwing around my cash at put option on exotic FX markets that are in turn responding to conditions almost impossible to truly understand, well, I'm sure we'd agree that it's hard to beat the market. That's why the investment banks who specialise in that market don't invest their own money: they make money from investing other people's cash. Clever guys. So we need to understand here there are two very different kinds of banks, with two very different business models, and it was the mixing of them that led to the disaster we've seen. Firewalling them makes sense to me! Communists who think banks are making money out of thin air don't seem to understand that, and so it's not surprising that they seem confused about what a bank is actually there for. Those who do get these two models must see that a retail bank is there to provide finance based on savings held and investment banks are there to help people invest in riskier markets. That does not mean they are \"\"magic\"\" or \"\"evil\"\". Now, they might argue that fractional reserve banking is a problem. I would imagine many of them would prefer the credit union model instead, but that's a different debate: that's the mechanics and detail, not the institutional need for existence.\"" }, { "docid": "377065", "title": "", "text": "For real! /u/aolsux00 doesn't know what a primary source or peer-reviewed study is, but he has the gall to call other people uneducated in his other comments. But just for fun, I went through those articles and read the studies they indirectly cite. [Spoiler alert: none of them fully support his claims](https://www.reddit.com/r/business/comments/6pujj4/economy_needs_workers_but_drug_tests_take_a_toll/dkt5pn2/)" } ]

[ { "docid": "77352", "title": "", "text": "The best description of P2P lending process I saw comes from the SEC proceedings. They are very careful about naming things that are happening in the process. Prosper got back to business after this order, but the paper describes succinctly how Prosper worked when its notes haven't yet been registered by the SEC. These materials contain a lot of responsible comments on how crowdfunding, including P2P lending, works." } ]

[ { "docid": "180690", "title": "", "text": "I have my own top 10 list, coming straight from the management of Semco. 1 - Values I write a lot on this blog about the importance of values, and I feel there is no exception here. Ricardo fundamentally believes in human equality and the importance of each individual, otherwise there is no way he could commit to such a mission. These values originated from him, but they've now permeated throughout the organization and every individual believes in them. 2 - Consistency This is an extension of values, because when your values are solid and clear, your behaviors and actions will flow from that. There are no contradictory policies that would confuse employees. Everyone is equal and all aspects of the organization from salary, profit sharing, job titles, power, working hours, leadership, and vacations reflect that. 3 - Peer Pressure There is nothing more effective for keeping order than peer pressure. All the rules in the world can’t replace the power of your friends and colleagues holding you accountable. It’s much more meaningful than a top down approach. The pressure is real, it has teeth since peers can come together and fire employees that aren’t doing their job. 4 - Profit Sharing Touchy feely open management is nothing without something real to back it up, and 23% pre-tax profit sharing is as real as it gets. Everyone is motivated because they know they will get rewarded for their hard work, and it also ensures that peer pressure is working well. They also get creative with this, giving employees the option of deferring 25% of their salary until the end of the year, at which time they might get a bonus resulting in a 150% of their original salary depending on the business unit’s performance. 5 - Empowerment Giving people freedom and responsibility without the tools to get things done is a recipe for disaster. All opinions are heard and there is value in the work of every employee.Nobody has an excuse for why they can’t get things done. 6 - Small Business Units Each business unit is small enough so that everyone involved understands everything that is going on and the outcomes.No way people can self organize if a unit is hundreds of people large.The magic number for the maximum effective size for a group is 150 and Semco will not allow a business unit to go beyond that. 7 - Total Transparency Semco goes to great lengths to ensure everyone knows how their financials are, even to the extent of displaying them in an easy to understand cartoon. There are no secrets, and this demonstrates trust and respect. 8 - No Symbols of Inequality There are no offices with huge windows, reserved parking spaces or other symbols that clearly show differences between employees.Everyone plays by the same rules, and everyone feels valued. 9 - Purpose Purpose is the cheapest way to align an organization. When everybody feels their works is valuable, they know why they are doing it and take pride in it, things naturally align themselves. Everyone feels like they are part of something important. 10 - Long Term Thinking/Private Company Can you change corporate culture in a few days, months, even years?Likely not, particularly if it is deeply ingrained. Also, how quickly do managers resort to short term solutions such as layoffs, budget cuts or other forms of control to try and reduce expenses the moment things go badly? Even under deep pressure, the company must stay the course and believe in the value of the open system. You can bend but you can’t break and revert to old school management. With private companies this is probably a lot easier than with public companies that are measured on quarterly performance. full post here: http://orgeffectiveness.ca/post/33166914205/the-most-radical-workplace-in-the-world-and-10-reasons" }, { "docid": "146643", "title": "", "text": "For questions 1 and 2. 1) If you are packing the loans into a CDO, they are being sold on the open market. Once it achieves a AAA rating, as most did even though they were mostly subprime, alt a, or arm, it is sold and shipped off the originator's books (While the originator of the CDO collects X% in fees) Basically how the originator makes their money is by X amount of CDOs they sell. There was no incentive to pick and choose the best borrowers to sell a loan to because how the CDOs were sold they achieved the best rating regardless of the borrowers credit risk. Due to this model, people are going to try and get as many people into the homes and sell the CDO asap. This caused questionable lending practices to result, NINJA (no income, no job, no assets) loans, manipulating borrowers income, assets, etc. Things that could be changed to help not have this occur again: a) Feds monetary policy was pretty meh during this period, due to low interest rates the banks had pretty much an endless supply of money and when all the reasonable ventures dried up they had to explore other opportunities to lend. b) Ratings agencies need an overhaul in how they receive their commission, preferably they should be being paid by the investor not the person issuing the security. This will help to eliminate the bias that results. c) Having X% (2-5) remain on the institutions books who created the CDO will help to make them responsibly lend. This is because if they are required to have it remain on their books, they will make better longer term decisions in who to lend to. I'm pretty sure all of these issues are discussed in Nouriel Roubini's book [Crisis Economics](http://www.amazon.com/Crisis-Economics-Course-Future-Finance/dp/1594202508) Another Great book already mentioned in this thread is by Michael Lewis [The Big Short](http://www.amazon.com/Big-Short-Inside-Doomsday-Machine/dp/0393338827/ref=sr_1_1?s=books&amp;ie=UTF8&amp;qid=1324140607&amp;sr=1-1) If your interested in the European Crisis Michael Lewis also just came out with [Boomerang](http://www.amazon.com/Boomerang-Travels-New-Third-World/dp/0393081818/ref=sr_1_1?s=books&amp;ie=UTF8&amp;qid=1324140665&amp;sr=1-1)" }, { "docid": "446464", "title": "", "text": "&gt; Allowing taxi licencing to become so expensive, than it places that level of debt on the owner is sheer madness - a recipe for a bubble. Yeah. We're basically artificially sustaining a lending business because we've created the necessity to lend for something that shouldn't be expensive in the first place. I think it's natural that in trying to clean up the bloat in the economy, there will undoubtedly be winners and losers." }, { "docid": "490584", "title": "", "text": "There are multiple factors at play that drive stock price movements, but one that can be visualized is that stocks can be priced relative to other (similar stocks). When one stock price goes up without fundamental changes (i.e. daily market noise/movements), it becomes slightly more expensive relative to it's peers. Opportunists will sell the now slightly more expensive stock, while others may buying the slightly cheaper (relatively) peer stock. Imagine millions of transactions like this happening throughout each hour, downward selling pressure on a stock that rises too fast in value relative to it's peers or the market, and upward buying pressure on stocks that are relatively cheaper than it's peers. It pushes two stocks towards an equilibrium that is directionally the same. Another way to think of it is lets say tomorrow there is $10B in net new dollars moved into buy orders for stocks that comes from net selling of bonds (this is also partly why bonds/stocks are generally inversely related). That money goes to buys stocks ABC, XYZ, EFG. As the price of those goes up with more buying pressure, stocks JKL, MNO, PQR are relatively a tad cheaper, so some money starts to flow into there. Repeat until you get a large majority of the stocks that buyers are willing to buy and you can see why stocks move in the same direction a lot of times." }, { "docid": "515156", "title": "", "text": "There are peer to peer services these days which work by trying to match someone who wants to convert currency X to currency Y with other people who want to convert Y to X. Obviously this works better with major currencies. They tend to give you the midmarket interbank rate banks use to trade with each less their commission of 1-2%. Banks can charge up to 5% and use different rates for buying and selling. Transfers may take a day or two, although you may be able to do it faster if you pay extra. Transferwise, CurrencyFair and MidPoint are examples of such services though there are many others. Here's a link to a newspaper article with more details." }, { "docid": "172590", "title": "", "text": "You could look up their old SEC filings before they were placed in conservatorship. Derive WACC from that. Comp to peer financials from the same timeframe; see how they compare. Assume some sort of size premium if you so desire. That might give you a picture of the business's cost of capital were it an independent entity. Since it's a GSE, you could make the case that its cost of capital is the rate on US treasury securities. In reality, it's current cost of capital is probably a mix of the two." }, { "docid": "557685", "title": "", "text": "A fair number of micro-finance organisations have been listing recently and appear to be offering good yields. So you could simply buy their stock rather than investing directly. SKS is an Indian micro-financier that went public just a few weeks ago. The interest rates charged can be extremely high to match the low yield per lender. As has been mentioned, Kiva doesn't return interest to the lender. However, Kiva doesn't lend directly either. They on-lend to local microfinanciers who will lend at whatever interest rate the local market will bear. The range of interest rates applied to micro-credit loans can be chilling. 45% to 85% in Africa, 30% in India and a jaw-dropping 155% in Mexico. However, these high rates of return have attracted an absolute stampede of investors. In Mexico more than 300 micro-credit banks compete for business. Chuck Waterfield, the founder of MicroFinance Transparency, is concerned that there is an unsupportable bubble. Lenders are starting to take out more loans than they can afford and banks are doing little to curb that appetite for debt. Sound familiar? So, you may not want to lend directly, but definitely consider looking at listed microfinanciers in places like Brazil and India. As usual, though, study the company carefully." }, { "docid": "162892", "title": "", "text": "\"I experimented with Lending Club, lending a small amount of money in early 2008. (Nice timing right - the recession was December 2007 to June 2009.) I have a few loans still outstanding, but most have prepaid or defaulted by now. I did not reinvest as payments came in. Based on my experience, one \"\"catch\"\" is lack of liquidity. It's like buying individual bonds rather than a mutual fund. Your money is NOT just tied up for the 3-year loan term, because to get good returns you have to keep reinvesting as people pay off their loans. So you always have some just-reinvested money with the full 3 year term left, and that's how long it would take to get all your money back out. You can't just cash out when you feel like it. They have a trading platform (which I did not try out) if you want your money sooner, but I would guess the spreads are wide and you have to take a hit when you sell loans. Again though I did not try the trading platform. On the upside, the yields did seem fine. I got 19 eventual defaults from 81 loans, but many of the borrowers made a number of payments before defaulting so only part of the money was lost. The lower credit ratings default more often obviously, only one of 19 defaults had the top credit score. (I tried investing across a range of credit ratings.) The interest rates appear to cover the risk of default, at least on average. You can of course have varying luck. I made only a slight profit over the 3 years, but I did not reinvest after the first couple months, and it was during a recession. So the claimed yields look plausible to me if you reinvest. They do get people's credit scores, report nonpayment on people's credit reports, and even send people to collections. Seems like borrowers have a reason to pay the bill. In 2008 I think this was a difference compared to the other peer lending sites, but I don't know if that's still true. Anyway, for what it's worth the site seemed to work fine and \"\"as advertised\"\" for me. I probably will not invest more money there for a couple reasons: However as best I could tell from my experiment, it is a perfectly reasonable place to put a portion of your portfolio you might otherwise invest in something like high-yield bonds or some other sub-investment-grade fixed income. Update: here's a useful NY Times article: http://www.nytimes.com/2011/02/05/your-money/05money.html\"" }, { "docid": "546122", "title": "", "text": "\"This is the best tl;dr I could make, [original](https://wol.iza.org/articles/do-social-interactions-in-workplace-lead-to-productivity-spillover-among-co-workers) reduced by 70%. (I'm a bot) ***** &gt; Should one expect a worker&amp;#039;s productivity, and thus wage, to depend on the productivity of his/her co-workers in the same workplace, even if the workers carry out completely independent tasks and do not engage in team work? This may well be the case because social interaction among co-workers can lead to productivity spillover through knowledge spillover or peer pressure. &gt; The available empirical evidence suggests that, due to such peer effects, co-worker productivity positively affects a worker&amp;#039;s own productivity and wage, particularly in lower-skilled occupations. &gt; Evidence suggests that peer pressure affects productivity and is an important reason why workers&amp;#039; wages and productivity depend on their co-workers&amp;#039; productivity. ***** [**Extended Summary**](http://np.reddit.com/r/autotldr/comments/77o9hf/do_social_interactions_in_the_workplace_lead_to/) | [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ \"\"Version 1.65, ~231949 tl;drs so far.\"\") | [Feedback](http://np.reddit.com/message/compose?to=%23autotldr \"\"PM's and comments are monitored, constructive feedback is welcome.\"\") | *Top* *keywords*: **productivity**^#1 **work**^#2 **peer**^#3 **spillover**^#4 **co-worker**^#5\"" }, { "docid": "134995", "title": "", "text": "Financial modeling training - if you ever have any interest in private equity, investment banking, leveraged lending, equity analysis, corporate finance roles, FP&amp;A, or commercial banking in general, you will need to confidently work with three statement financial models. There's lots of good resources out there. Some cost more than others." }, { "docid": "282483", "title": "", "text": "In general, investors with a long period of time until they would need to withdraw the cash are best off holding mostly equities. While the dividends that equities would return are less than the interest you would get in peer-to-peer lending, over long periods of time not only do you get the dividends from equity investment but the value of the stock will grow faster than interest on loans. The higher returns from stocks, however, comes with more risk of big downturns. Many people pull their investments out of stocks right after crashes which really hurts their long term returns. So, in order to get the benefit of investing in stocks you need to be strong enough to continue to hold the stocks through the crash and into the recovery. As for which stocks to invest in, generally it is best to invest in low-fee index funds/etfs where you own a broad collection of stocks so that if (when) any one stock goes bust that your portfolio does not take much damage. Try to own both international and domestic stocks to get good diversification. The consensus recommends adding just a little bit of REITs and bonds to your investments, but for someone at 25 it might not be worth it yet. Warren Buffett had some good thoughts on index investing." }, { "docid": "155245", "title": "", "text": "\"I agree with you, but both are bad. What happens with fractional reserve banking is inflation, but this inflation isn't distributed evenly across all the markets, those who the banks lend to are who see the inflation first I.e. the Dow. But nobody gets a loan to buy commodities, so these lag in the inflation. When a recession hits the banks slow their loaning while the commodities play catch-up. During this period it makes more sense to \"\"invest\"\" in commodities than in the majority of businesses. So in an effort to make capital \"\"available\"\" you've created an entire community of investors investing in an unproductive sector for just as long as you had them hyper-investing in productive sectors. Net zero gain, with a decade of time lost. I wont ever believe we need frac reserve lending to have a bank, especially when the bank collapses the currency every 30-50 years. If someone's to loan money they should do it with their own money, with approval, or somehow prevent 2-3-10 people from racing to the same reserve.\"" }, { "docid": "560292", "title": "", "text": "Honestly, why not? If my goal is to end up in finance, then I need to understand, from people in that field, whether a certain subject is relevant for me to achieve that goal. If I were to ask that question to those majoring/working in physics, then I am going to get a completely different outlook that's not beneficial for me. What you don't realize is that when you are asking your peers in school, many of them give you half answers or even bogus ones. It makes perfect sense to ask the question in a forum. As a matter of fact, the answers that I am getting here are completely different from what I was originally told by my peers." }, { "docid": "90504", "title": "", "text": "\"**The paper’s findings are preliminary and have not yet been subjected to peer review.** &gt;\"\"The paper’s findings are preliminary and have not yet been subjected to peer review. And the authors stressed that even if their results hold up, their research leaves important questions unanswered, particularly about how the minimum wage has affected individual workers and businesses. The paper does not, for example, address whether displaced workers might have found jobs in other cities or with companies such as Uber that are not included in their data.\"\"\"" }, { "docid": "198895", "title": "", "text": "OCTOBER 18, 2017 by John Gapper Goldman Sachs making too little money is not the worst of the world’s problems. But inside the investment bank’s New York headquarters, it feels like an insult. Goldman is not suffering a financial crisis, as it did in 2008 when it officially converted to being a bank holding company amid panic that the whole of Wall Street could collapse. It faces something deeper: an identity crisis. It used to be the role model for many rival banks — envied even while resented for its single-minded focus on investment banking and trading. But as Tuesday’s disclosure of a 26 per cent fall in its bond trading revenues confirmed, banking has changed. Instead of lenders such as JPMorgan Chase wanting to become as glamorous as Goldman, it needs to be more like them. This is a telling moment, albeit less dramatic than 2008. Investment banking enjoyed a lucrative two decades, spurred by globalisation and financial liberalisation. Goldman’s revenues rose briskly from its initial public offering in 1999 to 2007, and boomed in 2009. It could do no wrong financially, although it turned out to have done wrong to some of its customers. But guess what? Regulation works. Governments and central bank supervisors set out to make complex trading in bonds and derivatives, the securities business in which Goldman specialised, more expensive and less profitable. The rules now favour deposit taking and lending instead of wizardry. No one really planned the second aspect of the bank’s difficulty. The huge dose of monetary easing since the crisis has damped volatility and made markets more predictable. Hedge funds, themselves under pressure, no longer need to reward Goldman and others for taking on financial risk. Goldman’s bond and commodities trading division — from which emerged a cadre of leaders including Lloyd Blankfein, its chairman and chief executive — tells its own story. It used to occupy two floors of the New York office but has shrunk to one as Wall Street’s total bond trading revenues have halved since 2009. More prices are calculated by computers than humans. When you rely heavily on one engine and that engine sputters, you are in trouble. The bank’s financial advisory and capital raising division is performing well and it has an investment management arm. But it lacks a consumer powerhouse like Morgan Stanley’s wealth management operation, or the lending and credit card activities that drive banks such as JPMorgan. The humbling truth for Goldman is that US retail banking has become not only more reliable than investment banking, but more profitable. JPMorgan’s balance sheet is three times the size of Goldman’s and its retail banking arm made a 19 per cent return on equity in the third quarter, compared with Goldman’s 11 per cent. The best historical comparison for Goldman’s predicament is, ironically, the JPMorgan of the 1990s. JPMorgan was a blue-chip corporate bank but found that this business was no longer profitable enough as lending margins fell. It launched an effort to return to investment banking, having been separated from Morgan Stanley in 1935 by the Glass-Steagall Act. JPMorgan had a good stab at it, compensating for the fact that Goldman and others dominated Wall Street’s “bulge bracket” by pioneering credit derivatives (which later turned out badly). But it could not make enough progress alone and settled for being bought by Chase Manhattan in 2000. “Both [banks] have struggled to keep pace with the rapid growth of the leading investment banks, which are in businesses that have been far more lucrative than the lending business at the core of commercial banking,” the New York Times noted in its account of the merger. Seventeen years and one financial crisis later, JPMorgan has reversed this order of profitability. So Goldman is now trying to do the opposite of the old JPMorgan by adding banking to investment banking. JPMorgan’s former dilemma has not gone away — lending to blue-chip companies is not much of a moneymaker. A more tempting target is the high margins that banks make on credit cards. Hence Marcus, Goldman’s online lender (named after its founder Marcus Goldman), which offers loans to prime US consumers as an alternative to credit card debt. Marcus, which will launch next year in the UK, accounts for $12bn of the $28bn in new lending and financing planned by Goldman in the next three years as it diversifies. But it is no simpler for Goldman to break into Main Street than it was for the old JPMorgan to break back into Wall Street: $12bn on a balance sheet of $930bn is an interesting financial experiment, not a revolution. It would need to inflict on consumer banking with technology what Amazon did to the retail industry to rival fully JPMorgan and Bank of America. “We’re a bank and we’re committed to being a bank,” says one partner firmly. But selling personal loans and mortgages, which could be Marcus’s next target, is not a job designed for masters of the universe. This is Goldman’s identity crisis: regulation and economics are rendering it ordinary." }, { "docid": "406434", "title": "", "text": "To round out something that @Chris W. Rea pointed out, the business that a REIT is in will be either A) Equity REIT... property management, B) mortgage REIT... lending, or C) hybrid REIT (both). A very key point about why REITs broadly have been struggling lately, (and this would show up in the REIT indices/ETFs you've linked to,) is linked to the REIT business models. For an Equity REIT, they borrow money at the going rate (let's say ~4.5% for commercial-scale loans), and use that to take out mortgages on physical properties. If a property rents for $15K per month, and they can take out a $1.8 million loan at $9,000 per month, then their business is around managing maintenance, operating expenses, and taxes on that $6,000 per month margin. For a mortgage REIT, they borrow funds as a highly qualified borrower, (again let's say ~4.5%), and lend those funds back out at a higher rate. The basic concept is that if you borrow $10 million at 4.5% for 30 years, you need to pay it back at $50,668 per month. If you can lend it out reliably at 5%, you collect $53,682 per month... a handy $3,000 per month. The cheaper you can get money at (below 4.5%) and the higher you can lend it at (above 5%), the better your margin is. The worry is that both REIT business models are very highly dependent on the cost of borrowing money. With the US Fed changing its bond-buying/QE/stimulus activity, the prevailing interest rates are likely to go up. While this has its benefits (inflation), it also will make it more expensive for these types of companies to do business." }, { "docid": "329662", "title": "", "text": "\"As the other answer said, the person who owns the lent stock does not benefit directly. They may benefit indirectly in that brokers can use the short lending profits to reduce their fees or in that they have the option to short other stocks at the same terms. Follow-up question: what prevents the broker lending the shares for a very short time (less than a day), pocketing the interest and returning the lenders their shares without much change in share price (because borrowing period was very short). What prevents them from doing that many times a day ? Lack of market. Short selling for short periods of time isn't so common as to allow for \"\"many\"\" times a day. Some day traders may do it occasionally, but I don't know that it would be a reliable business model to supply them. If there are enough people interested in shorting the stock, they will probably want to hold onto it long enough for the anticipated movement to happen. There are transaction costs here. Both fees for trading at all and the extra charges for short sale borrowing and interest. Most stocks do not move down by large enough amounts \"\"many\"\" times a day. Their fluctuations are smaller. If the stock doesn't move enough to cover the transaction fees, then that seller lost money overall. Over time, sellers like that will stop trading, as they will lose all their money. All that said, there are no legal blocks to loaning the stock out many times, just practical ones. If a stock was varying wildly for some bizarre reason, it could happen.\"" }, { "docid": "587711", "title": "", "text": "I've been using xetrade for quite awhile, also used nzforex (associated with ozforex / canadian forex, probably ukforex as well) -- xetrade has slightly better rates than I've gotten at nzforex, so I've been using them primarily. That said, I am in the process of opening an account at CurrencyFair, because it appears that I'll be able to exchange money at better rates there. (XETrade charges me 1.5% off the rate you see at xe.com -- which is the FX conversion fee I believe -- there are no fees other than the spread charged). I think the reason CurrencyFair may be able to do better is because the exchange is based on the peer-to-peer trade, so you could theoretically get a deal better than xe.com. I'll update my answer here after I've been using CurrencyFair for awhile, and let you know. They theoretically guarantee no worse than 0.5% though (+ $4.00 / withdrawal) -- so I think it'll save me quite a bit of money." }, { "docid": "268747", "title": "", "text": "Use one journal entry, and split the expenses into the appropriate accounts. This can happen even if you never mix business and personal on the same receipt: say you order office supplies (which where I live are immediately deductible as an expense) and software or hardware (which must be depreciated because they are assets) on the same order. We have an account called Proprietors Loan which represents money the company is lending to the humans who own it, or that the humans are lending to the company. Were I to pay for my personal lunch on a business credit card, it would go through that account, increasing the amount the company has lent me or decreasing the amount I have lent it. Similarly if I made a business purchase with a personal card it would go through that account in the other direction. Where I live, I can lend my company all the money I want any time, but if the company lends me money there can't be an outstanding balance over the corporate year end. If you make two credit card entries of 5 and 10 when you go to reconcile your accounts it will be harder because you'll have to realize they together match the single 15 line on your statement. Making a single entry (your A option) will make reconciling your statement much easier. And that way, you'll probably reconcile your statements, which is vital to knowing you actually recorded everything." } ]

[ { "docid": "474248", "title": "", "text": "The Federal Reserve website notes that creditors must accept cash for debts on services already rendered, but that businesses may refuse cash for services not yet rendered unless prohibited by local law. The Treasury website includes examples of businesses limiting what cash they will accept: For example, a bus line may prohibit payment of fares in pennies or dollar bills. In addition, movie theaters, convenience stores and gas stations may refuse to accept large denomination currency (usually notes above $20) as a matter of policy." } ]

[ { "docid": "248697", "title": "", "text": "Maybe there's more to this story, because as written, your sister seems, well, a little irrational. Is it possible that the bank will try to cheat you and demand that you pay a loan again that you've already paid off? Or maybe not deliberately cheat you, but make a mistake and lose track of the fact that you paid? Sure, it's POSSIBLE. But if you're going to agonize about that, what about all the other possible ways that someone could cheat you? What if you go to a store, hand over your cash for the purchase, and then the clerk insists that you never gave him any cash? What if you buy a car and it turns out to be stolen? What if you buy insurance and when you have a claim the insurance company refuses to pay? What if someone you've never met or even heard of before suddenly claims that you are the father of her baby and demands child support? Etc etc. Realistically, banks are fanatical about record-keeping. Their business is pretty much all about record-keeping. Mistakes like this are very rare. And a big business like a bank is unlikely to blatantly cheat you. They can and do make millions of dollars legally. Why should they break the law and risk paying huge fines and going to prison for a few hundred dollars? They may give you a lousy deal, like charge you outrageous overdraft fees and pay piddling interest on your deposit, but they're not going to lie about how much you owe. They just don't. I suggest that you not live your life in fear of all the might-be's. Take reasonable steps to protect yourself and get on with it. Read contracts before you sign, even if the other person gets impatient while you sit there reading. ESPECIALLY if the other person insists that you sign without reading. When you pay off a loan, you should get a piece of paper from the bank saying the loan has been paid. Stuff this piece of paper in a filing cabinet and keep it for years and years. Get a copy of your credit report periodically and make sure that there are no errors on it, like incorrect loan balances. I check mine once every year or two. Some people advise checking it every couple of months. It all depends how nervous you are and how much time you want to spend on it. Then get on with your life. Has your sister had some bad experience with loans in the past? Or has she never borrowed money and she's just confused about how it works? That's why I wonder if there's more to the story, if there's some basis for her fears." }, { "docid": "365648", "title": "", "text": "\"In addition to Alex B's excellent overview, I'd like to add a few more bits of advice. First of all, one term you should know is \"\"commercial real estate\"\" - which is precisely what this is. There is a business element, but it is strictly (and almost entirely) intertwined to the underlying real estate, which makes this a special category of business which is generally considered simply \"\"commercial real estate\"\" (just like office buildings, shopping malls, etc). All real estate and businesses value are based on alternatives - what other options are there? In appraisal, these are generally called \"\"comparables\"\". A professional appraiser is generally available for commercial real estate of this type. While a full, official commercial appraisal can run into the thousands, many/most (all?) appraisers are willing to sell you a simplified version of their service, which can be called a \"\"letter of opinion\"\" and can help you get an idea for the market price (what other similar commercial properties are running for). A loan company would strictly require this, but if you are thinking of an all cash or form of seller-financing this would technically be optional. Your best bet is to read about some of what is involved in commercial real estate appraisal and evaluation, and you may even want to speak with commercial loan officers - even if you don't know that you want to get a loan to acquire the property! It's their job to help inform you about what is required and what they look for, so they can be a potential resource beyond your own research as well. With this said, the only way to estimate value (and, conveniently, the best way) is to look at other properties! And by \"\"others\"\", I mean that you should really not consider buying absolutely anything until you've viewed at least 6-10 other options in some depth - and you probably want to double or triple that number if you are looking to make this the last big business transaction of your life. If you don't you'll be relying on little more than dumb luck to carry you through - which in this area of business, you don't want to do because the dollar amounts and liabilities involved can bankrupt you in no time flat. With that general advice out of the way, here's a tiny nutshell version of valuation of commercial real estate. There are a few key parts involved in commercial real estate: land, improvements (buildings, docks, stuff like that), income, and wages. Land: the value of the land is based upon what you could sell it for, as-is. That is to say - who else might want it? This alone has many important factors, such as zoning laws, the neighborhood (including your neighbors), water/utilities, pacts on the land (someone may have insisted the land not be paved into a parking lot, or really anything like that), alternative uses (could you put a golf course on it, or is the land suitable for a big building or farming?), etc. And is this in a growing area, where you might hope the value will increase over the next decade, or decrease, or basically stay flat (and possibly cause losses compared to inflation)? Improvements: anything on the land is both an asset and a liability. It's an asset because it could add to the value of the land, but it might also reduce the land value if it interferes with alternate land uses. It's a liability, both in the legal sense and in that it requires maintenance. If you want to rent them out, especially, that means concern about any foundations involved, termites, roofs, sewage/septic tanks, utilities that are your responsibility (pipes, poles, wires), as well as any sort of ac/heating you may have, docks, and so on. These things are rarely free and absolutely can eat you alive. Income: Ah, the best part, the constant influx of cash! But wait, is it a constant influx? Some businesses are purely seasonal (summer only, winter only), some are year-round but have peak times, and others don't really have a \"\"peak\"\" to speak of. If you are renting, are there issues collecting, or with people over-staying? How about damage, making a mess, getting rowdy and disturbing others? Regardless, there is obviously some income, and this is usually the most dangerous part of the equation. I say \"\"dangerous\"\", because people absolutely lie like dogs on this part, all the time. It's easy to cook the books, assuming they even attempt to keep proper books in the first place! Businesses of this form often have a lot of cash business that's easy to hide (from Uncle Sam, or sometimes even the owners themselves if there are employees involved) - and fake! And some people are just shoddy bookkeepers and the info is just wrong. But, there will clearly be some kind of yearly income involved. What does this matter? Well...how much is there? How much is tied to the owners (personal friends do business and they will leave if the ownership/management changes)? In commercial real estate the income will be calculated for a fiscal year, and then there is something called a \"\"multiple\"\", which is market dependent. Let's say the whole place takes in $100k in rent a year. As part of buying this business, you are buying not just assets, but expected future income. In some commercial areas the multiple is as little as .5 to 2 - which means that the going rate is about 6-24 months worth of income, as part of the purchase price. So with 100k rent a year, that means 50k-200k of the purchase price is attributable to the income of the business. And if business is half of what you thought it would be? That means the net value of the whole enterprise decreases by 25k-100k - on top of the reduced income every year you own it! Income provides cash flow, which should pay all the expenses (cleaning up from wind storms, replacing windows that are broken, hauling off trash, replacing a well that ran dry), and then the extra that remains is positive cash flow. If you take out a loan, then ideally the cash flow would also pay that completely so long as you don't have any big unexpected expenses in the year - and still have some left over for yourself. Wages: Well, that money doesn't collect itself! There's sales, keeping the books, collecting the rent, performing maintenance, customer service, cleaning, paying the bills, keeping the insurance people happy, handling emergencies, and everything else involved with running the business. Someone is going to do it, and the biggest error people make here is not to put any value on their time - and to make it so they can never afford to take a vacation again! Pay yourself, and give yourself the flexibility to pay others when you can't (or don't want) to do it all yourselves. So, what's the point of all this? How do you actually make any money? In two ways: 1) selling the whole thing later, and 2) cash flow. For 1, it's important that you not be in a situation where you are betting that in the future there will be a \"\"person richer, and dumber, than I am now\"\". If the current owner wanted 2 million, then 1 mil, then less, over multiple years...this suggests either he is delusional about the value of his place (and most property owners are), or that its actually hard to find a buyer for such a business. You are going to want to make sure you understand why that is, because most of the value of real estate is...well, in the real estate itself! For 2, you need cash coming in that's considerably more than the cost of running the place. Also, cash flow can strongly change the value of the business for resale (depending on the multiple, this can make a huge difference or prevent you from selling the thing at all). You mentioned you want to put in more cabins, more marketing/sales efforts, etc. That's great, but first, that would mean added investment beyond the purchase price. Is it legally and physically practical to add more cabins, and what is their current utilization rate? If they are only renting 10% of their current capacity, increasing capacity may be premature. This will also vary through the year, so you may find there is a problem with being sold out sometimes...but only for a small percentage of the time. Which means you'll be adding buildings only to have them used for a fraction of the year, which will be very hard to make a profit from. If cash flow is good, ideally even being enough to cover a loan payment to help cover the purchase price (and remember that commercial real estate loans are much smaller loan-to-value ratios than in residential real estate), there is one final barrier to making money: the damn non-regular maintenance! Roofs, wells, and wooden walls all have a sad tendency to cost you nothing right up until the point they cost you $30k+ on a single day. Is there enough cash flow to make these sort of certainties (and if you plan to be there for years, they are a certainty) not put you in the poor house? This was rather long, but I hope this overview helps you appreciate all that you'll need to look into and be cautious of during your future en-devour! Commercial real estate is generally costly and high-risk, but also can be high reward. You'll need to compare many opportunities before you can get a \"\"feel\"\" for what is a good deal and what is a terrible one. You'll need to consider many factors, such as resale value and cash flow/income (which they will have to tell you and you can assume is not true, due to ignorance or malice), as well as maintenance and liabilities, before you can begin to really estimate the value of an enterprise of this sort. There are people who can help you, like appraisers and commercial brokers, but ultimately you'll need to do a lot of research and comparisons yourself to help you make a good decision. Finally, there is no very simple method for evaluating commercial real estate value. You need a variety of information, and you must be skeptical of what you are told because of the very large sums of money involved. It is doable (lots of people do it), but you must take care and do your due diligence so you don't get bankrupted by a single bad purchase.\"" }, { "docid": "357280", "title": "", "text": "I've been an F&I Manager at a new car dealership for over ten years, and I can tell you this with absolute certainty, your deal is final. There is no legal obligation for you whatsoever. I see this post is a few weeks old so I am sure by now you already know this to be true, but for future reference in case someone in a similar situation comes across this thread, they too will know. This is a completely different situation to the ones referenced earlier in the comments on being called by the dealer to return the vehicle due to the bank not buying the loan. That only pertains to customers who finance, the dealer is protected there because on isolated occasions, which the dealer hates as much as the customer, trust me, you are approved on contingency that the financing bank will approve your loan. That is an educated guess the finance manager makes based on credit history and past experience with the bank, which he is usually correct on. However there are times, especially late afternoon on Fridays when banks are preparing to close for the weekend the loan officer may not be able to approve you before closing time, in which case the dealer allows you to take the vehicle home until business is back up and running the following Monday. He does this mostly to give you sense of ownership, so you don't go down the street to the next dealership and go home in one of their vehicles. However, there are those few instances for whatever reason the bank decides your credit just isn't strong enough for the rate agreed upon, so the dealer will try everything he can to either change to a different lender, or sell the loan at a higher rate which he has to get you to agree upon. If neither of those two things work, he will request that you return the car. Between the time you sign and the moment a lender agrees to purchase your contract the dealer is the lien holder, and has legal rights to repossession, in all 50 states. Not to mention you will sign a contingency contract before leaving that states you are not yet the owner of the car, probably not in so many simple words though, but it will certainly be in there before they let you take a car before the finalizing contract is signed. Now as far as the situation of the OP, you purchased your car for cash, all documents signed, the car is yours, plain and simple. It doesn't matter what state you are in, if he's cashed the check, whatever. The buyer and seller both signed all documents stating a free and clear transaction. Your business is done in the eyes of the law. Most likely the salesman or finance manager who signed paperwork with you, noticed the error and was hoping to recoup the losses from a young novice buyer. Regardless of the situation, it is extremely unprofessional, and clearly shows that this person is very inexperienced and reflects poorly on management as well for not doing a better job of training their employees. When I started out, I found myself in somewhat similar situations, both times I offered to pay the difference of my mistake, or deduct it from my part of the sale. The General Manager didn't take me up on my offer. He just told me we all make mistakes and to just learn from it. Had I been so unprofessional to call the customer and try to renegotiate terms, I would have without a doubt been fired on the spot." }, { "docid": "484352", "title": "", "text": "\"11 / 111 / 11111 looks like the (old) tax number: it is used by the tax office to know who you are, it isn't good at all for the spanish company. It would even change when you move inside Germany. VAT IDs are not exclusive to GmbHs (but a GmbH always has one). As freelancers you can get at VAT ID but you don't always have to. The tax office offers a \"\"small business\"\" treatment (§ 19 UStG) for freelancers, kind of an opt-out for the VAT ID. As you do not have a VAT ID, this is probably your case. It means So what to do? If I were you, I'd write them that according to §19 UStG and the European Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, TITLE XII CHAPTER 1 \"\"Special scheme for small enterprises\"\" you were not assigned a VAT ID, and VAT is not applicable to your bill. The fact that VAT is not applicable in this case does not mean that they are allowed to refuse payment. I heard a rumour (but don't really know) that a number similar to the VAT ID is planned also for freelancers (Wirtschafts-IDNr.). You could go to your tax office and ask them about. Maybe that yields a number that satisfies spanish burocracy. AFAIK, you can go to your tax office and ask them to give you a real VAT number. But careful: that has the serious drawback that you have to do do an advance VAT estimate and pay that to the tax office at least quarterly (for bigger business monthly). And (AFAIK) you are not allowed to change back to the small business treatment for several years.\"" }, { "docid": "125422", "title": "", "text": "If this is because he wants to avoid paying taxes, will I get in trouble if I agree to have him work on my vehicle? You should check your state and local sales tax laws to be certain, but in my state you have no liability if he does not pay his taxes. That's his problem, not yours. The biggest risk for you is if something goes wrong, you have no proof that the work was ever done, so it's possible he could deny that any transaction ever took place and refuse to correct it or refund your money. So at worst you're out what you paid for the service, plus what it would cost you to fix it if you needed to and chose to do so. If you don't want to take that risk, then insist on a receipt or take you business elsewhere, but there's no criminal liability for you if he chooses not to report the income. EDIT Be aware, though that state tax is levied at the state and local level, so the laws of your individual state or city may be different." }, { "docid": "76120", "title": "", "text": "Well first problem is usually that you are trying to do too much, you end up micro managing, once a company becomes large enough this is impossible to keep doing at the same level. If you find that you don't have enough time maybe it's time to either hire someone new, or promote/transfer someone. You need to trust and give freedom to your employees to do their job in their own way which may or may not be better than yours. (Communicate with each at intervals.) A lot of business owners struggle with this because it costs them money, and that is wrong it's cost your company money which is a separate entity than you. A piece of property that makes you less money than the week before is still making you money you are not losing money. So get that out of your head, it's not your money until you take it out of the business until then that money including profits are the property of the business (this is how the law see it by the way.) Marginally an understaffed store will make a larger percentage of profits from revenue, a well staffed store will make more actual profits from more actual revenue because it can handle the business coming into the store better, which in turns should lead to more business. On a particular day you may see more money in profit from an understaffed store, someone calls out let's say, but trust me when I say that will not continue for very long. On of the biggest challenges new business owners face is they are fugal, as in they don't spend the money they need to. This means buying new equipment, and hiring and giving raises and promotions, so you can handle new business as well. Let say you are making T-Shirts, or really adding new designs to pre-made plain shirts, you can only press one at a time which for a while is enough, but eventually you are going to need another press so you can do 2 at a time, but a lot business owners will somehow expect an employee to produce more with what he has, now orders aren't being filed and you are in a panic and possibly angry but guess what you are angry at the employee not the fact you were to stupid to realize that he needs 2 presses to do the job correctly that's your own fault and you're blind to it, because you feel as if you are working twice as hard than them because of the problem you created! And let's say the problem is different now the press isn't getting hot enough and it take 20% per shirt to get it to stay on correctly and you decide to never fix it, then a light goes out then blank then blank and suddenly you realize finally all of this needs to be replaced at the same time. I've seen things like this happen, in new and old businesses things work fine for the first 5 years then normal maintenance is forgotten, have a depreciation fund ready so it doesn't feel like you are spending any money, that's what that fund is for and you put into it from the beginning, need a $2k equipment, ohh I have $4k saved for this already, it was money intended to be spent on this. But of course some of this is going to depend on the type of business you are running! And since you have provided us no details I can't give an answer for you because all businesses are different, but I feel that these things, refusing to give freedom and authority to other employees, and refusing to spend money when needed are the biggest pitfalls most business owners fall into." }, { "docid": "505461", "title": "", "text": "\"You state \"\"Any info will be appreciated\"\", so here's some background information on my answer (you can skip to my answer): When I worked for banks, I was required to submit suspicious activity to the people above me by filling out a form with a customer's name, SSN, account number(s) and ID. You may hear in media that it is $10K or sometimes $5K. The truth is that it could be lower than that, depending on what the institution defines as suspicious. Every year we were required to take a \"\"course\"\" which implied that terrorists and criminals use cash regularly - whether we agree or disagree is irrelevant - this is what the course implied. It's important to understand that many people use cash-only budgets because it's easier than relying on the banking system which charges overdraft fees for going over, or in some cases, you pay more at merchants because of card usage (some merchants give discounts for cash). If someone has a budget of $10K a month and they choose to use cash, that's perfectly fine. Also, why is it anyone's business what someone does with their private property? This created an interesting contrast among differently aged Americans - older Americans saw the banking system as tyrannical busybodies whereas young Americans didn't care. This is part of why I eventually left the banking system; I felt sick that I had to report this information, but it's amazing how quick everyone is to accept the new rules. Notice how one of the comments asks you what you intend to do with the money, as if it's any of their business. Welcome to the New America©! My answer: If you withdraw $100,000, here is what will more than likely happen: Now, watch the anger at this answer because I'm telling you the truth. This article will explain why. Your very question had a negative 1, as if asking what you're asking is wrong (see the absurdity)! If Joseph Stalin ran for president in the United States, the majority of Americans would welcome him. You have good reason to be concerned; others at this site have noticed this as well.\"" }, { "docid": "14317", "title": "", "text": "There is no common sense in Michigan and money does reveal character. Take a Michigan based business for example of more outrageous behavior that our State reps overlook. Frankenmuth Insurance company located in Frankenmuth Michigan purports in its commitment statement to policyholders to: Frankenmuth Insurance built a solid foundation adhering to its fundamental principles of honesty, integrity, unsurpassed customer service and conservative business practices. With much emphasis on Corporate Governance and common sense, this company located in Frankenmuth Michigan regularly violates its own commitment to policyholders by engaging in egregious conflicts of interest with board members that not only lack integrity, but are of blatant poor judgment for personal gain and detrimental to policyholders. The only policyholders invited to their annual policyholder meetings are employees and retirees of the company so that no one will vote against or challenge their elections. The board members are taken on annual trips with their spouses the week of the annual board meeting wherein on the last day, they (the board) are asked to vote on executive pay and bonuses. After a week of being wined and dined at exclusive resorts such as the One and Only Palmilla in Cabo and the Winn in Vegas the Frankenmuth executives know that the board will give them exorbitant raises and bonuses which is information they again refuse to disclose because of the public outrage their behavior would cause, adversely impacting their business. Getting what they want from the board afforded CEO Stanton a 12,000 sq foot retirement home newly constructed on a 1 million dollar plot of land at Bay Harbor overlooking Lake Michigan. One trip that Frankenmuth executives took 90 people on (those people were executives and spouses and agents and spouses) cost 5 million dollars for one week. That translates to about $53K per person. Bill Schutte pretends to care about the taxpayers dollars and how they are spent yet he thus far has refused to require Frankenmuth to disclose it's egregious spending of lavish trips and entertainment and or investigate the clear conflicts of interest with its board that are costing the taxpayers of Michigan huge dollars in increased premiums. On top of all of this, Frankenmuth admittedly has a computer system that does not track its employees use of policyholder information meaning the public is not safe from potential identity theft nor is the company safe from internal theft. Frankenmuth uses credit reports to jack prices of policyholders up - someones credit has no bearing on their ability to drive and the executives are laughing all the way to the bank with the board in their pocket from canned elections." }, { "docid": "373840", "title": "", "text": "\"&gt; the natural rights of the Jews who must live as second class citizens have certainly been lost. Really? What \"\"natural rights\"\" have they had removed? They are still free to own their own property, dispose of it as THEY see fit - say by not serving Bigot Bobby when he comes into their stores. A \"\"natural right\"\" it something that is innate to being human. You have no natural right to shop or buy things, sorry. &gt; And comparing an actual church to a church-run business like a hospital (the type of business affected by the Obama legislation you allude to) is also inappropriate for the same reason. Only because you don't want to admit that your worldview is based on he exertion of extreme force and prejudice. The fact that anyone would defend violating people's religious beliefs is just one indication of the moral sewer we've been led into by the equal rights nonsense. You do NOT have a right make any business owner - religious or otherwise - do things that are against their beliefs. Period. &gt; . But unless we abridge the rights of those with wealth and power to oppress others through economic means This is left drool of the worst kind. Wealth can only be accumulated via two methods: Theft (which I oppose in all it's forms including yourse wherein you want to seize the property of private citizens that own businesses) and Creation Of Value (whether by goods or services). Setting aside theft for a moment, this means that all wealth *is created because someone, somewhere created great value for other people. Even if I inherit money, it still came from one of these two sources. Most importantly *it does not bleong to the public, it does not belong to the government*. &gt; Being FORCED to live life as a second class citizen is FAR WORSE than being forced to do business with people you prefer to shun. Go start a business and get back to us. You are not only wrong, you are wrong pathologically. If a person is refused service for any reason, they can find another store, shop, or vendor. If I refuse to comply with government do-gooding and meddling, I go to jail. Forceful acts by government are ALWAYS far worse than forceful acts in the private sector, at least in the usual case. &gt; If you have any ideas about how to ensure all citizens have a realistic opportunity for success without any government intervention in the economy This is an absurd demand. Apparently, you did not get the memo. THERE IS NO EQUAL OPPORTUNITY IN LIFE FOR SUCCESS. How do I know this? Because some people are smarter, better looking, stronger, take more risks, have better families that support them and so on. The only way to equality of the sort the left keeps gurgling on and on about is to have everything lowered to the lowest possible common denominator. That's how you get the cultural messes like Watts in LA or Englewood in Chicago, downtown D.C., downtown Detroit, Appalachia, and so on. They're \"\"equal\"\" all right - equally miserable. You'd better grow up fast on this one - some people succeeding and a few failing is WAY better than EVERYONE failing... and that's exactly where your collectivist sewer leads. It doesn't matter what you or I think, it's observable in Reality.\"" }, { "docid": "206483", "title": "", "text": "Technically, the answer is no, you can't put more money in to that ISA in that tax year once you've transferred it (unless you've transferred it to a Stocks and Shares ISA). FAQs 7 and 8 from http://www.hmrc.gov.uk/isa/faqs.htm cover these cases: Q. I have transferred current year payments to my cash ISA to a stocks and shares ISA, can I make any further payments to a cash ISA in this tax year? A. Yes - provided you haven't already used up your annual ISA investment allowance (£11,520 in the tax year 2013-14). When you transfer current year payments to your cash ISA to a stocks and shares ISA it is as if that cash ISA had never existed. Any money you saved up to the date of transfer will be treated as if you had invested that money directly in the stocks and shares ISA. For example, if you had put £2,000 in a cash ISA and then transferred it to a stocks and shares ISA you would be able to make further payments totalling £9,520 in that tax year. You could either put all of the £9,520 in the stocks and shares ISA or you could put up to £5,760 in a cash ISA (with the same or a different ISA manager) and the remainder of the £9,520 in the stocks and shares ISA. Q. How many ISAs can I have? A. There are limits on the number of ISA accounts you can subscribe to each tax year. You can only put money into one cash ISA and one stocks and shares ISA. But in different years, you could choose to save with different managers. There are no limits on the number of different ISAs you can hold over time. However, in practice, if you transfer mid-year from Provider A to Provider B, Provider B has no way of telling whether you have already put money in to the ISA with Provider A that year or not, so you will be able to put more money in. I believe that ISA providers do report their subscriptions back to HMRC so they can check for multiple subscriptions (over the limit) in one tax year; but in the past, I have done exactly what you describe and it has never been picked up in any way or caused any problem at all. As long as you stick to total subscriptions within the limit, I'd guess you're unlikely to encounter a problem. (Of course I am not a financial advisor so you should take what I say with the same pinch of salt as you would take any other random advice from the internet)." }, { "docid": "14989", "title": "", "text": "I know this is heresy but if you have funds for significantly more than 6 months of expenses (let's say 12 months), how risky would it be to put it all into stock index funds? Quite risky as if you do need to dip into it, how fast could you get the cash? Also, do you realize the tax implications when you do sell the shares should you have an emergency? In the worst-case scenario, let's say you have a financial emergency at the same time the stock market crashes and loses half its value. You could still liquidate the rest and have sufficient funds for 6 months. Am I underestimating the risks of this strategy? That's not worst case scenario though. Worst case scenario would be another 9/11 where the markets are closed for nearly a week and you need the money but can't get the funds converted to cash in the bank that you can use. This is in addition to the potential wait for a settlement in the case of using ETFs if you choose to go that way. In the case of money market funds, CDs and other near cash equivalents these can be accessed relatively easily which is part of the point. A staggered approach where some cash is kept in house, some in accounts that can easily accessed and some in other investments may make sense though the breakdown would differ depending on how much risk people are willing to take. If it truly is an emergency fund then the odds of needing it should be very slim, so why live with near zero return on that money? Something to consider is what is called an emergency here? For some people a sudden $1,000 bill to fix their car that just broke down is an emergency. For others, there could be emergency trips to visit family that may have gotten into accidents or gotten a diagnosis that they may pass away soon. Consider what do you want to call an emergency here as chances are you may not be considering all that people would think is an emergency. There is the question of what other sources of money do you have to cover should issues arise." }, { "docid": "598313", "title": "", "text": "You should look into the Income Contingent Repayment and Income Sensitive Repayment plans to see which one you may qualify for. Another possibility would be to start taking courses part time at another college so that you can qualify for a deferment. I'm not sure that you can qualify for a deferment if you are currently in default. I've found that negotiating did not work in my case, as the collectors' BATNA would result in them getting more money if they refused to negotiate. I also found that every time the student loans went into default, 30% was added to the balance in fees." }, { "docid": "290236", "title": "", "text": "\"The confusion comes from ambiguity in popular belief -- that businesses are required to accept x_y_x as payment. In reality, a business can state the terms of a transaction to their pleasure. On the other hand, debt is different -- no lender can refuse cash or other legal tender for repayment of debt. Sometimes, people try to split hairs and argue \"\"Well, if I eat a steak and I owe the restaurant $100, they should have to accept my $100 as tender for the debt of my meal.\"\" Not true. The restaurant isn't giving you a line of credit, they're billing you after services rendered, and your payment is due on their terms.\"" }, { "docid": "476299", "title": "", "text": "\"Yes, U.S. currency of any denomination is \"\"legal tender FOR ALL DEBTS, public and private.\"\" But when you go into a store you (normally) don't owe them anything. In that case, it's more like a barter transaction: Your currency for their soda. Meaning that they can refuse to take \"\"your currency.\"\" Open an account at the store, and run up a debt. Then you can pay in any denomination.\"" }, { "docid": "250702", "title": "", "text": "These unclaimed wages were presumably yours for the taking in Year X when employer paid your other wages. Maybe this is just about uncashed paychecks. In that case, they would have appeared on your W-2 for that year. If you filed your return including that W-2 income, then this is likely not new income. This would be a constructive receipt evaluation. Income occurs when you have the right to income, whether or not you have actual receipt of it. For example, if you are paid via cash drops into a piggy bank but you wait a week (for the start of a new tax period) to withdraw your cash from the piggy bank, then the money was constructively received on the day it went into the piggy bank. This prevents taxpayers from structuring their actual receipt of income, for tax purposes or otherwise, in ways at odds with their true economic position. You can't delay taxable income that is legally yours simply by refusing to accept it when you have the right to it. The wages were income at the time your employer proffered the paycheck. You did not cash it, but I suspect that you filed it on that year's taxes. There's a slight wrinkle that when the check went stale your ability to access the money was not so straightforward. However, you still had the legal right to the money, so my perspective is that the analysis did not change when the check went stale." }, { "docid": "526260", "title": "", "text": "Brokerages are supposed to keep your money separate from theirs. So, even if they fail as a company, your money and investments are still there, and can be transferred to another brokerage. It doesn't matter if it's an IRA or taxable account. Of course, as is the case with MF Global, if illegally take their client's money (i.e., steal), it may be a different story. In such cases, SIPC covers up to $500K, of which $250K can be cash, as JoeTaxpayer said. You may be interested in the following news item from the SEC. It's about some proposed changes, but to frame the proposal they lay out the way it is now: http://www.sec.gov/news/press/2011/2011-128.htm The most relevant quote: The Customer Protection Rule (Rule 15c3-3). This SEC rule requires a broker-dealer to segregate customer securities and cash from the firm’s proprietary business activities. If the broker-dealer fails, these customer assets should be readily available to be returned to customers." }, { "docid": "212713", "title": "", "text": "This varies by jurisdiction somewhat but speaking as a Canadian, a small business owner, and accountant (unregistered but some courses and accounting for multiple businesses) this is the answer if you were in Canada. In Canada the cheque cashing limit is 6 months. Therefor any bank will refuse to cash this cheque. It would be totally morally and legally acceptable to ask for a replacement cheque from your employer. In Canada they would generally have no problem issuing a replacement; in other jurisdictions with differing time limits they might want to cancel the original cheque first." }, { "docid": "5188", "title": "", "text": "Basically you have 4 options: Use your cash to pay off the student loans. Put your cash in an interest-bearing savings account. Invest your cash, for example in the stock market. Spend your cash on fun stuff you want right now. The more you can avoid #4 the better it will be for you in the long term. But you're apparently wise enough that that wasn't included as an option in your question. To decide between 1, 2, and 3, the key questions are: What interest are you paying on the loan versus what return could you get on savings or investment? How much risk are you willing to take? How much cash do you need to keep on hand for unexpected expenses? What are the tax implications? Basically, if you are paying 2% interest on a loan, and you can get 3% interest on a savings account, then it makes sense to put the cash in a savings account rather than pay off the loan. You'll make more on the interest from the savings account than you'll pay on interest on the loan. If the best return you can get on a savings account is less than 2%, then you are better off to pay off the loan. However, you probably want to keep some cash reserve in case your car breaks down or you have a sudden large medical bill, etc. How much cash you keep depends on your lifestyle and how much risk you are comfortable with. I don't know what country you live in. At least here in the U.S., a savings account is extremely safe: even the bank goes bankrupt your money should be insured. You can probably get a much better return on your money by investing in the stock market, but then your returns are not guaranteed. You may even lose money. Personally I don't have a savings account. I put all my savings into fairly safe stocks, because savings accounts around here tend to pay about 1%, which is hardly worth even bothering. You also should consider tax implications. If you're a new grad maybe your income is low enough that your tax rates are low and this is a minor factor. But if you are in, say, a 25% marginal tax bracket, then the effective interest rate on the student loan would be more like 1.5%. That is, if you pay $20 in interest, the government will then take 25% of that off your taxes, so it's the equivalent of paying $15 in interest. Similarly a place to put your money that gives non-taxable interest -- like municipal bonds -- gives a better real rate of return than something with the same nominal rate but where the interest is taxable." }, { "docid": "34480", "title": "", "text": "\"I suppose this could really depend on the part of the world you're in, but there are still many instances of \"\"emergencies\"\" that need \"\"cash\"\". You have to decide how much cash is the right amount, but I still recommend having $1,000 or so in liquid cash. It can really make a huge difference. Let me give a few examples. Bad weather. I live in Florida and after a hurricane if you want gas, food, or water, you're going to need cash. ATM networks are the last to get repaired. Same for internet. Cell services are not at the top of the list. You could be 4-5 days without access to your accounts. If you need anything in that time frame it's cash or the Red Cross. Children. As a foster parent we keep some cash on hand because as kids come in to our care we want to get them in school right away. How are they going to eat? You can't give them your plastic, you haven't had time to setup \"\"lunch accounts\"\" or the like. Cash always works. Along those same lines are bus tickets, clothes, supplies and what not. Not everywhere will take an ATM card, and if your money is tied up in a stock then what are you supposed to do for 3 days? Tell your new kid that he can't eat? Big Emergency problems. Like your car breaks down on the interstate. Sure it can get towed to the dealership, and yes they will add the tow to your bill, and sure you have a few days to pay it (while your car gets fixed), but how are you going to get around? Not all taxis take plastic around here. Almost none of the busses take plastic even though they are supposed to. Lost Wallet or ID theft. Lose your wallet, good luck getting into your bank accounts. It can take weeks to establish your ID after you lose it in some cases. You want your ID, but you need your birth certificate. You have to GO to the state of birth and request it. Oh but wait, to travel you need an ID. No problem send away for it, but wait, you need to send them money to mail it. To bad all your money is tied up. Running or Evacuating - So you need to evacuate for some reason. No big deal. But all your money is in a place you can't get to it. How do you put gas in your car. Lets stick with it and say you get to \"\"cash out\"\" an account of some kind. Guess what, they're not going to mail it to some random address. Now you're stuck fighting support centers to get them to understand that you need your funds delivered to New York even though you live in Florida. In short, you don't need $100,000 in liquid funds, but there are a few cases that you need something liquid. You also make a lot of assumptions. For example, not every one will have health insurance, or a heath problem that is covered by their insurance. Some serious home repairs are \"\"down payment\"\" upfront. Car problems like an accident that means you need a rental can totally be up front. Especially if credit cards can't be used.\"" } ]

[ { "docid": "193081", "title": "", "text": "You have to take legal tender to settle a debt. If your business model doesn't involve the customer incurring a debt that is then settled, you don't have to take cash. For example, in a restaurant where you pay after eating, you can insist on paying cash, because you're settling a debt. But in McDonald's they can refuse your cash at the counter, because you've not received your food yet and so no debt has been incurred." } ]

[ { "docid": "293048", "title": "", "text": "\"In the unlikely case that noone finds a way to extract resources from the company and distribute them to shareholders periodically in a way that's de facto equivalent to dividends, any company can be dissolved. The assets of the company would be sold for their market value, the liabilities would have to be settled, and the net result of all this (company cash + sale results - liabilities) would be distributed to shareholders proportionally to their shares. The 'liquidation value' is generally lower than the market value of a company as an ongoing concern that's making business and earning profit, but it does put a floor on it's value - if the stock price is too low, someone can buy enough stock to get control of the company, vote to dissolve it, and make a profit that way; and the mere fact that this can happen props up the stock price. Companies could even be created for a limited time period in the first hand (which has some historical precedent with shareholders of 'trading companies' with lifetime of a single trade voyage). Imagine that there is some company Megacorp2015 where shareholders want to receive $1M of its cash as \"\"dividends\"\". They can make appropriate contracts that will form a new company called Megacorp2016 that will take over all the ongoing business and assets except $1M in cash, and then liquidate Megacorp2015 and distribute it's assets (shares of Megacorp2016 and the \"\"dividend\"\") among themselves. The main difference from normal dividends is that in this process, you need cooperation from any lenders involved, so if the company has some long-term debts then they would need agreement from those banks in order to pay out \"\"dividends\"\". Oh, and everyone would have to pay a bunch more to lawyers simply to do \"\"dividends\"\" in this or some other convoluted way.\"" }, { "docid": "598313", "title": "", "text": "You should look into the Income Contingent Repayment and Income Sensitive Repayment plans to see which one you may qualify for. Another possibility would be to start taking courses part time at another college so that you can qualify for a deferment. I'm not sure that you can qualify for a deferment if you are currently in default. I've found that negotiating did not work in my case, as the collectors' BATNA would result in them getting more money if they refused to negotiate. I also found that every time the student loans went into default, 30% was added to the balance in fees." }, { "docid": "130209", "title": "", "text": "\"I bought a car a few years ago. The salesman had the order, I knew the car I wanted and we had a price agreed on. When I refused the payment plan/loan, his manager came over and did a hard sell. \"\"99% of buyers take the financing\"\" was the best he could do. I told him I was going to be part of the 1%. With rates so low, his 2 or 3% offer was higher than my own cost of money. He went so far as to say that I could just pay it off the first month. Last, instead of accepting a personal check and letting me pick up the car after it cleared, he insisted on a bank check to start the registration process. (This was an example of one dealer, illustrating the point.) In other cases, for a TV, a big box store (e.g. Best Buy) isn't going to deal for cash, but a small privately owned \"\"mom and pop\"\" shop might. The fees they are charged are pretty fixed, they don't pay a higher fee cause I get 2% cash back, vs your mastercard that might offer less.\"" }, { "docid": "311285", "title": "", "text": "If your business is operating on an accrual basis, the income would be counted as occurring in 2016. If your business is operating on a cash basis, the income would be counted as occurring in 2017. If you don't know what that means, you are probably using a cash basis for your business, which means income and expenses take place when you actually receive or incur them. According to cash-based principles, if you receive the check in 2017, that is when you report the income. For more information, see Accounting Methods in Publication 538. In summary, you can choose both as an individual and as a business which accounting method you want to use, and it is not trivial to change it. Cash basis on a calendar year is more or less the default, and is recommended unless you have a specific reason for doing something else." }, { "docid": "471247", "title": "", "text": "The purpose is to go public but also to generate more wealth. The real money comes when market values you at a price more than your cash flow. If a company brings in $1000 of cash flow, then that is what the employees and owners have to distribute among themselves. But if they are likely to increase to $2000 next and $4000 next year and they go public then the stock will do well. In this case, the promoters and employees with options/RSUs will benefit as well. The increased visibility is also very useful. Look at Google or FB. They didn't need the IPO proceed when they went public. They had enough cash from their business but then they would only have $1-10 billion a year. But due to the IPO their investors and employees have a huge net worth. Basically, with just a small % of shares in the public you can value the company at a high price valuing in the future cash flows (with a discount rate etc.). So instead of realizing the profit over the next 15 years, you get to enjoy it right away." }, { "docid": "209754", "title": "", "text": "\"The value of a stock ultimately is related to the valuation of a corporation. As part of the valuation, you can estimate the cash flows (discounted to present time) of the expected cash flows from owning a share. This stock value is the so-called \"\"fundamental\"\" value of a stock. What you are really asking is, how is the stock's market price and the fundamental value related? And by asking this, you have implicitly assumed they are not the same. The reason that the fundamental value and market price can diverge is that simply, most shareholders will not continue holding the stock for the lifespan of a company (indeed some companies have been around for centuries). This means that without dividends or buybacks or liquidations or mergers/acquisitions, a typical shareholder cannot reasonably expect to recoup their share of the company's equity. In this case, the chief price driver is the aggregate expectation of buyers and sellers in the marketplace, not fundamental evaluation of the company's balance sheet. Now obviously some expectations are based on fundamentals and expert opinions can differ, but even when all the experts agree roughly on the numbers, it may be that the market price is quite a ways away from their estimates. An interesting example is given in this survey of behavioral finance. It concerns Palm, a wholly-owned subsidiary of 3Com. When Palm went public, its shares went for such a high price, they were significantly higher than 3Com's shares. This mispricing persisted for several weeks. Note that this facet of pricing is often given short shrift in standard explanations of the stock market. It seems despite decades of academic research (and Nobel prizes being handed out to behavioral economists), the knowledge has been slow to trickle down to laymen, although any observant person will realize something is amiss with the standard explanations. For example, before 2012, the last time Apple paid out dividends was 1995. Are we really to believe that people were pumping up Apple's stock price from 1995 to 2012 because they were waiting for dividends, or hoping for a merger or liquidation? It doesn't seem plausible to me, especially since after Apple announced dividends that year, Apple stock ended up taking a deep dive, despite Wall Street analysts stating the company was doing better than ever. That the stock price reflects expectations of the future cash flows from the stock is a thinly-disguised form of the Efficient Market Hypothesis (EMH), and there's a lot of evidence contrary to the EMH (see references in the previously-linked survey). If you believe what happened in Apple's case was just a rational re-evaluation of Apple stock, then I think you must be a hard-core EMH advocate. Basically (and this is elaborated at length in the survey above), fundamentals and market pricing can become decoupled. This is because there are frictions in the marketplace making it difficult for people to take advantage of the mispricing. In some cases, this can go on for extended periods of time, possibly even years. Part of the friction is caused by strong beliefs by market participants which can often shift pressure to supply or demand. Two popular sayings on Wall Street are, \"\"It doesn't matter if you're right. You have to be right at the right time.\"\" and \"\"It doesn't matter if you're right, if the market disagrees with you.\"\" They suggest that you can make the right decision with where to put your money, but being \"\"right\"\" isn't what drives prices. The market does what it does, and it's subject to the whims of its participants.\"" }, { "docid": "212713", "title": "", "text": "This varies by jurisdiction somewhat but speaking as a Canadian, a small business owner, and accountant (unregistered but some courses and accounting for multiple businesses) this is the answer if you were in Canada. In Canada the cheque cashing limit is 6 months. Therefor any bank will refuse to cash this cheque. It would be totally morally and legally acceptable to ask for a replacement cheque from your employer. In Canada they would generally have no problem issuing a replacement; in other jurisdictions with differing time limits they might want to cancel the original cheque first." }, { "docid": "476299", "title": "", "text": "\"Yes, U.S. currency of any denomination is \"\"legal tender FOR ALL DEBTS, public and private.\"\" But when you go into a store you (normally) don't owe them anything. In that case, it's more like a barter transaction: Your currency for their soda. Meaning that they can refuse to take \"\"your currency.\"\" Open an account at the store, and run up a debt. Then you can pay in any denomination.\"" }, { "docid": "350547", "title": "", "text": "\"Good debt is very close to an oxymoron. People say student loans are \"\"good debt,\"\" but I beg to differ. The very same \"\"good debt\"\" that allowed me to get an education is the very same \"\"bad debt\"\" that doesn't allow me to take chances in my career - meaning, I would prefer to have a 'steady' job over starting a business. (That's my perogative, of course, but I am not willing to take that 'risk.' /endtangent @Harmanjd provided the two really good reason for using cash over borrowing. We have a tendency in this culture to find reasons to borrow. It is better for you to make a budget, based on what you want, and save up for it. Make a \"\"dream list\"\" for what you want, then add up the costs for everything. If that number makes your head hurt, start paring down on things you 'want.' Maybe you install just a wine cooler instead of a wine cooler and a beer tap, or vice-versa. And besides, if something comes up - you can always stop saving money for this project and deal with whatever came up and then resume saving when you're done. Or in the case of the kitchen, maybe you do it in stages: cabinets one year, countertops the next, flooring the year after that, and then the appliances last. You don't have to do it all at once. As someone who is working toward debt freedom, it feels nice whenever we have one less payment to budget for every month. Don't burden yourself to impress other people. Take your time, get bids for the things you can't (or won't) do yourself, and then make a decision that's best for your money.\"" }, { "docid": "12787", "title": "", "text": "There is no law requiring someone to return a refused check. You need to clarify whether this payment is to establish a retainer, or to pay for services rendered. Either way you should stop payment on the check and send them a certified letter explaining that you are stopping payment on the check because they refused it. If the payment is to establish a retainer, then the issue is simple: the lawyer requires $10,000 as a retainer before you can engage them and until then you have no relationship with them. If that is the amount they want, then less than that is not accepted. If the payment is for services rendered already and you owe them money, then it is a completely different situation. Refusing partial payment means they are getting ready to sue you. In a collection suit, the larger the amount is, the better. Normally, someone owed money will only refuse a partial payment if they anticipate having to sue the debtor and they want to maximize their leverage in case of a court judgement in their favor. A creditor has the right to refuse a partial payment." }, { "docid": "505461", "title": "", "text": "\"You state \"\"Any info will be appreciated\"\", so here's some background information on my answer (you can skip to my answer): When I worked for banks, I was required to submit suspicious activity to the people above me by filling out a form with a customer's name, SSN, account number(s) and ID. You may hear in media that it is $10K or sometimes $5K. The truth is that it could be lower than that, depending on what the institution defines as suspicious. Every year we were required to take a \"\"course\"\" which implied that terrorists and criminals use cash regularly - whether we agree or disagree is irrelevant - this is what the course implied. It's important to understand that many people use cash-only budgets because it's easier than relying on the banking system which charges overdraft fees for going over, or in some cases, you pay more at merchants because of card usage (some merchants give discounts for cash). If someone has a budget of $10K a month and they choose to use cash, that's perfectly fine. Also, why is it anyone's business what someone does with their private property? This created an interesting contrast among differently aged Americans - older Americans saw the banking system as tyrannical busybodies whereas young Americans didn't care. This is part of why I eventually left the banking system; I felt sick that I had to report this information, but it's amazing how quick everyone is to accept the new rules. Notice how one of the comments asks you what you intend to do with the money, as if it's any of their business. Welcome to the New America©! My answer: If you withdraw $100,000, here is what will more than likely happen: Now, watch the anger at this answer because I'm telling you the truth. This article will explain why. Your very question had a negative 1, as if asking what you're asking is wrong (see the absurdity)! If Joseph Stalin ran for president in the United States, the majority of Americans would welcome him. You have good reason to be concerned; others at this site have noticed this as well.\"" }, { "docid": "260956", "title": "", "text": "I'd be very surprised (but feel free to prove me wrong) if he advised people to pay in physical cash. He probably means to not take out debt. In the world of M&amp;A, the term cash is used a bit differently. You can fund a deal with cash, stock, or a combination of both. However, there are different sources of cash. You can have funds in your bank account, or you can go borrow funds in the debt market. So what this means for this deal is that AMZN shareholders will not be giving up any equity for the acquisition. They will either use cash that is in their bank accounts or go to the debt markets, raise debt, and use the proceeds to pay WFM shareholders. No one shows up with physical cash in either case. It's wired over to the people who will then distribute the money to the shareholders." }, { "docid": "315158", "title": "", "text": "I maintain a strong bias against taking on any debt, of any sort, and I feel it serves me well. This is not to say I would never take on a debt, like a car loan, mortgage, or educational loan. It's just that there is a built in bias against it. The reason that bias is good is that, in my view, taking on (unforced) debt presents the following problems: Therefore, the standing no-debt bias. That said, if there is a very compelling reason to take on unforced debt, it could override the bias. The best example I know is that my mother bought a house with a mortgage when she had the cash, because CDs at that time were paying far more than the mortgage interest rate (this was back around the 80s when CDs hit an absurd 18%!). To not take on that debt would be refusing free money! But that's a rare case. Today, CDs and other guaranteed interest streams are at historical lows, so this factor is really not in play." }, { "docid": "287162", "title": "", "text": "\"I looked this up on Wikipedia, and was hoping the answer would be \"\"no - stores cannot refuse legal tender\"\", but unfortunately, it's not the case! If the retailer wants to go to the lengths of refusing certain denominations to protect themselves from counterfeit currency, they are fully within their rights to do so. The \"\"Legal Tender\"\" page on Wikipedia says this about Canadian bills: [...] Retailers in Canada may refuse bank notes without breaking the law. According to legal guidelines, the method of payment has to be mutually agreed upon by the parties involved with the transactions. For example, convenience stores may refuse $100 bank notes if they feel that would put them at risk of being counterfeit victims [...] What is interesting about what I found out, is that legal tender cannot be refused if it is in repayment of an existing debt (i.e. not a store transaction for which there existed no previous debt). So you could offload your $100 bills when repaying your Sears credit card account (or pay in pennies if you wanted to!) and they couldn't refuse you!\"" }, { "docid": "384145", "title": "", "text": "Intellectually and logically, it shouldn't bother me for a second to charge something for a buck. It's a losing proposition for the merchant, but their immediate business costs should be of little concern to me. (They're making a choice to sell that item to me at that price and by accepting that means of payment, right?) but the more I charge as opposed to paying cash, the more cash back I get. In my old-ish age, I've gotten a little softer and will pay cash more often for smaller amounts because I understand the business costs, but it's not a matter of caring what other people think. Accepting credit cards, or not, is a business decision. It's usually a good one. But with that decision come the rules, which up until about a year ago, meant that merchants couldn't set a minimum charge amount. Now that's not the case; merchant account providers can no longer demand that their merchant clients accept all charges, though they are allowed to set a minimum amount that is no lower than $10.00. In the end, it's a matter of how much you're willing to pay in order to influence people's thinking of you, because the business/financial benefits of doing one or the other are pretty clear." }, { "docid": "488258", "title": "", "text": "A Lease is an entirely different way of getting a car. In two situations it makes sense, in all other scenarios it generally doesn't make sense to lease. In the case of always wanting a new car every 2 or 3 years it can make sense to lease. Of course if you drive more the allowed miles you will pay extra at the end of the lease. If you can take the monthly lease as a business expense leasing makes sense. Otherwise you want to pay cash, or get financing. Does zero percent make sense? Sometimes. The only way to make sense of the numbers is to start with your bank, have them approve of the loan first. Then armed with the maximum loan amount they will give you and the rate and the length of the loan, then visit the dealer. You have to run the numbers for your situation. It depends on your income, your other expenses, your credit score, your bank, what deal the dealership is running, how much you have for a down payment. Here is an example. For a recent loan situation I saw: 36 months, 1.49% rate, 20K loan, total interest paid: ~$466. Armed with that information can the person get a better deal at the dealership? There was only one way to find out. In that case the credit union was better. The rebate was larger than the interest paid." }, { "docid": "376797", "title": "", "text": "When you're selling something through a provider, like Craig's List or newspapers, the only thing that may limit your choices is the provider. They may refuse your post if it's against their rules or the law. But luckily they usually don't limit or enforce certain payment choices. These private business providers have the right to do so if they want. You don't need to be their customer. They may state their terms for using the service and even refuse service (before any payment is made). The fun part is that you may do so as well. Just remember to state your terms in your post so the prospective buyers are aware of them. I've found it best to put payment and delivery terms in separate lines so that they are easily noticeable, for example: Nice victorian handbasket with gold embroidery, only used once. Signed by the original author. Comes with a certificate of authenticity. No delivery, only cash payments." }, { "docid": "372052", "title": "", "text": "Businesses are free to decide what payment methods they accept for their goods and services. Businesses sometimes advertise what credit cards they accept by posting some stickers at their door. When your credit card isn't among them and you don't have enough cash with you, ask about your card before you order. If a business doesn't accept your credit card, your best recourse is to take your business elsewhere. When you already ate there and got into an awkward situation because you assumed that they would accept your card, you might also want to write an online review of the place and warn others to bring cash for their visit (but please be fair in the review. When the food and service are decent, a restaurant doesn't deserve a one star rating just because they don't take credit cards). Note that businesses have good reasons to not accept credit cards. It often means additional cost for them in form of: But there is also a more shady reason. Taking payment in cash means that there is no electronic trail of the transaction. That makes it far easier for an establishment to misreport their income. They might under-report it to evade taxes or over-report it to launder money (both are illegal, of course)." }, { "docid": "147624", "title": "", "text": "\"The decision whether this test is or is not met seems to be highly dependent on the specific situation of the employer and the employee. I think that you won't find a lot of general references meeting your needs. There is such a thing as a \"\"private ruling letter,\"\" where individuals provide specific information about their situation and request the IRS to rule in advance on how the situation falls with respect to the tax law. I don't know a lot about that process or what you need to do to qualify to get a private ruling. I do know that anonymized versions of at least some of the rulings are published. You might look for such rulings that are close to your situation. I did a quick search and found two that are somewhat related: As regards your situation, my (non-expert) understanding is that you will not pass in this case unless either (a) the employer specifies that you must live on the West Coast or you'll be fired, (b) the employer would refuse to provide space for you if you moved to Boston (or another company location), or (c) you can show that you could not possibly do your job out of Boston. For (c), that might mean, for example, you need to make visits to client locations in SF on short-notice to meet business requirements. If you are only physically needed in SF occasionally and with \"\"reasonable\"\" notice, I don't think you could make it under (c), although if the employer doesn't want to pay travel costs, then you might still make it under (a) in this case.\"" } ]

[ { "docid": "341413", "title": "", "text": "\"They don't have to take cash if they reasonably told you in advance they don't take cash, because they made fair effort to prevent you from incurring a debt. They don't have to take cash if the transaction hasn't yet happened (not a debt) or if it can be easily undone at no cost to either party - such as a newspaper subscription they can just stop delivering. Both of these reasons are limited by the rules against discrimination, see below. They don't have to take cash if it's impracticable. For instance a transit bus when fares first went to $1.00, it took years to fund new fareboxes able to take paper money. You don't have to take a mortgage payment in pennies. Liquor stores don't have to take $100 bills. (it requires them to keep too much change in the till, which makes them a robbery target). Trouble arises when it appears there's an ulterior motive for the rule. Suppose a Landlord Jim requires rent to be paid with EFT. Rent-controlled Marcie tells the judge \"\"It's a scheme to oust me, he knows I'm unbanked\"\". Jim counters \"\"No. I got mugged last month because criminals know when I collect cash rents.\"\" It will turn on whether Jim can show good-faith effort to work with his unbanked tenants to find other ways to pay. If Jim does a particularly bad job of this, he could find himself paying Marcie's legal bills! Even worse if the ulterior motive is discrimination. Chet the plumber hates Muslims. Alice the feed supplier hates the Amish. So they decide to take credit cards only, knowing those people's religions don't allow them. Their goose is cooked once they can't show any other reasonable reason to refuse cash.\"" } ]

[ { "docid": "384145", "title": "", "text": "Intellectually and logically, it shouldn't bother me for a second to charge something for a buck. It's a losing proposition for the merchant, but their immediate business costs should be of little concern to me. (They're making a choice to sell that item to me at that price and by accepting that means of payment, right?) but the more I charge as opposed to paying cash, the more cash back I get. In my old-ish age, I've gotten a little softer and will pay cash more often for smaller amounts because I understand the business costs, but it's not a matter of caring what other people think. Accepting credit cards, or not, is a business decision. It's usually a good one. But with that decision come the rules, which up until about a year ago, meant that merchants couldn't set a minimum charge amount. Now that's not the case; merchant account providers can no longer demand that their merchant clients accept all charges, though they are allowed to set a minimum amount that is no lower than $10.00. In the end, it's a matter of how much you're willing to pay in order to influence people's thinking of you, because the business/financial benefits of doing one or the other are pretty clear." }, { "docid": "395995", "title": "", "text": "\"Understood. But based on the OP, it's not categorically clear what they were refusing. If they refused to quote the balance and/or refused to take a phone payment that was otherwise in keeping with the cardholder agreement (i.e., the cardmember called the correct number for phone payments and balance-checking, etc), then yeah, they were not only being unreasonable, but also violating the contract. What I read as ambiguous is whether the cardholder was specifically asking for the *payoff* balance/amount, and whether they were following process for phone-payments and balance-checking, etc. IOW, it's not necessarily \"\"illegal\"\" and might not even be unreasonable for the customer-service number to have different departments for balance-checking and phone-payments versus card-cancellation. It's not falsifiably clear from the OP that the cardholder was not asking the person on the other end of the phone for categorical statements of fact that they were obligated to make. I'm not accusing anyone of lying or saying that the CC company was acting reasonably, I'm just saying that language such as **\"\"They do not provide mid-cycle payoff quotes\"\"** is not evidence that they were doing any kind of funny-business.\"" }, { "docid": "287162", "title": "", "text": "\"I looked this up on Wikipedia, and was hoping the answer would be \"\"no - stores cannot refuse legal tender\"\", but unfortunately, it's not the case! If the retailer wants to go to the lengths of refusing certain denominations to protect themselves from counterfeit currency, they are fully within their rights to do so. The \"\"Legal Tender\"\" page on Wikipedia says this about Canadian bills: [...] Retailers in Canada may refuse bank notes without breaking the law. According to legal guidelines, the method of payment has to be mutually agreed upon by the parties involved with the transactions. For example, convenience stores may refuse $100 bank notes if they feel that would put them at risk of being counterfeit victims [...] What is interesting about what I found out, is that legal tender cannot be refused if it is in repayment of an existing debt (i.e. not a store transaction for which there existed no previous debt). So you could offload your $100 bills when repaying your Sears credit card account (or pay in pennies if you wanted to!) and they couldn't refuse you!\"" }, { "docid": "315158", "title": "", "text": "I maintain a strong bias against taking on any debt, of any sort, and I feel it serves me well. This is not to say I would never take on a debt, like a car loan, mortgage, or educational loan. It's just that there is a built in bias against it. The reason that bias is good is that, in my view, taking on (unforced) debt presents the following problems: Therefore, the standing no-debt bias. That said, if there is a very compelling reason to take on unforced debt, it could override the bias. The best example I know is that my mother bought a house with a mortgage when she had the cash, because CDs at that time were paying far more than the mortgage interest rate (this was back around the 80s when CDs hit an absurd 18%!). To not take on that debt would be refusing free money! But that's a rare case. Today, CDs and other guaranteed interest streams are at historical lows, so this factor is really not in play." }, { "docid": "377853", "title": "", "text": "Even where national law might allow such a practice, the law in an individual province or state (either for issuing or receiving bank) might not; or if that does then the receiving bank may have its own regulations or compliance practice which may not permit them to accept an altered cheque. In any case, printed numbers are usually machine-readable, and a corrected cheque would not be. The question needs a specific answer which addresses the specific circumstances involved (which are not stated, at the time of writing this), but for the general question “Should I alter a printed cheque?” the answer must be no. Cheque numbers are used for identification of the cheque. In many cases, there is no verification of uniqueness and it would be perfectly acceptable simply to use cheques with duplicate numbers: a cheque is merely an order to the bank to make a payment. But you would not be able to identify a particular payment on your statement, and neither would the issuing bank if you wanted one stopped. Where the number is verified as unique, then clearing the payment may be refused or at best delayed in order to be queried. Making an obvious amendment to a cheque’s details is likely to raise a red flag. The receiving bank would not be able to tell if you did it, or the payee; they would not know why. They may suspect that it was done in order to render the cheque unidentifiable [even though the opposite is in fact the case] and refuse to accept it. They may refuse to accept it because it could not be read automatically. Any refusal would sour your relationship with your payees. Presumably your printing house (or your bank, if they printed them) has made the error: raise it with them and have them reprint the batch. Ask your bank what to do with the incorrect cheques: they may want them returned to the bank, or they may be happy for you to keep (and even use) them. If the latter, I suggest you shred them." }, { "docid": "146761", "title": "", "text": "A bank needs to make sure they won't lose money by cashing a check. When you have an account with a bank and you cash a check, if the check ends up not getting paid, the bank will take the money back out of your account. This could happen for a number of reasons: the check could bounce (not enough money in the check writer's account), it could be a fraudulent (fake) check, or the payment could have been stopped on that check. Treasury checks are more problematic for banks than private checks; the government has given themselves more power to refuse to pay a check than the average person has. As a result, banks are already overly cautious about cashing treasury checks. The fact that you have a big check increases the risk for the bank. You'll have to ask around at different banks to see what they will do for you and what type of fee (if any) they will charge. Some banks might cash it for a fee; others might require that you open a savings account and wait a certain number of days after depositing the check before withdrawing your money." }, { "docid": "275249", "title": "", "text": "\"There are three (or four) ways that a company can grow: (Crowdfunding is a relatively new (in mainstream businesses) alternative financing method where people will finance a company with the expectation that they will benefit from the product or service that they provide.) Obviously a startup has no prior income to use, so it must either raise money through equity or debt. People say that one must borrow contingent on their salary. Banks lend money based on the ability to pay the loan back plus interest. For individuals, their income is their primary source of cash flow, so, yes, it is usually the determining factor in getting a loan. For a business the key factor is future cash flows. So a business will borrow money, say, to buy a new asset (like a factory) that will be used to generate cash flows in the future so that they can pay down the debt. If the bank believes that the use of the money is going to be profitable enough that they will get their money back with interest, they'll loan the money. Equity investors are essentially the same, but since they don't get a guaranteed payback (they only get paid through non-guaranteed dividends or liquidation), their risk is higher and they are looking for higher expected returns. So the question I'd have as a bank or equity investor is \"\"what are you going to do with the money?\"\" What is your business strategy? What are you going to do that will make profits in the future? Do you have a special idea or skill that you can turn into a profitable business? (Crowdfunding would be similar - people are willing to give you money based on either the social or personal benefit of some product or service.) So any business either starts small and grows over time (which is how the vast majority of businesses grow), or has some special idea, asset, skill, or something that would make a bank willing to take a risk on a huge loan. I know, again, that people here tend to turn blind eyes on unfortunate realities, but people do make giant businesses without having giant incomes. The \"\"unfortunate reality\"\" is that most startups fail. Which may sound bad, but also keep in mind that most startups are created by people that are OK with failing. They are people that are willing to fail 9 times with the thought that the 10th one will take off and make up for the losses of the first 9. So I would say - if you have some great idea or skill and a viable strategy and plan to take it to market, then GO FOR IT. You don't need a huge salary to start off. You need something that you can take to market and make money. Most people (myself included) either do not have that idea or skill to go out on their own, or don't have the courage to take that kind of risk. But don't go in assuming all you need is a loan and you'll be an instant millionaire. You might, but the odds are very long.\"" }, { "docid": "260956", "title": "", "text": "I'd be very surprised (but feel free to prove me wrong) if he advised people to pay in physical cash. He probably means to not take out debt. In the world of M&amp;A, the term cash is used a bit differently. You can fund a deal with cash, stock, or a combination of both. However, there are different sources of cash. You can have funds in your bank account, or you can go borrow funds in the debt market. So what this means for this deal is that AMZN shareholders will not be giving up any equity for the acquisition. They will either use cash that is in their bank accounts or go to the debt markets, raise debt, and use the proceeds to pay WFM shareholders. No one shows up with physical cash in either case. It's wired over to the people who will then distribute the money to the shareholders." }, { "docid": "212713", "title": "", "text": "This varies by jurisdiction somewhat but speaking as a Canadian, a small business owner, and accountant (unregistered but some courses and accounting for multiple businesses) this is the answer if you were in Canada. In Canada the cheque cashing limit is 6 months. Therefor any bank will refuse to cash this cheque. It would be totally morally and legally acceptable to ask for a replacement cheque from your employer. In Canada they would generally have no problem issuing a replacement; in other jurisdictions with differing time limits they might want to cancel the original cheque first." }, { "docid": "63980", "title": "", "text": "To be honest, if you have to ask tips about taking over your family business, someone really dropped the ball on showing you the business in the first place. Anyway, learn yourself some basic bookkeeping/accounting. Money management/tax handling will be something you will need to know, even if you have staff to handle this for you. Learn the specific product/service/whatever you offer. Nothing can be worse than having no clue what your product/service does and you're running it. Shadow the family member(s) that are running it now. Find out what they do throughout their day involving the business. Whoever your replacing is the one you should focus on most. Also make sure you understand your branding, quality, and price measures. Any basic business class will teach you that branding, quality, and price are the three factors of a business's success. Where you fail in one, you take up in another. For instance, Apple has horrible prices. Extremely expensive. How do they make it up? Well, quality is about on par with other products (since they largely come from the same source as competitors), but the iPhone and iPod are well known brands (far more recognized than the smartphone and MP3 player that they are, instead called by the specific product name). Same with Kleenex. No one asks for a facial tissue. They ask for a Kleenex. That's strong branding that connects the consumer to the product. Anyway, just make sure you know where your points fall on those three lines in your business. Improve as you can, but understand where your main fall back is. Best prices, quality, or most well known? Lastly, don't doubt that you can do this. Similarly, don't overcompensate. Your friends will all ask for deals and discounts and you'd do best to deny them in most cases. Family will always want a cut and will probably get nasty in some cases (mattering by how you're set up). When dealing with employees, remember that they work for you: You're not friends. Nothing destroys a staff faster than the boss trying to be friends with everyone and ends up promoting the schmoozer. Eh, not sure what else to toss out. That covers a lot of bases, but I'm sure I can think of more later." }, { "docid": "598313", "title": "", "text": "You should look into the Income Contingent Repayment and Income Sensitive Repayment plans to see which one you may qualify for. Another possibility would be to start taking courses part time at another college so that you can qualify for a deferment. I'm not sure that you can qualify for a deferment if you are currently in default. I've found that negotiating did not work in my case, as the collectors' BATNA would result in them getting more money if they refused to negotiate. I also found that every time the student loans went into default, 30% was added to the balance in fees." }, { "docid": "407505", "title": "", "text": "\"This answer will expand a bit on the theory. :) A company, as an entity, represents a pile of value. Some of that is business value (the revenue stream from their products) and some of that is assets (real estate, manufacturing equipment, a patent portfolio, etc). One of those assets is cash. If you own a share in the company, you own a share of all those assets, including the cash. In a theoretical sense, it doesn't really matter whether the company holds the cash instead of you. If the company adds an extra $1 billion to its assets, then people who buy and sell the company will think \"\"hey, there's an extra $1 billion of cash in that company; I should be willing to pay $1 billion / shares outstanding more per share to own it than I would otherwise.\"\" Granted, you may ultimately want to turn your ownership into cash, but you can do that by selling your shares to someone else. From a practical standpoint, though, the company doesn't benefit from holding that cash for a long time. Cash doesn't do much except sit in bank accounts and earn pathetically small amounts of interest, and if you wanted pathetic amounts of interests from your cash you wouldn't be owning shares in a company, you'd have it in a bank account yourself. Really, the company should do something with their cash. Usually that means investing it in their own business, to grow and expand that business, or to enhance profitability. Sometimes they may also purchase other companies, if they think they can turn a profit from the purchase. Sometimes there aren't a lot of good options for what to do with that money. In that case, the company should say, \"\"I can't effectively use this money in a way which will grow my business. You should go and invest it yourself, in whatever sort of business you think makes sense.\"\" That's when they pay a dividend. You'll see that a lot of the really big global companies are the ones paying dividends - places like Coca-Cola or Exxon-Mobil or what-have-you. They just can't put all their cash to good use, even after their growth plans. Many people who get dividends will invest them in the stock market again - possibly purchasing shares of the same company from someone else, or possibly purchasing shares of another company. It doesn't usually make a lot of sense for the company to invest in the stock market themselves, though. Investment expertise isn't really something most companies are known for, and because a company has multiple owners they may have differing investment needs and risk tolerance. For instance, if I had a bunch of money from the stock market I'd put it in some sort of growth stock because I'm twenty-something with a lot of savings and years to go before retirement. If I were close to retirement, though, I would want it in a more stable stock, or even in bonds. If I were retired I might even spend it directly. So the company should let all its owners choose, unless they have a good business reason not to. Sometimes companies will do share buy-backs instead of dividends, which pays money to people selling the company stock. The remaining owners benefit by reducing the number of shares outstanding, so they own more of what's left. They should only do this if they think the stock is at a fair price, or below a fair price, for the company: otherwise the remaining owners are essentially giving away cash. (This actually happens distressingly often.) On the other hand, if the company's stock is depressed but it subsequently does better than the rest of the market, then it is a very good investment. The one nice thing about share buy-backs in general is that they don't have any immediate tax implications for the company's owners: they simply own a stock which is now more valuable, and can sell it (and pay taxes on that sale) whenever they choose.\"" }, { "docid": "561205", "title": "", "text": "Let's clarify some things. Companies allow for the public to purchase their shares through Initial Public Offering (IPO) (first-time) and Seasoned Public Offering (SPO) (all other times). They choose however many shares they want to issue depending on the amount of capital they want to raise. What this means is that the current owners give up some ownership % in exchange for cash (usually). In the course of IPOs and SPOs, it can happen that the public will not buy all shares if there is very little interest, but I would assume that the more probable scenario if very little interest is present is that the shares' value would take a big drop on their issuance date from the proposed IPO/SPO price. After those shares are bought by the public, they are traded on Exchanges which are a secondary and (mostly) do not affect the underlying company. The shares are exchanged from John Doe to Jane Doe as John Doe believes the market value for those shares will take a direction that Jane Doe believes in the opposite. Generally speaking, markets will find an equilibrium price where you can reasonably easily buy-sell securities as the price is not too far from what most participants in the market believe it should be. In cases where all participants agree on the direction (most often in case of a crash) it can be hard to find a party to make a trade with. Say a company just announced negative news with long-lasting effects on the business there will be a surge in sell orders with very few buyers. If you are willing to buy, you will likely very easily find a trading partner but if you are trying to sell instead then you will have to compete for the lowest price against all other sellers. All that to say that in such cases, while shares are technically sellable / purchasable, the end result can be that no shares are purchasable." }, { "docid": "222086", "title": "", "text": "\"Legal tender is by law any denominations of money printed by the Bank of Canada. There is an exclusion to this in that it must also be acceptable to both parties of the transaction. See the following link from the Bank of Canada on Legal Tender and look at the answer to the question of What is \"\"legal tender\"\"? The reason retailers may refuse the \"\"legal tender\"\" is in the case of counterfeit prevention. The stores that purchase the scanning machines are trying to be accommodating by deferring the decision to refuse the \"\"legal tender\"\" after verifying it (checking if it is acceptable).\"" }, { "docid": "84596", "title": "", "text": "\"&gt;You could say the same about any public utility. (except the one largest one, technically) There are literally thousands and thousands of processors, which is not the case with utilities. Additionally, processors don't need to have any kind of office or presence anywhere near the business they're serving, which means being able to choose without geographical restrictions. Also, PayPal is not a utility. This is not a relevant comparison. &gt;Are you saying they are unable, both contractually and technically, to affect the consumer side? They'd have to revoke their partnerships with banks who issue cards, which they aren't going to do, because consumers using cards is how they make money. Banks could choose not to issue cards, but they're already free to do that. (There's no right to a credit card.) &gt;But also by selectively quoting me you are (deliberately?) side-stepping what actually happened in the WikiLeaks case, to focus on the consumer side. Visa and Mastercard prohibited payments to Wikileaks on the basis of WL allegedly facilitating illegal activity. How is that relevant to what PayPal's doing? &gt;You must buy things in different corners of the Internet than I do. The customer experience (to me) is that there is \"\"the store\"\" or you can pay with PayPal. Yes, \"\"the store\"\" is actually a payment processor but this is a quick slippery slope to \"\"what? You can just set up your own payment processor once they've all blocked your legal business\"\". What are you talking about? You acknowledge that the store has its own processing but somehow that's not enough because someday they might not have processing and have to go through PayPal? Processors *already* deny service to legal businesses. Notably, anything considered \"\"high risk\"\" - which includes travel services, pharmaceuticals, firearms, adult entertainment, telemarketing, debt collection, tobacco, and more - but also for businesses with poor credit, high chargebacks, business practices they don't agree with, lots of international transactions, etc. It literally happens all the time. And, there are so many processors (tens of thousands) that there's another processor willing to step in. Tons of websites don't even use PayPal anymore, and the ones that do often layer it on top of a different payment option. (PayPal is trying hard to increase their presence in stores because of the competition in the internet space.) No one is unable to accept payments if they're barred from PayPal. PayPal actually cuts off accounts all the time because people use it for things against PayPal's TOS. Amazon payments, Shopify, and Stripe are the ones that most people know off the tops of their heads for online processing, but there are literally thousands. No one is somehow unable to conduct business if they can't use PayPal. The only time that businesses can't really get processing is if they do something like rack up chargebacks and disappear or commit fraud against a processor. In those cases, the processor can put that business on the Terminated Merchant File (or MATCH list) and other processors will see that there's been a problem with that customer and not take them on. Even in those cases, businesses can rectify the issue and get off the MATCH list or they can look for processors that will serve them anyway and expect to pay a premium for it.\"" }, { "docid": "123902", "title": "", "text": "They cannot refuse to accept coins and demand some other payment after providing a good or service. Legal tender is legal tender for all debts. But until they provide the good or service, they don't have to accept it. In this case, you want the service of depositing money. But by its nature, they have to accept the payment first. In that situation, they can refuse it. There is no law that banks have to accept your deposits. If they don't want you as a customer, that's their problem. Consider switching banks. Historically this was easier and some banks may still do things the old way. Call your local banks and ask. Perhaps you'll find someone happy to do business with you, on your terms. As already said, some coin rolling machines will pay you with gift certificates. If you plan to buy a sufficient amount from the place that accepts the gift certificate, this can get that place to play the fee. That may help you, although it is obviously a limited solution. The goal is to make it so that you only make purchases that you would have anyway. The seller obviously has a different goal. It's possible to buy coin sorters. Heck, you could buy one with a gift certificate from a public machine. Cheap ones require extra work to get the coins rolled and may jam a lot. More expensive ones do more of the work for you. Note that a given sorter that works better may be cheaper than another that doesn't work as well. Cheap is more of a qualitative judgment than a financial measure in this case. If you carry a small amount of change with you, pretty much everywhere accepts small amounts of change for purchases. So if you have been always paying with dollars and dumping the change in a jar, instead always give the correct change (coins). They may still give you dollars in change, but at least you won't get new coins. And you'll use some of your existing coins. Of course, this doesn't scale well. For small purchases, say $1.50, you can often pay the whole thing in change without argument. Or if something is $18.50, you might give them $10, $5, two $1 bills, and the rest in change. If you are buying something and can see that they have little change in one of the coin buckets, offer to swap some change for bills. Sometimes places find that easier than breaking a roll. With vending machines, use change instead of dollar bills. Especially use exact change so as not to convert bills to change. They usually don't take pennies, but they're great with nickels and above. This won't allow you to use change as a way to force yourself to save. But it will keep your change down to a manageable level going forward. And you might be able to use up your existing store. I'm assuming that this isn't a fifty year coin collection that you are just now starting to process. But if you have six months of change, you should be able to use it up in a year or so. I tend to do this. So I rarely have more than a couple dollars in change. No one ever tells me that they don't take change, because I don't give anyone a lot. Maybe $.99 here but more likely $.43 there. Sometimes I give them, e.g., $.07 so as to get $.25 in change rather than $.18. It's a little more work at every transaction, but it saves the big clump of work of rolling the coins. And you don't have to buy wrappers." }, { "docid": "29849", "title": "", "text": "I just listened to a podcast on this topic this week, and Satanicpuppy is pretty much correct. If you are interested, here is a link to the podcast on Legal Lad: Can Businesses Refuse to Accept Cash?" }, { "docid": "373840", "title": "", "text": "\"&gt; the natural rights of the Jews who must live as second class citizens have certainly been lost. Really? What \"\"natural rights\"\" have they had removed? They are still free to own their own property, dispose of it as THEY see fit - say by not serving Bigot Bobby when he comes into their stores. A \"\"natural right\"\" it something that is innate to being human. You have no natural right to shop or buy things, sorry. &gt; And comparing an actual church to a church-run business like a hospital (the type of business affected by the Obama legislation you allude to) is also inappropriate for the same reason. Only because you don't want to admit that your worldview is based on he exertion of extreme force and prejudice. The fact that anyone would defend violating people's religious beliefs is just one indication of the moral sewer we've been led into by the equal rights nonsense. You do NOT have a right make any business owner - religious or otherwise - do things that are against their beliefs. Period. &gt; . But unless we abridge the rights of those with wealth and power to oppress others through economic means This is left drool of the worst kind. Wealth can only be accumulated via two methods: Theft (which I oppose in all it's forms including yourse wherein you want to seize the property of private citizens that own businesses) and Creation Of Value (whether by goods or services). Setting aside theft for a moment, this means that all wealth *is created because someone, somewhere created great value for other people. Even if I inherit money, it still came from one of these two sources. Most importantly *it does not bleong to the public, it does not belong to the government*. &gt; Being FORCED to live life as a second class citizen is FAR WORSE than being forced to do business with people you prefer to shun. Go start a business and get back to us. You are not only wrong, you are wrong pathologically. If a person is refused service for any reason, they can find another store, shop, or vendor. If I refuse to comply with government do-gooding and meddling, I go to jail. Forceful acts by government are ALWAYS far worse than forceful acts in the private sector, at least in the usual case. &gt; If you have any ideas about how to ensure all citizens have a realistic opportunity for success without any government intervention in the economy This is an absurd demand. Apparently, you did not get the memo. THERE IS NO EQUAL OPPORTUNITY IN LIFE FOR SUCCESS. How do I know this? Because some people are smarter, better looking, stronger, take more risks, have better families that support them and so on. The only way to equality of the sort the left keeps gurgling on and on about is to have everything lowered to the lowest possible common denominator. That's how you get the cultural messes like Watts in LA or Englewood in Chicago, downtown D.C., downtown Detroit, Appalachia, and so on. They're \"\"equal\"\" all right - equally miserable. You'd better grow up fast on this one - some people succeeding and a few failing is WAY better than EVERYONE failing... and that's exactly where your collectivist sewer leads. It doesn't matter what you or I think, it's observable in Reality.\"" }, { "docid": "206483", "title": "", "text": "Technically, the answer is no, you can't put more money in to that ISA in that tax year once you've transferred it (unless you've transferred it to a Stocks and Shares ISA). FAQs 7 and 8 from http://www.hmrc.gov.uk/isa/faqs.htm cover these cases: Q. I have transferred current year payments to my cash ISA to a stocks and shares ISA, can I make any further payments to a cash ISA in this tax year? A. Yes - provided you haven't already used up your annual ISA investment allowance (£11,520 in the tax year 2013-14). When you transfer current year payments to your cash ISA to a stocks and shares ISA it is as if that cash ISA had never existed. Any money you saved up to the date of transfer will be treated as if you had invested that money directly in the stocks and shares ISA. For example, if you had put £2,000 in a cash ISA and then transferred it to a stocks and shares ISA you would be able to make further payments totalling £9,520 in that tax year. You could either put all of the £9,520 in the stocks and shares ISA or you could put up to £5,760 in a cash ISA (with the same or a different ISA manager) and the remainder of the £9,520 in the stocks and shares ISA. Q. How many ISAs can I have? A. There are limits on the number of ISA accounts you can subscribe to each tax year. You can only put money into one cash ISA and one stocks and shares ISA. But in different years, you could choose to save with different managers. There are no limits on the number of different ISAs you can hold over time. However, in practice, if you transfer mid-year from Provider A to Provider B, Provider B has no way of telling whether you have already put money in to the ISA with Provider A that year or not, so you will be able to put more money in. I believe that ISA providers do report their subscriptions back to HMRC so they can check for multiple subscriptions (over the limit) in one tax year; but in the past, I have done exactly what you describe and it has never been picked up in any way or caused any problem at all. As long as you stick to total subscriptions within the limit, I'd guess you're unlikely to encounter a problem. (Of course I am not a financial advisor so you should take what I say with the same pinch of salt as you would take any other random advice from the internet)." } ]

[ { "docid": "136662", "title": "", "text": "\"Apartment complexes have had a long history of not accepting cash for payment of rent. This eliminates the problem of robbery and strongly reduces the risks of embezzlement. THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE Article 1, Section 10 of the US Constitution states: No State shall ... make any Thing but gold and silver Coin a Tender in Payment of Debts Previous editions of banknotes stated that the notes were redeemable in gold or in lawful money. The Mint Act of 1792 set gold and silver as legal currency (and that one did not have to accept \"\"base metal coins\"\" for more than $10 which is why coin rolls only go up to $10). The Coinage Act of 1873 dropped silver and made gold the legal standard for currency. In 1933, the \"\"redeemable in gold\"\" was changed by federal statute and the legend you mention was added. Prior to 1933, someone could demand that you pay them in gold and not with a bank note. Legislation in 1933 ended that. This clause in the Constitution leads some political groups to wish to return to a gold standard. I recommend reading the book Greenback as it describes how our currency got the way it did and why that clause appears on currency.\"" } ]

[ { "docid": "278071", "title": "", "text": "\"I strongly suggest you look at CreditKarma and see how each aspect of what you are doing impacts your score. Here's my take - There's an anti-credit approach that many have which, to me, is over the top. \"\"Zero cards, zero credit\"\" feels to me like one step shy of \"\"off the grid.\"\" It's so far to the right that it actually is more of an effort than just playing the game a bit. You are depositing to the card frequently to do what you are doing. That takes time and effort. Why not just pay the bill in full each month, and just track purchases so you move the cash to the account in advance, whether that's physical or on paper? In your case, it's the same as charging one item every few months to keep the card active. If that's what you'd like to do, that's fine. I'd just avoid having the card take up too much of your time and thought. (Disclaimer - I've used and written about Credit Karma. I have no business relationship with them, my articles are to help readers, and not paid placement.) mhoran's response is in line with my thinking. His advice to use the card to build your score is what the zero-credit folk criticize as \"\"a great debt score.\"\" Nonsense. If you use debt wisely, you'll never pay interest (except for a mortgage, perhaps) and you may gain rewards with no cost to you.\"" }, { "docid": "12787", "title": "", "text": "There is no law requiring someone to return a refused check. You need to clarify whether this payment is to establish a retainer, or to pay for services rendered. Either way you should stop payment on the check and send them a certified letter explaining that you are stopping payment on the check because they refused it. If the payment is to establish a retainer, then the issue is simple: the lawyer requires $10,000 as a retainer before you can engage them and until then you have no relationship with them. If that is the amount they want, then less than that is not accepted. If the payment is for services rendered already and you owe them money, then it is a completely different situation. Refusing partial payment means they are getting ready to sue you. In a collection suit, the larger the amount is, the better. Normally, someone owed money will only refuse a partial payment if they anticipate having to sue the debtor and they want to maximize their leverage in case of a court judgement in their favor. A creditor has the right to refuse a partial payment." }, { "docid": "275249", "title": "", "text": "\"There are three (or four) ways that a company can grow: (Crowdfunding is a relatively new (in mainstream businesses) alternative financing method where people will finance a company with the expectation that they will benefit from the product or service that they provide.) Obviously a startup has no prior income to use, so it must either raise money through equity or debt. People say that one must borrow contingent on their salary. Banks lend money based on the ability to pay the loan back plus interest. For individuals, their income is their primary source of cash flow, so, yes, it is usually the determining factor in getting a loan. For a business the key factor is future cash flows. So a business will borrow money, say, to buy a new asset (like a factory) that will be used to generate cash flows in the future so that they can pay down the debt. If the bank believes that the use of the money is going to be profitable enough that they will get their money back with interest, they'll loan the money. Equity investors are essentially the same, but since they don't get a guaranteed payback (they only get paid through non-guaranteed dividends or liquidation), their risk is higher and they are looking for higher expected returns. So the question I'd have as a bank or equity investor is \"\"what are you going to do with the money?\"\" What is your business strategy? What are you going to do that will make profits in the future? Do you have a special idea or skill that you can turn into a profitable business? (Crowdfunding would be similar - people are willing to give you money based on either the social or personal benefit of some product or service.) So any business either starts small and grows over time (which is how the vast majority of businesses grow), or has some special idea, asset, skill, or something that would make a bank willing to take a risk on a huge loan. I know, again, that people here tend to turn blind eyes on unfortunate realities, but people do make giant businesses without having giant incomes. The \"\"unfortunate reality\"\" is that most startups fail. Which may sound bad, but also keep in mind that most startups are created by people that are OK with failing. They are people that are willing to fail 9 times with the thought that the 10th one will take off and make up for the losses of the first 9. So I would say - if you have some great idea or skill and a viable strategy and plan to take it to market, then GO FOR IT. You don't need a huge salary to start off. You need something that you can take to market and make money. Most people (myself included) either do not have that idea or skill to go out on their own, or don't have the courage to take that kind of risk. But don't go in assuming all you need is a loan and you'll be an instant millionaire. You might, but the odds are very long.\"" }, { "docid": "454526", "title": "", "text": "There is a fundemental misunderstanding: the business and the owner are not the same entity. You said: I give the business $25,000 and take 50% of the business. No you can give the owner of the business 25K, and now he has 25K and 50% of a 50K business. That 25K sits in Mr. Smith's bank account, not Acme Widget's account. A more simple example is when you buy a car. The money goes to the car dealership, it does not get put into the car's glove box. You may be thinking of an investor in a business. He could pump $$ into the business as operating capital for a share of the business. In that case, it would be a bit unfair to get 50% of the business for a 25K. However, the owner may be interested in doing such a deal because value of the investor can add more than just $$ to the business. Having a celebrity investor might do more good for the business than the actual dollars. Another situation is that the owner might be desperate. Without a influx of cash the whole business might end. There are guidelines to business evaluation, but valuing them is not an easy thing." }, { "docid": "526260", "title": "", "text": "Brokerages are supposed to keep your money separate from theirs. So, even if they fail as a company, your money and investments are still there, and can be transferred to another brokerage. It doesn't matter if it's an IRA or taxable account. Of course, as is the case with MF Global, if illegally take their client's money (i.e., steal), it may be a different story. In such cases, SIPC covers up to $500K, of which $250K can be cash, as JoeTaxpayer said. You may be interested in the following news item from the SEC. It's about some proposed changes, but to frame the proposal they lay out the way it is now: http://www.sec.gov/news/press/2011/2011-128.htm The most relevant quote: The Customer Protection Rule (Rule 15c3-3). This SEC rule requires a broker-dealer to segregate customer securities and cash from the firm’s proprietary business activities. If the broker-dealer fails, these customer assets should be readily available to be returned to customers." }, { "docid": "366561", "title": "", "text": "Some businesses sell a franchise. You will be buying the name and reputation, access to the corporate infrastructure, requirements to use specific supplies and procedures. These tend to come with financing from the parent company. You will need to bring cash to the table, but they will loan you the rest. When purchasing a business, like buying a house, what is part of the deal can be negotiated. Sometimes the new owner and the seller agree to transfer everything. In other cases almost nothing except one item is included. The one item could be the location, the name, the inventory, the customer/client list. All these can be assets or liabilities depending on the specific situation, and which side of the table you are on. In the United states the US government has the Small Business Administration. They also have Small Business Development Centers SMDC to help. These are also supported by state governments and colleges and universities. They can help identify the steps needed to start a small business." }, { "docid": "260956", "title": "", "text": "I'd be very surprised (but feel free to prove me wrong) if he advised people to pay in physical cash. He probably means to not take out debt. In the world of M&amp;A, the term cash is used a bit differently. You can fund a deal with cash, stock, or a combination of both. However, there are different sources of cash. You can have funds in your bank account, or you can go borrow funds in the debt market. So what this means for this deal is that AMZN shareholders will not be giving up any equity for the acquisition. They will either use cash that is in their bank accounts or go to the debt markets, raise debt, and use the proceeds to pay WFM shareholders. No one shows up with physical cash in either case. It's wired over to the people who will then distribute the money to the shareholders." }, { "docid": "395995", "title": "", "text": "\"Understood. But based on the OP, it's not categorically clear what they were refusing. If they refused to quote the balance and/or refused to take a phone payment that was otherwise in keeping with the cardholder agreement (i.e., the cardmember called the correct number for phone payments and balance-checking, etc), then yeah, they were not only being unreasonable, but also violating the contract. What I read as ambiguous is whether the cardholder was specifically asking for the *payoff* balance/amount, and whether they were following process for phone-payments and balance-checking, etc. IOW, it's not necessarily \"\"illegal\"\" and might not even be unreasonable for the customer-service number to have different departments for balance-checking and phone-payments versus card-cancellation. It's not falsifiably clear from the OP that the cardholder was not asking the person on the other end of the phone for categorical statements of fact that they were obligated to make. I'm not accusing anyone of lying or saying that the CC company was acting reasonably, I'm just saying that language such as **\"\"They do not provide mid-cycle payoff quotes\"\"** is not evidence that they were doing any kind of funny-business.\"" }, { "docid": "313158", "title": "", "text": "\"There will be no police involved. The police do not care. Only the feds care, and they only care about large amounts (over $100,000). What will happen is that the teller will deposit the money like nothing is unusual, but the amount will trigger a \"\"Suspicious Transaction Report\"\" to be filed by the bank. This information goes to the US Treasury and is then circulated by the Treasury to basically every agency in the government: the Department of Defense, the FBI, the NSA, the CIA, the DEA, the IRS, etc. What happens next depends on your relationship with your bank and the personality of the bank. In my case I have made large cash transactions at two different banks, one that I had a long relationship with, and another that I had a long-standing but dormant account. The long-term one was a high end savings bank in a city. The dormant one was one of those bozo retail banks (think \"\"Citizens\"\" or \"\"Bank of America\"\") in a suburb. The long-term bank ignored my first deposit, but after I made some more including one over $50,000 in cash they summoned me via a letter. I went in, talked to the branch manager and explained why I was making the deposits. He said \"\"That sounds plausible.\"\" and that was the end of the interview. It is unlikely that they transferred the information. They probably just wrote it down. They did this because they have \"\"know your customer\"\" regulations and they wanted to be able to prove that they did \"\"due diligence\"\" in case anybody asked about it later. The suburban bank never asked any questions, but they did file the STRs. In general, there is no way to know if the bank will interview you or not. It depends on a lot of different factors. The basic factors are: how much money is it, are you doing a lot of business normally, and how well does the bank know you. If you refuse to answer the bank's questions to their satisfaction, it is a 100% chance that they will close your account. They can also file higher level reports that flag your activity as \"\"highly suspicious\"\" as opposed to just the normal \"\"suspicious\"\". As long as it is a bank employee, you should have no serious concerns unless the guy seems strange and asks really pointed questions. If you have any question whether the \"\"employee\"\" is legitimate, just verify that he/she is a bank employee. Obviously if the feds visit you, you should say nothing. The chance of this happening is 1 in a million.\"" }, { "docid": "315158", "title": "", "text": "I maintain a strong bias against taking on any debt, of any sort, and I feel it serves me well. This is not to say I would never take on a debt, like a car loan, mortgage, or educational loan. It's just that there is a built in bias against it. The reason that bias is good is that, in my view, taking on (unforced) debt presents the following problems: Therefore, the standing no-debt bias. That said, if there is a very compelling reason to take on unforced debt, it could override the bias. The best example I know is that my mother bought a house with a mortgage when she had the cash, because CDs at that time were paying far more than the mortgage interest rate (this was back around the 80s when CDs hit an absurd 18%!). To not take on that debt would be refusing free money! But that's a rare case. Today, CDs and other guaranteed interest streams are at historical lows, so this factor is really not in play." }, { "docid": "172567", "title": "", "text": "\"ACH transfers are the evolution of paper check clearing houses. Transactions are conducted in bulk and do not immediately settle -- the drawer and drawee still retain liability for a period of days or weeks after the transaction date. (I'd suggest looking to the legal definition of a check or draft to understand this better.) A for-fee wire transfer still goes through an intermediary, but settle immediately and irrevocably. Wire transfers are analogous to handing cash to someone. In the US, the various Federal Reserve banks are involved because they are the central banks of the the United States. In the past, bank panics were started or exacerbated when banks would refuse to honor drafts drawn on other banks of questionable stability. Imagine what would happen today if your electric company refused to accept Bank of America or Citibank's check/ACH transactions? Wouldn't you get withdraw every penny you could from BoA? During the 1907 banking panic, many solvent banks collapsed when the system of bank \"\"subscriptions\"\" (ie. arrangements where small town banks would \"\"subscribe\"\" to large commercial banks for check clearing, etc) broke down. Farmers, small business people and individuals lost everything, all because the larger banks would not (or could not) risk holding drafts/checks from the smaller banks.\"" }, { "docid": "248697", "title": "", "text": "Maybe there's more to this story, because as written, your sister seems, well, a little irrational. Is it possible that the bank will try to cheat you and demand that you pay a loan again that you've already paid off? Or maybe not deliberately cheat you, but make a mistake and lose track of the fact that you paid? Sure, it's POSSIBLE. But if you're going to agonize about that, what about all the other possible ways that someone could cheat you? What if you go to a store, hand over your cash for the purchase, and then the clerk insists that you never gave him any cash? What if you buy a car and it turns out to be stolen? What if you buy insurance and when you have a claim the insurance company refuses to pay? What if someone you've never met or even heard of before suddenly claims that you are the father of her baby and demands child support? Etc etc. Realistically, banks are fanatical about record-keeping. Their business is pretty much all about record-keeping. Mistakes like this are very rare. And a big business like a bank is unlikely to blatantly cheat you. They can and do make millions of dollars legally. Why should they break the law and risk paying huge fines and going to prison for a few hundred dollars? They may give you a lousy deal, like charge you outrageous overdraft fees and pay piddling interest on your deposit, but they're not going to lie about how much you owe. They just don't. I suggest that you not live your life in fear of all the might-be's. Take reasonable steps to protect yourself and get on with it. Read contracts before you sign, even if the other person gets impatient while you sit there reading. ESPECIALLY if the other person insists that you sign without reading. When you pay off a loan, you should get a piece of paper from the bank saying the loan has been paid. Stuff this piece of paper in a filing cabinet and keep it for years and years. Get a copy of your credit report periodically and make sure that there are no errors on it, like incorrect loan balances. I check mine once every year or two. Some people advise checking it every couple of months. It all depends how nervous you are and how much time you want to spend on it. Then get on with your life. Has your sister had some bad experience with loans in the past? Or has she never borrowed money and she's just confused about how it works? That's why I wonder if there's more to the story, if there's some basis for her fears." }, { "docid": "488258", "title": "", "text": "A Lease is an entirely different way of getting a car. In two situations it makes sense, in all other scenarios it generally doesn't make sense to lease. In the case of always wanting a new car every 2 or 3 years it can make sense to lease. Of course if you drive more the allowed miles you will pay extra at the end of the lease. If you can take the monthly lease as a business expense leasing makes sense. Otherwise you want to pay cash, or get financing. Does zero percent make sense? Sometimes. The only way to make sense of the numbers is to start with your bank, have them approve of the loan first. Then armed with the maximum loan amount they will give you and the rate and the length of the loan, then visit the dealer. You have to run the numbers for your situation. It depends on your income, your other expenses, your credit score, your bank, what deal the dealership is running, how much you have for a down payment. Here is an example. For a recent loan situation I saw: 36 months, 1.49% rate, 20K loan, total interest paid: ~$466. Armed with that information can the person get a better deal at the dealership? There was only one way to find out. In that case the credit union was better. The rebate was larger than the interest paid." }, { "docid": "125422", "title": "", "text": "If this is because he wants to avoid paying taxes, will I get in trouble if I agree to have him work on my vehicle? You should check your state and local sales tax laws to be certain, but in my state you have no liability if he does not pay his taxes. That's his problem, not yours. The biggest risk for you is if something goes wrong, you have no proof that the work was ever done, so it's possible he could deny that any transaction ever took place and refuse to correct it or refund your money. So at worst you're out what you paid for the service, plus what it would cost you to fix it if you needed to and chose to do so. If you don't want to take that risk, then insist on a receipt or take you business elsewhere, but there's no criminal liability for you if he chooses not to report the income. EDIT Be aware, though that state tax is levied at the state and local level, so the laws of your individual state or city may be different." }, { "docid": "20328", "title": "", "text": "\"You should definitely read through that contract front to back multiple times, making sure you understand every word. Voice your concern to the gym. Explain why you feel you're being cheated. Best case: they waive the fee. Worse case: you leave bad reviews all over social media, explaining the \"\"surprise fee\"\" practice, and *then* they waive the fee. Very worst case: The gym refuses to waive the fee, you threaten legal action. They're probably going to waive the fee then. I don't forsee any circumstance where you actually have to take them to court. I'd ask /r/legaladvice for sure.\"" }, { "docid": "536497", "title": "", "text": "\"Banks are businesses, and as such should have the right to refuse service, so they should probably be able to choose one customer over another at will. [I say \"\"should\"\" because business owners protecting themselves against litigation related to discrimination could restrict their freedom as business owners.] However, banks are businesses and if the customers are identical, both will be approved (or not) according to credit records. Does not make sense to approve one person with a given credit record and refuse someone with a similar record. Unless they barely qualify. Since no two credit histories are identical, there are surely edge cases. Finally, if a customer is a long term customer with large deposits and/or significant amounts of business with the bank, the bankers will likely be inclined to do more business.\"" }, { "docid": "88972", "title": "", "text": "\"The key with analyzing financial statements is that you need to look at all angles of a particular item. ie: Sales has gone up, but has the cost of sales increased by even more, implying narrower margins? Or, interest expense has gone up, but is that because new debt was taken on to pay for expansion? In the specific case you mentioned [buying assets that will create depreciation expense over time], there is a grouping on the cash flow statement called 'Investing', which will state the amount of cash used during the year to invest in the business. This could be a good thing or a bad thing, depending on other factors (and your personal preference regarding dividends being paid to shareholders). In addition, you can see the amount of depreciation expense separately listed on the cash flow statement. This tells you many things. Consider a company with $10M in assets on the balance sheet, but $2M in depreciation expense. This tells you that [in a very loose sense], every 5 years the assets owned by the company will all need to be replaced. Compare that with the Investing section of the cash flow statement - if they are buying $4M of new assets this year, this tells you that on an overall basis, they are likely expanding the business, because the new investments outpace the depreciation. But, is your concern of under-reported earnings a common issue? Typically, keep in mind that the most common bias of a company is to over-report earnings. This is because management compensation (in the form of performance bonuses and stock option valuation) is increased by profitable years. However, in a year where a loss / poor performance is likely, a reverse-bias occurs, to take as much of a loss as possible in that year. This is because if a manager's bonus is already 0 due to poor company performance, having a worse year will not turn the bonus negative. So, by taking all expenses possible today on the financial statements, next year might have less allocated expenses, and therefore the manager might get a bigger bonus impact next year. This is called \"\"Taking a big bath\"\". Note that public companies must meet certain reporting standards, and they are audited by external accounting firms to show that they meet those standards. Of course, there is no guarantee that the auditors will catch all cases of accounting manipulation (see Enron, etc., etc.).\"" }, { "docid": "222086", "title": "", "text": "\"Legal tender is by law any denominations of money printed by the Bank of Canada. There is an exclusion to this in that it must also be acceptable to both parties of the transaction. See the following link from the Bank of Canada on Legal Tender and look at the answer to the question of What is \"\"legal tender\"\"? The reason retailers may refuse the \"\"legal tender\"\" is in the case of counterfeit prevention. The stores that purchase the scanning machines are trying to be accommodating by deferring the decision to refuse the \"\"legal tender\"\" after verifying it (checking if it is acceptable).\"" }, { "docid": "376797", "title": "", "text": "When you're selling something through a provider, like Craig's List or newspapers, the only thing that may limit your choices is the provider. They may refuse your post if it's against their rules or the law. But luckily they usually don't limit or enforce certain payment choices. These private business providers have the right to do so if they want. You don't need to be their customer. They may state their terms for using the service and even refuse service (before any payment is made). The fun part is that you may do so as well. Just remember to state your terms in your post so the prospective buyers are aware of them. I've found it best to put payment and delivery terms in separate lines so that they are easily noticeable, for example: Nice victorian handbasket with gold embroidery, only used once. Signed by the original author. Comes with a certificate of authenticity. No delivery, only cash payments." } ]

[ { "docid": "153679", "title": "", "text": "\"A business can refuse cash (paper currency) payment pretty much in all cases provided it's a reasonable policy and/or notified during/in advance of contracting. Details in this link. \"\"all United States money as identified above are a valid and legal offer of payment for debts when tendered to a creditor. There is, however, no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services.\"\" Even if the payment is being made to settle a debt or other obligation, the creditor may refuse payment if their rationale is reasonable (as determined by the courts).\"" } ]

[ { "docid": "125422", "title": "", "text": "If this is because he wants to avoid paying taxes, will I get in trouble if I agree to have him work on my vehicle? You should check your state and local sales tax laws to be certain, but in my state you have no liability if he does not pay his taxes. That's his problem, not yours. The biggest risk for you is if something goes wrong, you have no proof that the work was ever done, so it's possible he could deny that any transaction ever took place and refuse to correct it or refund your money. So at worst you're out what you paid for the service, plus what it would cost you to fix it if you needed to and chose to do so. If you don't want to take that risk, then insist on a receipt or take you business elsewhere, but there's no criminal liability for you if he chooses not to report the income. EDIT Be aware, though that state tax is levied at the state and local level, so the laws of your individual state or city may be different." }, { "docid": "61319", "title": "", "text": "We live in a community, and as citizens we all have the right to shop in public shops and eat in public restaurants. If that right is abridged, then freedom is abridged. And the freedom to enjoy the public services of one's community is far more important than the freedom to deny services due to one's prejudice. Either way someone loses a bit of freedom. Which is more important? According to you the freedom to do what you will with your property outweighs any and all possible consequences of exercising that freedom. This is a very extreme viewpoint. I know because I once held it. &gt;Go start a business and get back to us Yeah I did that. 15 years ago and still going. And I actually hire people. You may not want to make too many assumptions about the person you are debating. As a business owner I would happily choose a world in which I had to hire the best qualified candidate regardless of my prejudices over one in which other business owners could arbitrarily refuse me services that are offered to the general public just because of who I am. &gt;If a person is refused service for any reason, they can find another store, shop, or vendor. And what if all the stores in your town have similar policies? Am I to drive to the next town every time I need to go shopping? What if all the shops within 1000 miles have discriminatory policies? How am I to live? The only reason you can make this argument is because of the success of the civil rights act. If it was repealed today you would likely be able to avoid racist restaurants and shops by going elsewhere. If it had never existed that would not be the case. &gt;THERE IS NO EQUAL OPPORTUNITY IN LIFE FOR SUCCESS That is why I very specifically said that all citizens must have a REALISTIC opportunity for success, and NOT that there should be EQUAL opportunity (impossible) or equal outcomes (ridiculous and counter-productive). What must be avoided is the creation of an economic status quo that ensures the poor remain poor and the rich remain rich. Such a status quo is just slavery without the whips. Even if the government is not enforcing the status quo, it can be just as hard to break free from. &gt;Forceful acts by government are ALWAYS far worse than forceful acts in the private sector It is the results of the act of force that matters, not its source or methodology. This once again is an argument from pure ideology. Because you believe that government force is always worse than the private sector, you are unable to see examples of how the private sector can limit our freedoms in even worse ways. Simply stating that government acts of force are always worse does not prove it so. &gt;that's exactly where your collectivist sewer leads I would argue that the centers of poverty you listed are much more a symptom of the systematic undercutting of education, social services and other support systems that once gave the underprivileged a realistic way to improve their lot in life. Now, with blue-collar wages on the decline and public education gutted, poverty gets more entrenched and harder to overcome. You really think it's going to get better for these people if we take away the minimum wage? Do away with public schools? Food stamps? Medicaid? Is there any point at which lack of social mobility becomes a more damaging than minor economic regulations? Is it OK to effectively return to the feudal system if it means nobody will ever have one penny taxed from them and given to someone who wasn't born rich? Nobody made you get born poor so there's no force and therefore everything is right and good? Such a shallow view of our moral obligations as members of a society. We live in a society. Extreme individualism will lead only to self-destruction just as fast as extreme collectivism. The only rational view is to analyze the facts, weigh the benefits and consequences to any given policy, and make decisions without any preconceived notion of what the solution should look like. In the case at hand, I, and the vast majority of people, think the minor inconvenience of not being able to make discriminatory hiring decisions is far outweighted by the benefits of not having large segments of the population chronically unemployed and impoverished because their race. The only effective argument against this would be to posit a way in which the benefits of this policy could be achieved (or bettered) without the use of government coercion, and that I haven't seen. &gt;You'd better grow up fast on this one Remember, you are talking to someone who thought and argued exactly the same viewpoint you are now espousing for 10 years. I was even a delegate to the national Libertarian convention once. I was a true believer. I did grow up." }, { "docid": "172567", "title": "", "text": "\"ACH transfers are the evolution of paper check clearing houses. Transactions are conducted in bulk and do not immediately settle -- the drawer and drawee still retain liability for a period of days or weeks after the transaction date. (I'd suggest looking to the legal definition of a check or draft to understand this better.) A for-fee wire transfer still goes through an intermediary, but settle immediately and irrevocably. Wire transfers are analogous to handing cash to someone. In the US, the various Federal Reserve banks are involved because they are the central banks of the the United States. In the past, bank panics were started or exacerbated when banks would refuse to honor drafts drawn on other banks of questionable stability. Imagine what would happen today if your electric company refused to accept Bank of America or Citibank's check/ACH transactions? Wouldn't you get withdraw every penny you could from BoA? During the 1907 banking panic, many solvent banks collapsed when the system of bank \"\"subscriptions\"\" (ie. arrangements where small town banks would \"\"subscribe\"\" to large commercial banks for check clearing, etc) broke down. Farmers, small business people and individuals lost everything, all because the larger banks would not (or could not) risk holding drafts/checks from the smaller banks.\"" }, { "docid": "29849", "title": "", "text": "I just listened to a podcast on this topic this week, and Satanicpuppy is pretty much correct. If you are interested, here is a link to the podcast on Legal Lad: Can Businesses Refuse to Accept Cash?" }, { "docid": "451328", "title": "", "text": "Please don't waste any more time feeling bad for merchants for the charges they incur. I don't know who supported the lobby for this rule, but issuers no longer can demand that merchants accept all transactions (even the unprofitable ones). I discussed this at length on my blog. Merchants accept credit cards for one reason, and one reason only: it brings them more business. More people will buy, and on average they'll buy more. They used to take the occasional hit for someone buying a pack of gum with a credit card, but they don't have to anymore. The new law restricts issuers from imposing minimum transactions that are less than $10. I use a rewards card wherever possible. I get a cheaper price. In most cases I don't care what the merchant has to pay. They've already factored it into their prices. But if you are concerned, then as fennec points out in his comment, cash is the way to go." }, { "docid": "222086", "title": "", "text": "\"Legal tender is by law any denominations of money printed by the Bank of Canada. There is an exclusion to this in that it must also be acceptable to both parties of the transaction. See the following link from the Bank of Canada on Legal Tender and look at the answer to the question of What is \"\"legal tender\"\"? The reason retailers may refuse the \"\"legal tender\"\" is in the case of counterfeit prevention. The stores that purchase the scanning machines are trying to be accommodating by deferring the decision to refuse the \"\"legal tender\"\" after verifying it (checking if it is acceptable).\"" }, { "docid": "260956", "title": "", "text": "I'd be very surprised (but feel free to prove me wrong) if he advised people to pay in physical cash. He probably means to not take out debt. In the world of M&amp;A, the term cash is used a bit differently. You can fund a deal with cash, stock, or a combination of both. However, there are different sources of cash. You can have funds in your bank account, or you can go borrow funds in the debt market. So what this means for this deal is that AMZN shareholders will not be giving up any equity for the acquisition. They will either use cash that is in their bank accounts or go to the debt markets, raise debt, and use the proceeds to pay WFM shareholders. No one shows up with physical cash in either case. It's wired over to the people who will then distribute the money to the shareholders." }, { "docid": "14989", "title": "", "text": "I know this is heresy but if you have funds for significantly more than 6 months of expenses (let's say 12 months), how risky would it be to put it all into stock index funds? Quite risky as if you do need to dip into it, how fast could you get the cash? Also, do you realize the tax implications when you do sell the shares should you have an emergency? In the worst-case scenario, let's say you have a financial emergency at the same time the stock market crashes and loses half its value. You could still liquidate the rest and have sufficient funds for 6 months. Am I underestimating the risks of this strategy? That's not worst case scenario though. Worst case scenario would be another 9/11 where the markets are closed for nearly a week and you need the money but can't get the funds converted to cash in the bank that you can use. This is in addition to the potential wait for a settlement in the case of using ETFs if you choose to go that way. In the case of money market funds, CDs and other near cash equivalents these can be accessed relatively easily which is part of the point. A staggered approach where some cash is kept in house, some in accounts that can easily accessed and some in other investments may make sense though the breakdown would differ depending on how much risk people are willing to take. If it truly is an emergency fund then the odds of needing it should be very slim, so why live with near zero return on that money? Something to consider is what is called an emergency here? For some people a sudden $1,000 bill to fix their car that just broke down is an emergency. For others, there could be emergency trips to visit family that may have gotten into accidents or gotten a diagnosis that they may pass away soon. Consider what do you want to call an emergency here as chances are you may not be considering all that people would think is an emergency. There is the question of what other sources of money do you have to cover should issues arise." }, { "docid": "365648", "title": "", "text": "\"In addition to Alex B's excellent overview, I'd like to add a few more bits of advice. First of all, one term you should know is \"\"commercial real estate\"\" - which is precisely what this is. There is a business element, but it is strictly (and almost entirely) intertwined to the underlying real estate, which makes this a special category of business which is generally considered simply \"\"commercial real estate\"\" (just like office buildings, shopping malls, etc). All real estate and businesses value are based on alternatives - what other options are there? In appraisal, these are generally called \"\"comparables\"\". A professional appraiser is generally available for commercial real estate of this type. While a full, official commercial appraisal can run into the thousands, many/most (all?) appraisers are willing to sell you a simplified version of their service, which can be called a \"\"letter of opinion\"\" and can help you get an idea for the market price (what other similar commercial properties are running for). A loan company would strictly require this, but if you are thinking of an all cash or form of seller-financing this would technically be optional. Your best bet is to read about some of what is involved in commercial real estate appraisal and evaluation, and you may even want to speak with commercial loan officers - even if you don't know that you want to get a loan to acquire the property! It's their job to help inform you about what is required and what they look for, so they can be a potential resource beyond your own research as well. With this said, the only way to estimate value (and, conveniently, the best way) is to look at other properties! And by \"\"others\"\", I mean that you should really not consider buying absolutely anything until you've viewed at least 6-10 other options in some depth - and you probably want to double or triple that number if you are looking to make this the last big business transaction of your life. If you don't you'll be relying on little more than dumb luck to carry you through - which in this area of business, you don't want to do because the dollar amounts and liabilities involved can bankrupt you in no time flat. With that general advice out of the way, here's a tiny nutshell version of valuation of commercial real estate. There are a few key parts involved in commercial real estate: land, improvements (buildings, docks, stuff like that), income, and wages. Land: the value of the land is based upon what you could sell it for, as-is. That is to say - who else might want it? This alone has many important factors, such as zoning laws, the neighborhood (including your neighbors), water/utilities, pacts on the land (someone may have insisted the land not be paved into a parking lot, or really anything like that), alternative uses (could you put a golf course on it, or is the land suitable for a big building or farming?), etc. And is this in a growing area, where you might hope the value will increase over the next decade, or decrease, or basically stay flat (and possibly cause losses compared to inflation)? Improvements: anything on the land is both an asset and a liability. It's an asset because it could add to the value of the land, but it might also reduce the land value if it interferes with alternate land uses. It's a liability, both in the legal sense and in that it requires maintenance. If you want to rent them out, especially, that means concern about any foundations involved, termites, roofs, sewage/septic tanks, utilities that are your responsibility (pipes, poles, wires), as well as any sort of ac/heating you may have, docks, and so on. These things are rarely free and absolutely can eat you alive. Income: Ah, the best part, the constant influx of cash! But wait, is it a constant influx? Some businesses are purely seasonal (summer only, winter only), some are year-round but have peak times, and others don't really have a \"\"peak\"\" to speak of. If you are renting, are there issues collecting, or with people over-staying? How about damage, making a mess, getting rowdy and disturbing others? Regardless, there is obviously some income, and this is usually the most dangerous part of the equation. I say \"\"dangerous\"\", because people absolutely lie like dogs on this part, all the time. It's easy to cook the books, assuming they even attempt to keep proper books in the first place! Businesses of this form often have a lot of cash business that's easy to hide (from Uncle Sam, or sometimes even the owners themselves if there are employees involved) - and fake! And some people are just shoddy bookkeepers and the info is just wrong. But, there will clearly be some kind of yearly income involved. What does this matter? Well...how much is there? How much is tied to the owners (personal friends do business and they will leave if the ownership/management changes)? In commercial real estate the income will be calculated for a fiscal year, and then there is something called a \"\"multiple\"\", which is market dependent. Let's say the whole place takes in $100k in rent a year. As part of buying this business, you are buying not just assets, but expected future income. In some commercial areas the multiple is as little as .5 to 2 - which means that the going rate is about 6-24 months worth of income, as part of the purchase price. So with 100k rent a year, that means 50k-200k of the purchase price is attributable to the income of the business. And if business is half of what you thought it would be? That means the net value of the whole enterprise decreases by 25k-100k - on top of the reduced income every year you own it! Income provides cash flow, which should pay all the expenses (cleaning up from wind storms, replacing windows that are broken, hauling off trash, replacing a well that ran dry), and then the extra that remains is positive cash flow. If you take out a loan, then ideally the cash flow would also pay that completely so long as you don't have any big unexpected expenses in the year - and still have some left over for yourself. Wages: Well, that money doesn't collect itself! There's sales, keeping the books, collecting the rent, performing maintenance, customer service, cleaning, paying the bills, keeping the insurance people happy, handling emergencies, and everything else involved with running the business. Someone is going to do it, and the biggest error people make here is not to put any value on their time - and to make it so they can never afford to take a vacation again! Pay yourself, and give yourself the flexibility to pay others when you can't (or don't want) to do it all yourselves. So, what's the point of all this? How do you actually make any money? In two ways: 1) selling the whole thing later, and 2) cash flow. For 1, it's important that you not be in a situation where you are betting that in the future there will be a \"\"person richer, and dumber, than I am now\"\". If the current owner wanted 2 million, then 1 mil, then less, over multiple years...this suggests either he is delusional about the value of his place (and most property owners are), or that its actually hard to find a buyer for such a business. You are going to want to make sure you understand why that is, because most of the value of real estate is...well, in the real estate itself! For 2, you need cash coming in that's considerably more than the cost of running the place. Also, cash flow can strongly change the value of the business for resale (depending on the multiple, this can make a huge difference or prevent you from selling the thing at all). You mentioned you want to put in more cabins, more marketing/sales efforts, etc. That's great, but first, that would mean added investment beyond the purchase price. Is it legally and physically practical to add more cabins, and what is their current utilization rate? If they are only renting 10% of their current capacity, increasing capacity may be premature. This will also vary through the year, so you may find there is a problem with being sold out sometimes...but only for a small percentage of the time. Which means you'll be adding buildings only to have them used for a fraction of the year, which will be very hard to make a profit from. If cash flow is good, ideally even being enough to cover a loan payment to help cover the purchase price (and remember that commercial real estate loans are much smaller loan-to-value ratios than in residential real estate), there is one final barrier to making money: the damn non-regular maintenance! Roofs, wells, and wooden walls all have a sad tendency to cost you nothing right up until the point they cost you $30k+ on a single day. Is there enough cash flow to make these sort of certainties (and if you plan to be there for years, they are a certainty) not put you in the poor house? This was rather long, but I hope this overview helps you appreciate all that you'll need to look into and be cautious of during your future en-devour! Commercial real estate is generally costly and high-risk, but also can be high reward. You'll need to compare many opportunities before you can get a \"\"feel\"\" for what is a good deal and what is a terrible one. You'll need to consider many factors, such as resale value and cash flow/income (which they will have to tell you and you can assume is not true, due to ignorance or malice), as well as maintenance and liabilities, before you can begin to really estimate the value of an enterprise of this sort. There are people who can help you, like appraisers and commercial brokers, but ultimately you'll need to do a lot of research and comparisons yourself to help you make a good decision. Finally, there is no very simple method for evaluating commercial real estate value. You need a variety of information, and you must be skeptical of what you are told because of the very large sums of money involved. It is doable (lots of people do it), but you must take care and do your due diligence so you don't get bankrupted by a single bad purchase.\"" }, { "docid": "12787", "title": "", "text": "There is no law requiring someone to return a refused check. You need to clarify whether this payment is to establish a retainer, or to pay for services rendered. Either way you should stop payment on the check and send them a certified letter explaining that you are stopping payment on the check because they refused it. If the payment is to establish a retainer, then the issue is simple: the lawyer requires $10,000 as a retainer before you can engage them and until then you have no relationship with them. If that is the amount they want, then less than that is not accepted. If the payment is for services rendered already and you owe them money, then it is a completely different situation. Refusing partial payment means they are getting ready to sue you. In a collection suit, the larger the amount is, the better. Normally, someone owed money will only refuse a partial payment if they anticipate having to sue the debtor and they want to maximize their leverage in case of a court judgement in their favor. A creditor has the right to refuse a partial payment." }, { "docid": "409717", "title": "", "text": "I have to ask: At what point do people take into account their own financial responsibility when it comes to these fees? Don't get me wrong, I've been in that overdraft fee loop before and it was brutal so I took my business else where... what I didn't realize at the time was that I did exactly what the bank wanted me to do. Either pay up for the bank forwarding money on my behalf, or gtfo. Banks aren't obligated to do shit with our pennies. By asking them to hold on to our cash, they provide a service including all the attached fine print. Trickery is obviously foul play, but so is constantly over-drawing an account. One or two overdraws should be red flag enough that you're not paying attention to your money. But this isn't the case for our culture. We get penalized then act like victims." }, { "docid": "14317", "title": "", "text": "There is no common sense in Michigan and money does reveal character. Take a Michigan based business for example of more outrageous behavior that our State reps overlook. Frankenmuth Insurance company located in Frankenmuth Michigan purports in its commitment statement to policyholders to: Frankenmuth Insurance built a solid foundation adhering to its fundamental principles of honesty, integrity, unsurpassed customer service and conservative business practices. With much emphasis on Corporate Governance and common sense, this company located in Frankenmuth Michigan regularly violates its own commitment to policyholders by engaging in egregious conflicts of interest with board members that not only lack integrity, but are of blatant poor judgment for personal gain and detrimental to policyholders. The only policyholders invited to their annual policyholder meetings are employees and retirees of the company so that no one will vote against or challenge their elections. The board members are taken on annual trips with their spouses the week of the annual board meeting wherein on the last day, they (the board) are asked to vote on executive pay and bonuses. After a week of being wined and dined at exclusive resorts such as the One and Only Palmilla in Cabo and the Winn in Vegas the Frankenmuth executives know that the board will give them exorbitant raises and bonuses which is information they again refuse to disclose because of the public outrage their behavior would cause, adversely impacting their business. Getting what they want from the board afforded CEO Stanton a 12,000 sq foot retirement home newly constructed on a 1 million dollar plot of land at Bay Harbor overlooking Lake Michigan. One trip that Frankenmuth executives took 90 people on (those people were executives and spouses and agents and spouses) cost 5 million dollars for one week. That translates to about $53K per person. Bill Schutte pretends to care about the taxpayers dollars and how they are spent yet he thus far has refused to require Frankenmuth to disclose it's egregious spending of lavish trips and entertainment and or investigate the clear conflicts of interest with its board that are costing the taxpayers of Michigan huge dollars in increased premiums. On top of all of this, Frankenmuth admittedly has a computer system that does not track its employees use of policyholder information meaning the public is not safe from potential identity theft nor is the company safe from internal theft. Frankenmuth uses credit reports to jack prices of policyholders up - someones credit has no bearing on their ability to drive and the executives are laughing all the way to the bank with the board in their pocket from canned elections." }, { "docid": "407505", "title": "", "text": "\"This answer will expand a bit on the theory. :) A company, as an entity, represents a pile of value. Some of that is business value (the revenue stream from their products) and some of that is assets (real estate, manufacturing equipment, a patent portfolio, etc). One of those assets is cash. If you own a share in the company, you own a share of all those assets, including the cash. In a theoretical sense, it doesn't really matter whether the company holds the cash instead of you. If the company adds an extra $1 billion to its assets, then people who buy and sell the company will think \"\"hey, there's an extra $1 billion of cash in that company; I should be willing to pay $1 billion / shares outstanding more per share to own it than I would otherwise.\"\" Granted, you may ultimately want to turn your ownership into cash, but you can do that by selling your shares to someone else. From a practical standpoint, though, the company doesn't benefit from holding that cash for a long time. Cash doesn't do much except sit in bank accounts and earn pathetically small amounts of interest, and if you wanted pathetic amounts of interests from your cash you wouldn't be owning shares in a company, you'd have it in a bank account yourself. Really, the company should do something with their cash. Usually that means investing it in their own business, to grow and expand that business, or to enhance profitability. Sometimes they may also purchase other companies, if they think they can turn a profit from the purchase. Sometimes there aren't a lot of good options for what to do with that money. In that case, the company should say, \"\"I can't effectively use this money in a way which will grow my business. You should go and invest it yourself, in whatever sort of business you think makes sense.\"\" That's when they pay a dividend. You'll see that a lot of the really big global companies are the ones paying dividends - places like Coca-Cola or Exxon-Mobil or what-have-you. They just can't put all their cash to good use, even after their growth plans. Many people who get dividends will invest them in the stock market again - possibly purchasing shares of the same company from someone else, or possibly purchasing shares of another company. It doesn't usually make a lot of sense for the company to invest in the stock market themselves, though. Investment expertise isn't really something most companies are known for, and because a company has multiple owners they may have differing investment needs and risk tolerance. For instance, if I had a bunch of money from the stock market I'd put it in some sort of growth stock because I'm twenty-something with a lot of savings and years to go before retirement. If I were close to retirement, though, I would want it in a more stable stock, or even in bonds. If I were retired I might even spend it directly. So the company should let all its owners choose, unless they have a good business reason not to. Sometimes companies will do share buy-backs instead of dividends, which pays money to people selling the company stock. The remaining owners benefit by reducing the number of shares outstanding, so they own more of what's left. They should only do this if they think the stock is at a fair price, or below a fair price, for the company: otherwise the remaining owners are essentially giving away cash. (This actually happens distressingly often.) On the other hand, if the company's stock is depressed but it subsequently does better than the rest of the market, then it is a very good investment. The one nice thing about share buy-backs in general is that they don't have any immediate tax implications for the company's owners: they simply own a stock which is now more valuable, and can sell it (and pay taxes on that sale) whenever they choose.\"" }, { "docid": "314691", "title": "", "text": "\"You should absolutely have a contract between you and your client stipulating the quid-pro-quos of the arrangement. They get the product, you get the money. First off, this contract should specify what you must do, and what they must do, for the contract to be \"\"satisfied\"\". This isn't necessarily just product for money; your client may be under deadlines to approve the product in various stages of work in process. Depending on the product, the client may be required to provide starting materials (like existing logos/slogans for advertising/marketing graphics), information on or access to computer systems (for software or infrastructure consulting, or accounting auditing), etc. Second, if you provide a tangible product like graphics or software, the contract should clearly state that \"\"intellectual property transfers on satisfaction of contract\"\"; they don't own what you have made until they have accepted it and paid you accordingly. If they try to stiff you by taking what you made them and using it before you've been paid, you can take them to the cleaner's for copyright violations. Third, you should structure a payment schedule; don't do too much for free. You can get the money in thirds, for instance; a third up front, a third at some defined halfway point and a third on final delivery and acceptance. Lastly, you should stipulate that the client is responsible for all expenses incurred by you as a result of their failure to pay as stipulated, up to and including attorney's fees. Definitely have a lawyer draft these agreements; contract law is a many-layered area of law with hundreds of years of case law and slightly different nuances in every state. A competent lawyer will know things that can and can't be stipulated in a contract, and if you try to do it alone you'll wish you hadn't when the contract's tossed out by a judge because of some technicality. If they refuse to pay, get the lawyer on the phone and file suit. A well-written contract drafted by a competent lawyer, which you have lived up to on your end, will give your client no loopholes to slip through. As far as recovering damages, it shouldn't matter whether he's in the U.S. or not; if he does business in the U.S. then he very probably has money in banks that have to listen to U.S. courts (or at least court orders).\"" }, { "docid": "366561", "title": "", "text": "Some businesses sell a franchise. You will be buying the name and reputation, access to the corporate infrastructure, requirements to use specific supplies and procedures. These tend to come with financing from the parent company. You will need to bring cash to the table, but they will loan you the rest. When purchasing a business, like buying a house, what is part of the deal can be negotiated. Sometimes the new owner and the seller agree to transfer everything. In other cases almost nothing except one item is included. The one item could be the location, the name, the inventory, the customer/client list. All these can be assets or liabilities depending on the specific situation, and which side of the table you are on. In the United states the US government has the Small Business Administration. They also have Small Business Development Centers SMDC to help. These are also supported by state governments and colleges and universities. They can help identify the steps needed to start a small business." }, { "docid": "434257", "title": "", "text": "\"Accounting for this properly is not a trivial matter, and you would be wise to pay a little extra to talk with a lawyer and/or CPA to ensure the precise wording. How best to structure such an arrangement will depend upon your particular jurisdiction, as this is not a federal matter - you need someone licensed to advise in your particular state at least. The law of real estate co-ownership (as defined on a deed) is not sufficient for the task you are asking of it - you need something more sophisticated. Family Partnership (we'll call it FP) is created (LLC, LLP, whatever). We'll say April + A-Husband gets 50%, and Sister gets 50% equity (how you should handle ownership with your husband is outside the scope of this answer, but you should probably talk it over with a lawyer and this will depend on your state!). A loan is taken out to buy the property, in this case with all partners personally guaranteeing the loan equally, but the loan is really being taken out by FP. The mortgage should probably show 100% ownership by FP, not by any of you individually - you will only be guaranteeing the loan, and your ownership is purely through the partnership. You and your husband put $20,000 into the partnership. The FP now lists a $20,000 liability to you, and a $20,000 asset in cash. FP buys the $320,000 house (increase assets) with a $300,000 mortgage (liability) and $20,000 cash (decrease assets). Equity in the partnership is $0 right now. The ownership at present is clear. You own 50% of $0, and your sister owns 50% of $0. Where'd your money go?! Simple - it's a liability of the partnership, so you and your husband are together owed $20,000 by the partnership before any equity exists. Everything balances nicely at this point. Note that you should account for paying closing costs the same as you considered the down payment - that money should be paid back to you before any is doled out as investment profit! Now, how do you handle mortgage payments? This actually isn't as hard as it sounds, thanks to the nature of a partnership and proper business accounting. With a good foundation the rest of the building proceeds quite cleanly. On month 1 your sister pays $1400 into the partnership, while you pay $645 into the partnership. FP will record an increase in assets (cash) of $1800, an increase in liability to your sister of $1400, and an increase in liability to you of $645. FP will then record a decrease in cash assets of $1800 to pay the mortgage, with a matching increase in cost account for the mortgage. No net change in equity, but your individual contributions are still preserved. Let's say that now after only 1 month you decide to sell the property - someone makes an offer you just can't refuse of $350,000 dollars (we'll pretend all the closing costs disappeared in buying and selling, but it should be clear how to account for those as I mention earlier). Now what happens? FP gets an increase in cash assets of $350,000, decreases the house asset ($320,000 - original purchase price), and pays off the mortgage - for simplicity let's pretend it's still $300,000 somehow. Now there's $50,000 in cash left in the partnership - who's money is it? By accounting for the house this way, the answer is easily determined. First all investments are paid back - so you get back $20,000 for the down payment, $645 for your mortgage payments so far, and your sister gets back $1400 for her mortgage payment. There is now $27,995 left, and by being equal partners you get to split it - 13,977 to you and your husband and the same amount to your sister (I'm keeping the extra dollar for my advice to talk to a lawyer/CPA). What About Getting To Live There? The fact is that your sister is getting a little something extra out of the deal - she get's the live there! How do you account for that? Well, you might just be calling it a gift. The problem is you aren't in any way, shape, or form putting that in writing, assigning it a value, nothing. Also, what do you do if you want to sell/cash out or at least get rid of the mortgage, as it will be showing up as a debt on your credit report and will effect your ability to secure financing of your own in the future if you decide to buy a house for your husband and yourself? Now this is the kind of stuff where families get in trouble. You are mixing personal lives and business arrangements, and some things are not written down (like the right to occupy the property) and this can really get messy. Would evicting your sister to sell the house before you all go bankrupt on a bad deal make future family gatherings tense? I'm betting it might. There should be a carefully worded lease probably from the partnership to your sister. That would help protect you from extra court costs in trying to determine who has the rights to occupy the property, especially if it's also written up as part of the partnership agreement...but now you are building the potential for eviction proceedings against your sister right into an investment deal? Ugh, what a potential nightmare! And done right, there should probably be some dollar value assigned to the right to live there and use the property. Unless you just want to really gift that to your sister, but this can be a kind of invisible and poorly quantified gift - and those don't usually work very well psychologically. And it also means she's going to be getting an awfully larger benefit from this \"\"investment\"\" than you and your husband - do you think that might cause animosity over dozens and dozens of writing out the check to pay for the property while not realizing any direct benefit while you pay to keep up your own living circumstances too? In short, you need a legal structure that can properly account for the fact that you are starting out in-equal contributors to your scheme, and ongoing contributions will be different over time too. What if she falls on hard times and you make a few of the mortgage payments? What if she wants to redo the bathroom and insists on paying for the whole thing herself or with her own loan, etc? With a properly documented partnership - or equivalent such business entity - these questions are easily resolved. They can be equitably handled by a court in event of family squabble, divorce, death, bankruptcy, emergency liquidation, early sale, refinance - you name it. No percentage of simple co-ownership recorded on a deed can do any of this for you. No math can provide you the proper protection that a properly organized business entity can. I would thus strongly advise you, your husband, and your sister to spend the comparatively tiny amount of extra money to get advice from a real estate/investment lawyer/CPA to get you set up right. Keep all receipts and you can pay a book keeper or the accountant to do end of the year taxes, and answer questions that will come up like how to properly account for things like depreciation on taxes. Your intuition that you should make sure things are formally written up in times when everyone is on good terms is extremely wise, so please follow it up with in-person paid consultation from an expert. And no matter what, this deal as presently structured has a really large built-in potential for heartache as you have three partners AND one of the partners is also renting the property partially from themselves while putting no money down? This has a great potential to be a train wreck, so please do look into what would happen if these went wrong into some more detail and write up in advance - in a legally binding way - what all parties rights and responsibilities are.\"" }, { "docid": "287162", "title": "", "text": "\"I looked this up on Wikipedia, and was hoping the answer would be \"\"no - stores cannot refuse legal tender\"\", but unfortunately, it's not the case! If the retailer wants to go to the lengths of refusing certain denominations to protect themselves from counterfeit currency, they are fully within their rights to do so. The \"\"Legal Tender\"\" page on Wikipedia says this about Canadian bills: [...] Retailers in Canada may refuse bank notes without breaking the law. According to legal guidelines, the method of payment has to be mutually agreed upon by the parties involved with the transactions. For example, convenience stores may refuse $100 bank notes if they feel that would put them at risk of being counterfeit victims [...] What is interesting about what I found out, is that legal tender cannot be refused if it is in repayment of an existing debt (i.e. not a store transaction for which there existed no previous debt). So you could offload your $100 bills when repaying your Sears credit card account (or pay in pennies if you wanted to!) and they couldn't refuse you!\"" }, { "docid": "121465", "title": "", "text": "\"Securities clearing and settlement is a complex topic - you can start by browsing relevant Wikipedia articles, and (given sufficient quantities of masochism and strong coffee) progress to entire technical books. You're correct - modern trade settlement systems are electronic and heavily streamlined. However, you're never going to see people hand over assets until they're sure that payment has cleared - given current payment systems, that means the fastest settlement time is going to be the next business day (so-called T+1 settlement), which is what's seen for heavily standardized instruments like standard options and government debt securities. Stocks present bigger obstacles. First, the seller has to locate the asset being sold & make sure they have clear title to it... which is tougher than it might seem, given the layers of abstraction/virtualization involved in the chain of ownership & custody, complicated in particular by \"\"rehypothecation\"\" involved in stock borrowing/lending for short sales... especially since stock borrow/lending record-keeping tends to be somewhat slipshod (cf. periodic uproar about \"\"naked shorting\"\" and \"\"failure to deliver\"\"). Second, the seller has to determine what exactly it is that they have sold... which, again, can be tougher than it might seem. You see, stocks are subject to all kinds of corporate actions (e.g. cash distributions, spin-offs, splits, liquidations, delistings...) A particular topic of keen interest is who exactly is entitled to large cash distributions - the buyer or the seller? Depending on the cutoff date (the \"\"ex-dividend date\"\"), the seller may need to deliver to the buyer just the shares of stock, or the shares plus a big chunk of cash - a significant difference in settlement. Determining the precise ex-dividend date (and so what exactly are the assets to be settled) can sometimes be very difficult... it's usually T-2, except in the case of large distributions, which are usually T+1, unless the regulatory authority has neglected to declare an ex-dividend date, in which case it defaults to standard DTC payment policy (i.e. T-2)... I've been involved in a few situations where the brokers involved were clueless, and full settlement of \"\"due bills\"\" for cash distributions to the buyer took several months of hard arguing. So yeah, the brokers want a little time to get their records in order and settle the trade correctly.\"" }, { "docid": "395995", "title": "", "text": "\"Understood. But based on the OP, it's not categorically clear what they were refusing. If they refused to quote the balance and/or refused to take a phone payment that was otherwise in keeping with the cardholder agreement (i.e., the cardmember called the correct number for phone payments and balance-checking, etc), then yeah, they were not only being unreasonable, but also violating the contract. What I read as ambiguous is whether the cardholder was specifically asking for the *payoff* balance/amount, and whether they were following process for phone-payments and balance-checking, etc. IOW, it's not necessarily \"\"illegal\"\" and might not even be unreasonable for the customer-service number to have different departments for balance-checking and phone-payments versus card-cancellation. It's not falsifiably clear from the OP that the cardholder was not asking the person on the other end of the phone for categorical statements of fact that they were obligated to make. I'm not accusing anyone of lying or saying that the CC company was acting reasonably, I'm just saying that language such as **\"\"They do not provide mid-cycle payoff quotes\"\"** is not evidence that they were doing any kind of funny-business.\"" } ]

[ { "docid": "494264", "title": "", "text": "To qualify as a woman owned business, a woman or group of women must own shares worth 51% of the business. If your investor was a woman, the entire 5% could come from her share of the company without affecting the 51% ownership requirement. Could you find a woman to add as an investor? If you each had your shares diluted 5%, She would be down to 48.45% ownership, and you would be down to 46.55% ownership. The only way for you to get back to a 51% female ownership situation would be to give a 2.55% ownership stake (from your share) to a wife, sister, mom, girlfriend, or any other woman who you think should benefit from this arrangement. This would still put you down at 44% (effectively taking the whole 5% from you) but by giving some of your share to someone else, it does require your partner to make some of the sacrifice, while still benefiting someone you care about (if you have someone you would like to give that benefit to). In summary, this is what it would look like:" } ]

[ { "docid": "378587", "title": "", "text": "History... No company has maintained such a high market cap over an extended amount of time. Not only that, but is Apple worth a trillion dollars? In a generation will their products be as popular? They're worth significantly more than Exxon Mobil at this point... If Apple's market cap does go to a trillion dollars its an upside of 60 percent or so. Or I can invest in a company like Lenovo whose market cap is 11 billion and is expanding like crazy. If their valuation goes up even to the 50 billion mark, that's an upside of nearly 400 percent. Plus there's the whole supply/demand dynamic for a stock that is already widely owned, how much more money can new investors put into it? When will all the funds who hold massive quantities sell? Etc... There are many reasons why no company has maintained a trillion dollar valuation.... Honestly it shocks me that people who frequent a finance message board don't understand these things." }, { "docid": "90519", "title": "", "text": "\"IPO is \"\"Initial Public Offering\"\". Just so you know. The valuations are done based on the company business model, intellectual property, products, market shares, revenues and profits, assets, and future projections. You know, the usual stuff. Yes, it is. And very frequently done. In fact, I can't think of any company that is now publicly traded, that didn't start this way. The first investor, the one who founds the company, is the first one who invests in it after raising the capital (even if it is from his own bank account to pay the fees for filing the incorporation papers). What is the difference between \"\"normal\"\" investor and \"\"angel\"\"? What do you refer to as \"\"angel\"\"? How is it abnormal to you? Any investor can play a role, depending on the stake he/she has in the company. If the stake is large enough - the role will be significant. If the stake is the majority - the investor will in fact be able major decisions regarding the company. How he bought the stocks, whether through a closed offering, initial investment or on a stock exchange - doesn't matter at all. You may have heard of the term \"\"angels\"\" with regards to high-tech start up companies. These are private investors (not funds) that invest their own money in start ups at very early stages. They're called \"\"angels\"\" because they invest at stages at which it is very hard for entrepreneurs to raise money: there's no product, no real business, usually it is a stage of just an idea or a patent with maybe initial prototype and some preliminary business analysis. These people gamble, in a sense, and each investment is very small (relatively to their wealth) - tens of thousands of dollars, sometimes a hundred or two thousands, and they make a lot of these. Some may fail and they lose the money, but those that succeed - bring very high returns. Imagine investing 10K for 5% stake at Google 15 years ago. Those people are as investors as anyone else, and yes, depending on their stake in the company, they can influence its decisions.\"" }, { "docid": "65914", "title": "", "text": "It would seem that the best method of bank robbery involves an inside man or woman, someone in the bank who can provide information about where the largest amount of cash is and when to hit the bank. $20,000 does not seem to be worth the risk of jail time. I'd say anything south of $100,000 per bank robber probably wouldn't be worth it, and getting that amount of cash would require more than a simple walk-in, pull a gun, empty a register robbery. The trick would either be proving an iron-clad alibi for the inside person or the group of robbers collectively contributing to the cost of that person disappearing. At the very least, that individual should get the largest share of the score. Escape is undoubtedly the biggest issue. One would need immediate transportation from the scene of the crime which could leave the area, then be dumped (fully scrubbed for prints, DNA, etc.) then the group would all go their separate ways. Regardless, I don't think it's worth the risk or the effort. First off, when you rob a bank the greedy bankers doesn't lose the money, it's paid by the FDIC, which is founded by taxpayers, so what you're doing is taking money that might otherwise be spent on social services for people who need them. Moreover, it's expensive and time-consuming to launder large amounts of money. If you manage to get $120,000 out of a robbery, which is hugely optimistic, that number would take years and a significant fraction of the take just to clean for personal use. And the risk of not only prison but possibly death seems rather extreme when compared to the admittedly more dull alternative of finding and holding down career. I think there are probably more efficient criminal methods of obtaining large quantities of money/wealth, too. Illegal narcotics, for example, are a $300 billion a year industry. While it's not the easiest business to get into, one imagines, the potential for someone who isn't just some moron off the street to climb the cartel ladder could be significant and could lead to a high income. There are significant risks, of course, and there's a serious moral question as to whether selling illegal drugs is acceptable or not, but if you're morally flexible or have the opinion that illegal narcotics are not something that should be prohibited, it could work. And there's always money in the banana stand." }, { "docid": "174693", "title": "", "text": "That's a very good point. As much as I love cars I'd be happy to have the choice of any high end car on demand at the touch of a button, and not have to maintain it or take the hit of depreciation. The insurance premium then will be down to manufacturers or car suppliers, who are probably big enough to run their own insurance schemes. In this scenario perhaps it doesn't bode well for Geico, unless they get into the car business." }, { "docid": "139418", "title": "", "text": "\"People seem to think that Yelp serves businesses or the public. It doesn't. It serves Yelpers. Yelpers want reviews from other Yelpers – and that's it. If you don't review things frequently on Yelp, they don't care about your opinion. Sorry. Nothing personal, but this website is only interested in reviews from people who use the site frequently. You might be the most upstanding person in the world, and you might post a great review of a business, but this isn't your blog. You're not entitled to have the world see your review here. They only want the opinion of regular Yelpers. If you want to be a part of the Yelp community, keep making reviews, and they'll un-filter your reviews. There are people who say that businesses that pay Yelp get more reviews, but it's not true. The article even states that she was paying $350/month *before* these reviews got filtered out. The article also says a court case against Yelp was thrown out because there was no evidence showing bias. People who claim this are just butt-hurt and want to justify their bias by claiming that Yelp is greedy and unscrupulous. The fact of the matter is this: Yelp has a powerful community. Business owners see Yelp as possibly affecting their business. They want to have control over that, but they can't. In fact, Yelp goes out of their way to prevent that. Many business owners simply aren't mentally capable of grasping how some things work, and when things don't go their way, they get angry and make accusations. This particular woman, who is currently taking 3 hours of \"\"social media classes per week\"\" (WTF), thinks “there maybe needs to be some rules on the net that aren’t there now.” No offense lady, but you probably shouldn't be writing internet laws until you're done with your \"\"internet for dummies\"\" classes. You might think that this is not a good model for a review website. If so, don't use it. It's not a government institution and you're not obligated to use it. Go find another review site. Better yet, if you think Yelp is so horrible, go make your own review website that allows anyone to review things. I'm sure it will be great and everyone will love it. Whatever you choose, stop trying to ruin Yelp. The people who use it like the way the it is and don't want some butt-hurt non-users fucking it up.\"" }, { "docid": "281841", "title": "", "text": "\"The amount, reliability and frequency of dividends paid by an ETF other than a stock, such as an index or mutual fund, is a function of the agreement under which the ETF was established by the managing or issuing company (or companies), and the \"\"basket\"\" of investments that a share in the fund represents. Let's say you invest in a DJIA-based index fund, for instance Dow Diamonds (DIA), which is traded on several exchanges including NASDAQ and AMEX. One share of this fund is currently worth $163.45 (Jan 22 2014 14:11 CDT) while the DJIA itself is $16,381.38 as of the same time, so one share of the ETF represents approximately 1% of the index it tracks. The ETF tracks the index by buying and selling shares of the blue chips proportional to total invested value of the fund, to maintain the same weighted percentages of the same stocks that make up the index. McDonald's, for instance, has an applied weight that makes the share price of MCD stock roughly 5% of the total DJIA value, and therefore roughly 5% of the price of 100 shares of DIA. Now, let's say MCD issued a dividend to shareholders of, say, $.20 per share. By buying 100 shares of DIA, you own, through the fund, approximately five MCD shares, and would theoretically be entitled to $1 in dividends. However, keep in mind that you do not own these shares directly, as you would if you spent $16k buying the correct percentage of all the shares directly off the exchange. You instead own shares in the DIA fund, basically giving you an interest in some investment bank that maintains a pool of blue-chips to back the fund shares. Whether the fund pays dividends or not depends on the rules under which that fund was set up. The investment bank may keep all the dividends itself, to cover the expenses inherent in managing the fund (paying fund management personnel and floor traders, covering losses versus the listed price based on bid-ask parity, etc), or it may pay some percentage of total dividends received from stock holdings. However, it will virtually never transparently cut you a check in the amount of your proportional holding of an indexed investment as if you held those stocks directly. In the case of the DIA, the fund pays dividends monthly, at a yield of 2.08%, virtually identical to the actual weighted DJIA yield (2.09%) but lower than the per-share mean yield of the \"\"DJI 30\"\" (2.78%). Differences between index yields and ETF yields can be reflected in the share price of the ETF versus the actual index; 100 shares of DIA would cost $16,345 versus the actual index price of 16,381.38, a delta of $(36.38) or -0.2% from the actual index price. That difference can be attributed to many things, but fundamentally it's because owning the DIA is not the exact same thing as owning the correct proportion of shares making up the DJIA. However, because of what index funds represent, this difference is very small because investors expect to get the price for the ETF that is inherent in the real-time index.\"" }, { "docid": "317533", "title": "", "text": "\"You are your own worst enemy when it comes to investing. You might think that you can handle a lot of risk but when the market plummets you don't know exactly how you'll react. Many people panic and sell at the worst possible time, and that kills their returns. Will that be you? It's impossible to tell until it happens. Don't just invest in stocks. Put some of your money in bonds. For example TIPS, which are inflation adjusted treasury bonds (very safe, and the return is tied to the rate of inflation). That way, when the stock market falls, you'll have a back-stop and you'll be less likely to sell at the wrong time. A 50/50 stock/bond mix is probably reasonable. Some recommend your age in bonds, which for you means 20% or so. Personally I think 50/50 is better even at your young age. Invest in broad market indexes, such as the S&P 500. Steer clear of individual stocks except for maybe 5-10% of your total. Individual stocks carry the risk of going out of business, such as Enron. Follow Warren Buffet's two rules of investing: a) Don't lose money b) See rule a). Ignore the \"\"investment porn\"\" that is all around you in the form of TV shows and ads. Don't chase hot companies, sectors or countries. Try to estimate what you'll need for retirement (if that's what your investing for) and don't take more risk than you need to. Try to maintain a very simple portfolio that you'll be able to sleep well with. For example, check into the coffeehouse investor Pay a visit to the Bogleheads Forum - you can ask for advice there and the advice will be excellent. Avoid investments with high fees. Get advice from a good fee-only investment advisor if needed. Don't forget to enjoy some of your money now as well. You might not make it to retirement. Read, read, read about investing and retirement. There are many excellent books out there, many of which you can pick up used (cheap) through amazon.com.\"" }, { "docid": "565769", "title": "", "text": "I don't think you know who you are talking to. I build houses for a living. I'm a guy that works with his hands. I hire hundreds of people who work with their hands for a living. Do I assume the worst of the guys that work with me? Absolutely not. There are plenty that do great work and are a joy to work with. However, there are plenty who are not. One of my workers bought a giant truck while dodging child support for the 4 children he has with 3 different women. Should he own a house? Is he capable of consistently making the payments while maintaining it? If he didn't get paid on Friday he left the job because he couldn't afford his bills. When he was overpaid on a Friday he blew $400 partying over the weekend and was right back to broke by the next Friday. It's a pretty silly argument to suggest that everyone is capable of owning a house. A house is a statement of value in society. It takes hundreds of people thousands of hours to build. That work culminates into a finished product that is paid off over a long period of time. If you are untrustworthy and cannot handle finances, you can't afford a house. If you do not provide the value to society that is comparable to the house you want, you can't afford a house. That being said, the initial argument is as bogus as yours. I have a 2 bed 1 bath apartment for rent for $500 right now inside 610 loop in Houston TX. It's 10-15 minutes from downtown." }, { "docid": "439349", "title": "", "text": "\"In Italy (even with taxes that are more than 50% on income) owning garages is generally a good business, as you said: \"\"making money while you sleep\"\", because of no maintainance. Moreover garages made by real concrete (and not wood like in US) are still new after 50 years, you just repaint them once every 20 years and you change the metal door gate once every 30 years. After 20 years you can be sure the price of the garage will be higher than what you paied it (at least for the effect of the inflation, after 20 years concrete and labour work will cost more than today). The only important thing before buying it is to make sure it is in an area where people are eager to rent it. This is very common in Italian cities' downtown because they were built in dark ages when cars did not exists, hence there are really few available parkings.\"" }, { "docid": "599003", "title": "", "text": "If I own shares of a company, am I entitled to apply as position of CEO? Sure, but anybody else can apply too. Who decides? The corporate board of directors, who are nominally chosen by a vote of the stockholders. I say nominally, because in practice they are nominated by the current CEO and it's very rare for stockholders to veto the CEO's choice. Once in a while a group of stockholders will nominate their own candidate for the board, but they rarely win. I'd like to think there's some socio-corporate or investor-relationship advantage to working or having the option to work in certain positions in said company -- especially by privilege or total outstanding share ownership numbers. Why? Simply holding a large number of shares doesn't necessarily mean you know anything about running the business." }, { "docid": "109828", "title": "", "text": "\"She can't afford the house she's living in either. A $2,200 payment is about a $400K to well over half a million dollar home depending on her interest rate. Her housing costs should be at most 30% of her take home income, which is about $1,020 and would ***ONLY*** allow her to be able to afford to share a multi-bedroom apartment in Santa Cruz. Homes start in the $400K Range in that areas and go into the (tens of) millions of dollars. The $700/ month loan issue is bad but that house is going to be the final nail in the coffin the moment home repairs need to be done and she can't afford to do them. Personally I gave up trying to make the housing situation work out here in the Bay Area. My rent is jumping from $2,300 to $2,600 next month right over the hill in Santa Clara. I decided to buy a decent, modest, house in a great city the Midwest. Mortgage before property taxes and insurance is only $1,100. Out here in California it would be valued at an $800K to $900K home easily with close to a $5,500 mortgage payment. No thanks. If anything these articles are a good example of people playing fast and loose with their personal finances. The woman in the article is simply living beyond her means. Credit lets you pretend that you're of larger means than you really are for only so long. I made the choice to fund my retirement and pay off a home, rather than sunshine and close proximity to the beach. As the woman in the article mentioned: &gt;\"\"I will be working *for as long as I'm employable*. I will never be able to retire, At her age it may not be very long until she finds herself unemployable. She's right about never retiring, she spent her retirement living some place she couldn't afford to live, while obtaining an education she couldn't afford to pay for.\"" }, { "docid": "129540", "title": "", "text": "\"The first rule I follow is pretty simple: Get paid for what you do. Earn a return on what you own. If you are running your company prudently, you should earn a salary for the position and responsibilities you hold within the business. This salary should be competitive. You should be able to replace yourself in the business at this salary. If your title is \"\"President\"\" or \"\"CEO\"\" - look for market rate salaries for others in that position within your industry and company size. If you wear multiple hats in a small business, you will likely have to blend this salary based on those various positions. Based on how you run your business, the money left over at the end of the year after you and your team takes a competitive wage is your profit. If there isn't any profit, then you might want to do some work on your business model. But if their is a profit, then it's a clear return on what you own and not just a payment for work completed. The idea would be that you could exit the business as an operator, pay someone else to do exactly what you do, and you would continue to get that profit return at the end of the year. This is when a business acts like a true asset. Whether you take your money in salary or profit distributions (or dividends) depending on your structure, taxes are about the same. W2'd salaries get normal employee contributed taxes, but then of course the company matches these. It is identical if you take a guaranteed payment or distribution that gets hit with self employment taxes. Profits are also going to get hit with the same taxes. Follow ups: 1) A fair salary would be a competitive market wage for the position you hold within the business. What is left over would be considered true profits and not just fabricated profits by taking a lower than market wage to boost the appearance of profitability. 2) Shareholders requesting salary information would be covered in your Operating Agreement or Shareholder Agreement. This might be terms you set with your investors. Or you might simply set a term that you only need approval if a single salary exceeds a cap (like $250,000). Which would mean you would need to present why you deserve a higher salary and have your board approve (if you are governed by said board via your investors). Profitability is a different ballpark. Your investors most likely have a right to see a monthly, quarterly, and/or annual Profit & Loss statement which should clearly state profitability. I can't imagine running a completely closed book company to my investors. Actually... I can't really imagine ever investing in a company where I am not permitted to see the financials. Something to also consider here is the threat of trying to keep your profit numbers low in order to not pay taxes or to pay yourself a higher salary. If you ever plan to sell or exit the company, most widely accepted valuations of a business are done from profits (or EBIDTA). You might think you are saving yourself a couple points on taxes by avoiding profits in the short term, but if you exit the business and get a 3-5X (or even up to 12X in some cases) multiplier on your annual profits, you might be kicking yourself for trying to hide them through your accounting practices. Buyers will often sniff out an owner who created false profits by not paying themselves, but what's harder to do is figure out how much profits should have been when there were none on the books. By saving yourself $100,000 in taxes this year, could add up to close to $1,000,000 in an acquisition. Good luck.\"" }, { "docid": "45970", "title": "", "text": "\"Index funds can be a very good way to get into the stock market. It's a lot easier, and cheaper, to buy a few shares of an index fund than it is to buy a few shares in hundreds of different companies. An index fund will also generally charge lower fees than an \"\"actively managed\"\" mutual fund, where the manager tries to pick which stocks to invest for you. While the actively managed fund might give you better returns (by investing in good companies instead of every company in the index) that doesn't always work out, and the fees can eat away at that advantage. (Stocks, on average, are expected to yield an annual return of 4%, after inflation. Consider that when you see an expense ratio of 1%. Index funds should charge you more like 0.1%-0.3% or so, possibly more if it's an exotic index.) The question is what sort of index you're going to invest in. The Standard and Poor's 500 (S&P 500) is a major index, and if you see someone talking about the performance of a mutual fund or investment strategy, there's a good chance they'll compare it to the return of the S&P 500. Moreover, there are a variety of index funds and exchange-traded funds that offer very good expense ratios (e.g. Vanguard's ETF charges ~0.06%, very cheap!). You can also find some funds which try to get you exposure to the entire world stock market, e.g. Vanguard Total World Stock ETF, NYSE:VT). An index fund is probably the ideal way to start a portfolio - easy, and you get a lot of diversification. Later, when you have more money available, you can consider adding individual stocks or investing in specific sectors or regions. (Someone else suggested Brazil/Russia/Indo-China, or BRICs - having some money invested in that region isn't necessarily a bad idea, but putting all or most of your money in that region would be. If BRICs are more of your portfolio then they are of the world economy, your portfolio isn't balanced. Also, while these countries are experiencing a lot of economic growth, that doesn't always mean that the companies that you own stock in are the ones which will benefit; small businesses and new ventures may make up a significant part of that growth.) Bond funds are useful when you want to diversify your portfolio so that it's not all stocks. There's a bunch of portfolio theory built around asset allocation strategies. The idea is that you should try to maintain a target mix of assets, whatever the market's doing. The basic simplified guideline about investing for retirement says that your portfolio should have (your age)% in bonds (e.g. a 30-year-old should have 30% in bonds, a 50-year-old 50%.) This helps maintain a balance between the volatility of your portfolio (the stock market's ups and downs) and the rate of return: you want to earn money when you can, but when it's almost time to spend it, you don't want a sudden stock market crash to wipe it all out. Bonds help preserve that value (but don't have as nice of a return). The other idea behind asset allocation is that if the market changes - e.g. your stocks go up a lot while your bonds stagnate - you rebalance and buy more bonds. If the stock market subsequently crashes, you move some of your bond money back into stocks. This basically means that you buy low and sell high, just by maintaining your asset allocation. This is generally more reliable than trying to \"\"time the market\"\" and move into an asset class before it goes up (and move out before it goes down). Market-timing is just speculation. You get better returns if you guess right, but you get worse returns if you guess wrong. Commodity funds are useful as another way to diversify your portfolio, and can serve as a little bit of protection in case of crisis or inflation. You can buy gold, silver, platinum and palladium ETFs on the stock exchanges. Having a small amount of money in these funds isn't a bad idea, but commodities can be subject to violent price swings! Moreover, a bar of gold doesn't really earn any money (and owning a share of a precious-metals ETF will incur administrative, storage, and insurance costs to boot). A well-run business does earn money. Assuming you're saving for the long haul (retirement or something several decades off) my suggestion for you would be to start by investing most of your money* in index funds to match the total world stock market (with something like the aforementioned NYSE:VT, for instance), a small portion in bonds, and a smaller portion in commodity funds. (For all the negative stuff I've said about market-timing, it's pretty clear that the bond market is very expensive right now, and so are the commodities!) Then, as you do additional research and determine what sort investments are right for you, add new investment money in the places that you think are appropriate - stock funds, bond funds, commodity funds, individual stocks, sector-specific funds, actively managed mutual funds, et cetera - and try to maintain a reasonable asset allocation. Have fun. *(Most of your investment money. You should have a separate fund for emergencies, and don't invest money in stocks if you know you're going need it within the next few years).\"" }, { "docid": "384994", "title": "", "text": "\"Yes and No. Almost everybody wants to own their own business. And they would gladly piss away an investor's money trying to make it happen. It's not just FUNDS that are required. I'm sure we both know some people that should not start a business of their own, no matter how it's financed. One of the big barriers to starting a business is regulation. We all want products that are safe to use and produced responsibly, but if the regulations are such that only a handful of the largest companies are capable of compliance, then those companies can be assured they will never have any credible competition. Regulation is a very careful balancing act. But your question wasn't \"\"What stops new businesses new businesses from forming?\"\" You asked what creates more business owners. A lot of that is actually cultural. To be a business owner you have to have a lot of specific personality traits that most people don't have. You have to be motivated to work hard, passionate about what you want to do, organized enough to approach it consistently, analytical enough to create a solid business plan that makes sense, and rational enough to know when to quit if it's not working. Finally (and this is a big one) you have to be able to **sell** that passion to investors, prospective customers and your first employees. The best widget in the world won't sell if it's being marketed by someone who doesn't know how to market things. What we need to do is find a way to provide consulting and resources to people who are developing those skills.\"" }, { "docid": "50428", "title": "", "text": "Even though the person you're responding to actually said paternity leave, I'll respond to the benefit that maternity leave provides to employers: Businesses with a paid maternity leave policy benefit in 2 ways. 1) Companies that pay for a maternity leave period (as opposed to allowing the time off but requiring it be unpaid) have hire retention - which means that the woman is more likely to come back than become a stay at home mom. 2) Companies with good maternity leave policies get the pick of the litter in hiring women. So while they're perhaps having to hire men they feel are in the top 20th percentile, with women, they're able to hire top ten percentile." }, { "docid": "275249", "title": "", "text": "\"There are three (or four) ways that a company can grow: (Crowdfunding is a relatively new (in mainstream businesses) alternative financing method where people will finance a company with the expectation that they will benefit from the product or service that they provide.) Obviously a startup has no prior income to use, so it must either raise money through equity or debt. People say that one must borrow contingent on their salary. Banks lend money based on the ability to pay the loan back plus interest. For individuals, their income is their primary source of cash flow, so, yes, it is usually the determining factor in getting a loan. For a business the key factor is future cash flows. So a business will borrow money, say, to buy a new asset (like a factory) that will be used to generate cash flows in the future so that they can pay down the debt. If the bank believes that the use of the money is going to be profitable enough that they will get their money back with interest, they'll loan the money. Equity investors are essentially the same, but since they don't get a guaranteed payback (they only get paid through non-guaranteed dividends or liquidation), their risk is higher and they are looking for higher expected returns. So the question I'd have as a bank or equity investor is \"\"what are you going to do with the money?\"\" What is your business strategy? What are you going to do that will make profits in the future? Do you have a special idea or skill that you can turn into a profitable business? (Crowdfunding would be similar - people are willing to give you money based on either the social or personal benefit of some product or service.) So any business either starts small and grows over time (which is how the vast majority of businesses grow), or has some special idea, asset, skill, or something that would make a bank willing to take a risk on a huge loan. I know, again, that people here tend to turn blind eyes on unfortunate realities, but people do make giant businesses without having giant incomes. The \"\"unfortunate reality\"\" is that most startups fail. Which may sound bad, but also keep in mind that most startups are created by people that are OK with failing. They are people that are willing to fail 9 times with the thought that the 10th one will take off and make up for the losses of the first 9. So I would say - if you have some great idea or skill and a viable strategy and plan to take it to market, then GO FOR IT. You don't need a huge salary to start off. You need something that you can take to market and make money. Most people (myself included) either do not have that idea or skill to go out on their own, or don't have the courage to take that kind of risk. But don't go in assuming all you need is a loan and you'll be an instant millionaire. You might, but the odds are very long.\"" }, { "docid": "77088", "title": "", "text": "Well, to get money, you need to leverage your assets. So your options basically are: - Asset: Cash. Well, I figure if you had, you wouldn't have asked how to get more of it, but its always worth mentioning. Don't forget about cash that can be in tricky places to tap, like 401ks, IRAs, investment accounts, etc. There is usually some way to get at the cash, but it may not be worth it and you could end up sacrificing long term financial stability if you do. - Asset: Job Skills and Initiative. Get a job and and earn the cash. $2k is not a ton, and if you live frugally you should be able to save it. There are tons of websites dedicated to living frugally and earning extra cash on the side. My personal favorite is r/beermoney. - Asset: Good Credit. Borrow the money from a traditional bank. Signature loans go up to $35k at most banks, just ask what it would take to qualify. You could also get a credit card for that amount, and use it to start up the business. - Asset. Bad Credit. If you've got bad credit, you can still take out a loan from a place like Prosper or Lending Club or Sofi (these places are handy if you have good credit, too). Your rates will be much higher, but they will still lend to you. - Asset: Property. If you own stuff, you can sell it and get cash. Clean out your attic (or ask relatives if you can have the stuff in theirs!) and sell it. If you own fancy stuff, you can borrow against it (home, car, boat, etc.). - Asset: Your Charm and Winning Smile. If you have a good, solid business plan (written down and professional looking), ask around and see if you can find an investor. It could be friends or family, but it could also be someone who is looking to invest. Be professional, and be sure to draw up the appropriate business docs if you do a partnership or take a private loan. - Asset: Your Government. If you live in the US, there are federal programs that offer Small Business Loans. Check out sba.gov for more info. You will need a business plan and will have to meet the criteria of the loan or grant. Not sure if your Ecommerce business will meet the criteria, as the intent of these types of programs are to spur the economy by allowing small business owners to hire workers. But its worth checking out." }, { "docid": "30959", "title": "", "text": "\"Disclosure: I don't have an iPhone, so I don't use RobinHood. That being said, I have a less \"\"they're-out-to-get-ya\"\" view of what they're doing. As a small business owner (2 businesses), employees cost the most. If you can create a solid business with few (or no) employees and let robots run it, you will drastically reduce your costs. Joe Polish said it similarly with sales letters, something along the lines of they never complain about a headache, need to take a year off to discover themself, or just need a personal day. Robots are the same; they do not have human limits. Most simple trading can be done and maintained by well written code and AI, there's very little need for humans to do anything other than build it. Think about the efficiency of bitcoin versus all the central banks combined; how many people are employed by central banks? Robinhood states that they are using technology in these ways to minimize costs and they're using a system that doesn't need physical branches (this doesn't mean they will never have them, just that they don't need them). Robinhood does not indicate that they allow everything to happen for free; only stock trading. I worked for a large trading firm once and observed that stock trading wasn't the bulk of where they made their money anyway; trading options, futures, index funds, etc are where the big money was and Robinhood says nothing about those being free. Like the CQM mentioned too, they'll be charging for margin as well. In a way, the individual stock trader is dead; many people - including this forum - prefer index funds, so more than likely, Robinhood will strike up a deal with an index fund company or create their own (this is just easy, passive income with an expense ratio). In this category, the markets are their playground, but they do need to attract enough people to their platform, thus free stock trading is a good way to do it. As for selling your information for advertising, that is always a possibility, but they have quite a few other options that would be good for most investors (index funds, affiliating with financial fund companies, etc) where they can start before ever needing to dip their toe in selling information. This isn't to say they won't do it, but that there are few other options they have. The major concern I have for Robinhood is ongoing security. Just building it and letting it run kind of assumes that there won't be major compromises in the future and as AI evolves, superior AI might be able to crush older AI.\"" }, { "docid": "209349", "title": "", "text": "\"I'll take a stab at this question and offer a disclosure: I recently got in RING (5.1), NEM (16.4), ASX:RIO (46.3), and FCX (8.2). While I won't add to my positions at current prices, I may add other positions, or more to them if they fall further. This is called catching a falling dagger and it's a high risk move. Cons (let's scare everyone away) Pros The ECB didn't engage in as much QE as the market hoped and look at how it reacted, especially commodities. Consider that the ECB's actions were \"\"tighter\"\" than expected and the Fed plans to raise rates, or claims so. Commodities should be falling off a cliff on that news. While most American/Western attention is on the latest news or entertainment, China has been seizing commodities around the globe like crazy, and the media have failed to mention that even with its market failing, China is still seizing commodities. If China was truly panicked about its market, it would stop investing in other countries and commodities and just bail out its own country. Yet, it's not doing that. The whole \"\"China crisis\"\" is completely oversold in the West; China is saying one thing (\"\"oh no\"\"), but doing another (using its money to snap up cheap commodities). Capitalism works because hard times strengthen good companies. You know how many bailouts ExxonMobil has received compared to Goldman Sachs? You know who owns more real wealth? Oil doesn't get bailed out, banks do, and banks can't innovate to save their lives, while oil innovates. Hard times strengthen good companies. This means that this harsh bust in commodities will separate the winners from the losers and history shows the winners do very well in the long run. Related to the above point: how many bailouts from tax payers do you think mining companies will get? Zero. At least you're investing in companies that don't steal your money through government confiscation. If you're like me, you can probably find at least 9 people out of 10 who think \"\"investing in miners is a VERY BAD idea.\"\" What do they think is a good idea? \"\"Duh, Snapchat and Twitter, bruh!\"\" Then there's the old saying, \"\"Be greedy when everyone's fearful and fearful when everyone's greedy.\"\" Finally, miners own hard assets. Benjamin Graham used to point this out with the \"\"dead company\"\" strategy like finding a used cigarette with one more smoke. You're getting assets cheap, while other investors are overpaying for stocks, hoping that the Fed unleashes moar QE! Think strategy here: seize cheap assets, begin limiting the supply of these assets (if you're the saver and not borrowing), then watch as the price begins to rise for them because of low supply. Remember, investors are part owners in companies - take more control to limit the supply. Using Graham's analogy, stock pile those one-puff cigarettes for a day when there's a low supply of cigarettes. Many miners are in trouble now because they've borrowed too much and must sell at a low profit, or in some cases, must lose. When you own assets debt free, you can cut the supply. This will also help the Federal Reserve, who's been desperately trying to figure out how to raise inflation. The new patriotic thing to do is stimulate the economy by sending inflation up, and limiting the supply here is key.\"" } ]

[ { "docid": "187073", "title": "", "text": "In addition to finding another woman investor, you have an equitable option that is not unreasonable: ask your partner to buy out 3% worth of shares from you (which then gives her 54%, allowing you to then sell 5% to an investor and have it not dilute her below 51%: .54 * .95 = .513). That keeps you whole but also keeps your woman-owned-business status." } ]

[ { "docid": "53737", "title": "", "text": "&gt; Paternity leave. The situation now allows managers to hire a man over a woman because he can't take off when he has a child. Requiring that he be offered the same or similar option reduces or eliminates that incentive for hiring a man instead of a woman. This is a good idea. Of course, with every upside there is a downside. The downside is that it will become an age-discrimination thing, and all people under 40 will have a harder time getting jobs. **edit: took the wrong quote**" }, { "docid": "434303", "title": "", "text": "*Paternity* leave. The situation now allows managers to hire a man over a woman because he can't take off when he has a child. Requiring that he be offered the same or similar option reduces or eliminates that incentive for hiring a man instead of a woman. Another way of looking at it: most people think that the way to promote hiring women is to make them better potential employees, but another way to do it is to make men worse potential employees (by giving them the same time off)." }, { "docid": "358154", "title": "", "text": "\"You can start investing with any amount. You can use the ShareBuilder account to purchase \"\"partial\"\" stocks through their automatic investment plan. Usually brokers don't sell parts of stock, and ShareBuilder is the only one allowing it IMHO using its own tricks. What they do basically is buy a stock and then divide it internally among several investors who bought it, while each of the investors doesn't really own it directly. That's perfect for investing small amounts and making first steps in investing.\"" }, { "docid": "451352", "title": "", "text": "I was wondering why equity is reflecting ownership of the issuing entity? That is the definition of equity in this regard. My understanding is that for a stock/equity, its issuing entity is a company/firm that sells the stock/equity, while its receiving entity is an investor that buys the stock/equity Correct. equity reflects ownership of the receiving entity i.e. investor Incorrect. Equity reflects ownership by the receiving entity of the issuing entity. That is, when you buy stock in a company (taking an equity stake in the company) you buy a piece of the company. It would be rather odd for the company to own a piece of you when you buy their stock." }, { "docid": "289582", "title": "", "text": "Use a limited company. Use the HMRC website for help on limited companies and get a good accountant for doing your taxes. Mixing your website income and personal income may make you pay a higher tax rate. You can take out expenses from the limited company, which are tax deductible. But if you group it in personal income it wouldn't be tax deductible. In a personal capacity you are 100% liable if your business goes bust and you owe debt. But for a limited company you are only liable for what you own i.e %age of shares. You can take on an investor if your business booms and it is easier if you do it through a limited company rather than through a personal endeavour." }, { "docid": "589191", "title": "", "text": "&gt;Everyone in this room is dealing with their own version of the candle problem. Maybe true. The Ted talk audience are highly educated, affluent, and intelligent people. Likely professionals. For the general public, the people who build buildings, maintain infrastructure, do any manual labor in general, in a non professional setting- these people are not experiencing their own version of the candle problem. Even in an office, service, or administrative setting, how many of these jobs are procedural and focused in their tasks and objectives. I feel that his insights, while valuable, aren't applicable to the productivity intensive problem that things like UBI face." }, { "docid": "214003", "title": "", "text": "\"For personal investing, and speculative/ highly risky securities (\"\"wasting assets\"\", which is exactly what options are), it is better to think in terms of sunk costs. Don't chase this trade, trying to make your money back. You should minimize your loss. Unwind the position now, while there is still some remaining value in those call options, and take a short-term loss. Or, you could try this. Let's say you own an exchange traded call option on a listed stock (very general case). I don't know how much time remains before the option's expiration date. Be that as it may, I could suggest this to effect a \"\"recovery\"\". You'll be long the call and short the stock. This is called a delta hedge, as you would be delta trading the stock. Delta refers to short-term price volatility. In other words, you'll short a single large block of the stock, then buy shares, in small increments, whenever the market drops slightly, on an intra-day basis. When the market price of the stock rises incrementally, you'll sell a few shares. Back and forth, in response to short-term market price moves, while maintaining a static \"\"hedge ratio\"\". As your original call option gets closer to maturity, roll it over into the next available contract, either one-month, or preferably three-month, time to expiration. If you don't want to, or can't, borrow the underlying stock to short, you could do a synthetic short. A synthetic short is a combination of a long put and a short call, whose pay-off replicates the short stock payoff. I personally would never purchase an unhedged option or warrant. But since that is what you own right now, you have two choices: Get out, or dig in deeper, with the realization that you are doing a lot of work just to trade your way back to a net zero P&L. *While you can make a profit using this sort of strategy, I'm not certain if that is within the scope of the money.stachexchange.com website.\"" }, { "docid": "235391", "title": "", "text": "\"In a sentence, stocks are a share of equity in the company, while bonds are a share of credit to the company. When you buy one share of stock, you own a (typically infinitesimal) percentage of the company. You are usually entitled to a share of the profits of that company, and/or to participate in the business decisions of that company. A particular type of stock may or may not pay dividends, which is the primary way companies share profits with their stockholders (the other way is simply by increasing the company's share value by being successful and thus desirable to investors). A stock also may or may not allow you to vote on company business; you may hear about companies buying 20% or 30% \"\"interests\"\" in other companies; they own that percentage of the company, and their vote on company matters is given that same weight in the total voting pool. Typically, a company offers two levels of stocks: \"\"Common\"\" stock usually has voting rights attached, and may pay dividends. \"\"Preferred\"\" stock usually gives up the voting rights, but pays a higher dividend percentage (maybe double or triple that of common stock) and may have payment guarantees (if a promised dividend is missed in one quarter and then paid in the next, the preferred stockholders get their dividend for the past and present quarters before the common shareholders see a penny). Governments and non-profits are typically prohibited from selling their equity; if a government sold stock it would basically be taxing everyone and then paying back stockholders, while non-profit organizations have no profits to pay out as dividends. Bonds, on the other hand, are a slice of the company's debt load. Think of bonds as kind of like a corporate credit card. When a company needs a lot of cash, it will sell bonds. A single bond may be worth $10, $100, or $1000, depending on the investor market being targeted. This is the amount the company will pay the bondholder at the end of the term of the bond. These bonds are bought by investors on the open market for less than their face value, and the company uses the cash it raises for whatever purpose it wants, before paying off the bondholders at term's end (usually by paying each bond at face value using money from a new package of bonds, in effect \"\"rolling over\"\" the debt to the next cycle, similar to you carrying a balance on your credit card). The difference between the cost and payoff is the \"\"interest charge\"\" on this slice of the loan, and can be expressed as a percentage of the purchase price over the remaining term of the bond, as its \"\"yield\"\" or \"\"APY\"\". For example, a bond worth $100 that was sold on Jan 1 for $85 and is due to be paid on Dec 31 of the same year has an APY of (15/85*100) = 17.65%. Typically, yields for highly-rated companies are more like 4-6%; a bond that would yield 17% is very risky and indicates a very low bond rating, so-called \"\"junk status\"\".\"" }, { "docid": "275249", "title": "", "text": "\"There are three (or four) ways that a company can grow: (Crowdfunding is a relatively new (in mainstream businesses) alternative financing method where people will finance a company with the expectation that they will benefit from the product or service that they provide.) Obviously a startup has no prior income to use, so it must either raise money through equity or debt. People say that one must borrow contingent on their salary. Banks lend money based on the ability to pay the loan back plus interest. For individuals, their income is their primary source of cash flow, so, yes, it is usually the determining factor in getting a loan. For a business the key factor is future cash flows. So a business will borrow money, say, to buy a new asset (like a factory) that will be used to generate cash flows in the future so that they can pay down the debt. If the bank believes that the use of the money is going to be profitable enough that they will get their money back with interest, they'll loan the money. Equity investors are essentially the same, but since they don't get a guaranteed payback (they only get paid through non-guaranteed dividends or liquidation), their risk is higher and they are looking for higher expected returns. So the question I'd have as a bank or equity investor is \"\"what are you going to do with the money?\"\" What is your business strategy? What are you going to do that will make profits in the future? Do you have a special idea or skill that you can turn into a profitable business? (Crowdfunding would be similar - people are willing to give you money based on either the social or personal benefit of some product or service.) So any business either starts small and grows over time (which is how the vast majority of businesses grow), or has some special idea, asset, skill, or something that would make a bank willing to take a risk on a huge loan. I know, again, that people here tend to turn blind eyes on unfortunate realities, but people do make giant businesses without having giant incomes. The \"\"unfortunate reality\"\" is that most startups fail. Which may sound bad, but also keep in mind that most startups are created by people that are OK with failing. They are people that are willing to fail 9 times with the thought that the 10th one will take off and make up for the losses of the first 9. So I would say - if you have some great idea or skill and a viable strategy and plan to take it to market, then GO FOR IT. You don't need a huge salary to start off. You need something that you can take to market and make money. Most people (myself included) either do not have that idea or skill to go out on their own, or don't have the courage to take that kind of risk. But don't go in assuming all you need is a loan and you'll be an instant millionaire. You might, but the odds are very long.\"" }, { "docid": "36366", "title": "", "text": "\"This is such a common question here and elsewhere that I will attempt to write the world's most canonical answer to this question. Hopefully in the future when someone on answers.onstartups asks how to split up the ownership of their new company, you can simply point to this answer. The most important principle: Fairness, and the perception of fairness, is much more valuable than owning a large stake. Almost everything that can go wrong in a startup will go wrong, and one of the biggest things that can go wrong is huge, angry, shouting matches between the founders as to who worked harder, who owns more, whose idea was it anyway, etc. That is why I would always rather split a new company 50-50 with a friend than insist on owning 60% because \"\"it was my idea,\"\" or because \"\"I was more experienced\"\" or anything else. Why? Because if I split the company 60-40, the company is going to fail when we argue ourselves to death. And if you just say, \"\"to heck with it, we can NEVER figure out what the correct split is, so let's just be pals and go 50-50,\"\" you'll stay friends and the company will survive. Thus, I present you with Joel's Totally Fair Method to Divide Up The Ownership of Any Startup. For simplicity sake, I'm going to start by assuming that you are not going to raise venture capital and you are not going to have outside investors. Later, I'll explain how to deal with venture capital, but for now assume no investors. Also for simplicity sake, let's temporarily assume that the founders all quit their jobs and start working on the new company full time at the same time. Later, I'll explain how to deal with founders who do not start at the same time. Here's the principle. As your company grows, you tend to add people in \"\"layers\"\". The top layer is the first founder or founders. There may be 1, 2, 3, or more of you, but you all start working about the same time, and you all take the same risk... quitting your jobs to go work for a new and unproven company. The second layer is the first real employees. By the time you hire this layer, you've got cash coming in from somewhere (investors or customers--doesn't matter). These people didn't take as much risk because they got a salary from day one, and honestly, they didn't start the company, they joined it as a job. The third layer are later employees. By the time they joined the company, it was going pretty well. For many companies, each \"\"layer\"\" will be approximately one year long. By the time your company is big enough to sell to Google or go public or whatever, you probably have about 6 layers: the founders and roughly five layers of employees. Each successive layer is larger. There might be two founders, five early employees in layer 2, 25 employees in layer 3, and 200 employees in layer 4. The later layers took less risk. OK, now here's how you use that information: The founders should end up with about 50% of the company, total. Each of the next five layers should end up with about 10% of the company, split equally among everyone in the layer. Example: Two founders start the company. They each take 2500 shares. There are 5000 shares outstanding, so each founder owns half. They hire four employees in year one. These four employees each take 250 shares. There are 6000 shares outstanding. They hire another 20 employees in year two. Each one takes 50 shares. They get fewer shares because they took less risk, and they get 50 shares because we're giving each layer 1000 shares to divide up. By the time the company has six layers, you have given out 10,000 shares. Each founder ends up owning 25%. Each employee layer owns 10% collectively. The earliest employees who took the most risk own the most shares. Make sense? You don't have to follow this exact formula but the basic idea is that you set up \"\"stripes\"\" of seniority, where the top stripe took the most risk and the bottom stripe took the least, and each \"\"stripe\"\" shares an equal number of shares, which magically gives employees more shares for joining early. A slightly different way to use the stripes is for seniority. Your top stripe is the founders, below that you reserve a whole stripe for the fancy CEO that you recruited who insisted on owning 10%, the stripe below that is for the early employees and also the top managers, etc. However you organize the stripes, it should be simple and clear and easy to understand and not prone to arguments. Now that we have a fair system set out, there is one important principle. You must have vesting. Preferably 4 or 5 years. Nobody earns their shares until they've stayed with the company for a year. A good vesting schedule is 25% in the first year, 2% each additional month. Otherwise your co-founder is going to quit after three weeks and show up, 7 years later, claiming he owns 25% of the company. It never makes sense to give anyone equity without vesting. This is an extremely common mistake and it's terrible when it happens. You have these companies where 3 cofounders have been working day and night for five years, and then you discover there's some jerk that quit after two weeks and he still thinks he owns 25% of the company for his two weeks of work. Now, let me clear up some little things that often complicate the picture. What happens if you raise an investment? The investment can come from anywhere... an angel, a VC, or someone's dad. Basically, the answer is simple: the investment just dilutes everyone. Using the example from above... we're two founders, we gave ourselves 2500 shares each, so we each own 50%, and now we go to a VC and he offers to give us a million dollars in exchange for 1/3rd of the company. 1/3rd of the company is 2500 shares. So you make another 2500 shares and give them to the VC. He owns 1/3rd and you each own 1/3rd. That's all there is to it. What happens if not all the early employees need to take a salary? A lot of times you have one founder who has a little bit of money saved up, so she decides to go without a salary for a while, while the other founder, who needs the money, takes a salary. It is tempting just to give the founder who went without pay more shares to make up for it. The trouble is that you can never figure out the right amount of shares to give. This is just going to cause conflicts. Don't resolve these problems with shares. Instead, just keep a ledger of how much you paid each of the founders, and if someone goes without salary, give them an IOU. Later, when you have money, you'll pay them back in cash. In a few years when the money comes rolling in, or even after the first VC investment, you can pay back each founder so that each founder has taken exactly the same amount of salary from the company. Shouldn't I get more equity because it was my idea? No. Ideas are pretty much worthless. It is not worth the arguments it would cause to pay someone in equity for an idea. If one of you had the idea but you both quit your jobs and started working at the same time, you should both get the same amount of equity. Working on the company is what causes value, not thinking up some crazy invention in the shower. What if one of the founders doesn't work full time on the company? Then they're not a founder. In my book nobody who is not working full time counts as a founder. Anyone who holds on to their day job gets a salary or IOUs, but not equity. If they hang onto that day job until the VC puts in funding and then comes to work for the company full time, they didn't take nearly as much risk and they deserve to receive equity along with the first layer of employees. What if someone contributes equipment or other valuable goods (patents, domain names, etc) to the company? Great. Pay for that in cash or IOUs, not shares. Figure out the right price for that computer they brought with them, or their clever word-processing patent, and give them an IOU to be paid off when you're doing well. Trying to buy things with equity at this early stage just creates inequality, arguments, and unfairness. How much should the investors own vs. the founders and employees? That depends on market conditions. Realistically, if the investors end up owning more than 50%, the founders are going to feel like sharecroppers and lose motivation, so good investors don't get greedy that way. If the company can bootstrap without investors, the founders and employees might end up owning 100% of the company. Interestingly enough, the pressure is pretty strong to keep things balanced between investors and founders/employees; an old rule of thumb was that at IPO time (when you had hired all the employees and raised as much money as you were going to raise) the investors would have 50% and the founders/employees would have 50%, but with hot Internet companies in 2011, investors may end up owning a lot less than 50%. Conclusion There is no one-size-fits-all solution to this problem, but anything you can do to make it simple, transparent, straightforward, and, above-all, fair, will make your company much more likely to be successful. The above awesome answer came from the Stack Exchange beta site for startups, which has now closed. I expect that this equity distribution question (which is strongly tied to personal finance) will come up more times in the future so I have copied the content originally posted. All credit for this excellent answer is due to Joel Spolsky, a moderator for the Startups SE beta site, and co-founder of Stack Exchange.\"" }, { "docid": "375423", "title": "", "text": "\"Even though you will meet the physical presence test, you cannot claim the FEIE because your tax home will remain the US. From the IRS: Your tax home is the general area of your main place of business, employment, or post of duty, regardless of where you maintain your family home. Your tax home is the place where you are permanently or indefinitely engaged to work as an employee or self-employed individual. Having a \"\"tax home\"\" in a given location does not necessarily mean that the given location is your residence or domicile for tax purposes. ... You are not considered to have a tax home in a foreign country for any period in which your abode is in the United States. However, your abode is not necessarily in the United States while you are temporarily in the United States. Your abode is also not necessarily in the United States merely because you maintain a dwelling in the United States, whether or not your spouse or dependents use the dwelling. ... The location of your tax home often depends on whether your assignment is temporary or indefinite. If you are temporarily absent from your tax home in the United States on business, you may be able to deduct your away from home expenses (for travel, meals, and lodging) but you would not qualify for the foreign earned income exclusion. If your new work assignment is for an indefinite period, your new place of employment becomes your tax home, and you would not be able to deduct any of the related expenses that you have in the general area of this new work assignment. If your new tax home is in a foreign country and you meet the other requirements, your earnings may qualify for the foreign earned income exclusion. If you expect your employment away from home in a single location to last, and it does last, for 1 year or less, it is temporary unless facts and circumstances indicate otherwise. If you expect it to last for more than 1 year, it is indefinite. If you expect your employment to last for 1 year or less, but at some later date you expect it to last longer than 1 year, it is temporary (in the absence of facts and circumstances indicating otherwise) until your expectation changes. For guidance on how to determine your tax home refer to Revenue Ruling 93-86. Your main place of business is in the US and this will not change, because your business isn't relocating. If you are intending to work remotely while you are abroad, you should get educated on the relevant laws on where you are going. Most countries don't take kindly to unauthorized work being performed by foreign visitors. And yes, even though you aren't generating income or involving anyone in their country, the authorities still well may disapprove of your working. My answer to a very similar question on Expatriates.\"" }, { "docid": "56794", "title": "", "text": "\"Taking out your equity when refinancing means that you take out a new loan for the full value of your house (perhaps less 20% as a down payment on the new mortgage, otherwise you'll be paying insurance), pay off your old lender, and keep the rest for yourself. The result is much the same as using as a HELOC or home equity loan (or a second mortgage), except it's all rolled into a single new mortgage. The advantage is that the interest rate on a first mortgage is going to be lower than on HELOC or equivalent, and the equity requirements may be lower (e.g. a HELOC may only let you borrow against the amount of equity that exceeds 25% or 30%, while a new mortgage will require you only to have 20% equity). This is especially attractive to those whose homes have appreciated significantly since they bought them, especially if they have a lot of high-interest debt (e.g. credit cards) they want to pay off. Of course, rolling credit card debt into a 30-year mortgage isn't actually paying it off, but the monthly payments will be a lot lower, and if you're lucky and your home appreciates further, you can pay it off fully when you sell the property and still have paid a lot less interest. The downside is that you have turned unsecured debt into secured debt, which puts your home at risk if you find yourself unable to pay. In your case, you don't yet have even 20% equity in your home, so I wouldn't recommend this. :-) Equity is simply the difference between the amount you still owe on your home and the amount you'd get if you were to sell it. Until you do sell it, this amount is tentative, based on the original purchase price and, perhaps, an intervening appraisal that shows that the property has appreciated. That is really all that it is and there's nothing magic about it, except that since you own your home, you have equity in it, while as a renter, you would not. It used to be (decades ago, when you needed 20% down to get a mortgage) that selling was the only time you'd be able to do anything with the equity in your home. Now you can \"\"take it out\"\" as described above (or borrow against it) thanks to various financial products. It is sometimes tempting to consider equity roughly equivalent to \"\"profit.\"\" But some of it is your own money, contributed through the down payment, your monthly principal payment, and improvements you have made -- so \"\"cashing out\"\" isn't all profit, it's partly just you getting your own money back. And there are many additional expenses involved in owning a home, such as interest, property taxes, maintenance, utilities, and various fees, not to mention the commissions when you buy or sell, which the equity calculation doesn't consider. Increasing equity reflects that you own a desirable property in a desirable location, that you have maintained and maybe even improved it, that you are financially responsible (i.e., paying your mortgage, taxes, etc.), and that your financial interests are aligned with your neighbors. All those things feel pretty good, and they should. Otherwise, it is just a number that the banks will sometimes let you borrow against. :-)\"" }, { "docid": "30959", "title": "", "text": "\"Disclosure: I don't have an iPhone, so I don't use RobinHood. That being said, I have a less \"\"they're-out-to-get-ya\"\" view of what they're doing. As a small business owner (2 businesses), employees cost the most. If you can create a solid business with few (or no) employees and let robots run it, you will drastically reduce your costs. Joe Polish said it similarly with sales letters, something along the lines of they never complain about a headache, need to take a year off to discover themself, or just need a personal day. Robots are the same; they do not have human limits. Most simple trading can be done and maintained by well written code and AI, there's very little need for humans to do anything other than build it. Think about the efficiency of bitcoin versus all the central banks combined; how many people are employed by central banks? Robinhood states that they are using technology in these ways to minimize costs and they're using a system that doesn't need physical branches (this doesn't mean they will never have them, just that they don't need them). Robinhood does not indicate that they allow everything to happen for free; only stock trading. I worked for a large trading firm once and observed that stock trading wasn't the bulk of where they made their money anyway; trading options, futures, index funds, etc are where the big money was and Robinhood says nothing about those being free. Like the CQM mentioned too, they'll be charging for margin as well. In a way, the individual stock trader is dead; many people - including this forum - prefer index funds, so more than likely, Robinhood will strike up a deal with an index fund company or create their own (this is just easy, passive income with an expense ratio). In this category, the markets are their playground, but they do need to attract enough people to their platform, thus free stock trading is a good way to do it. As for selling your information for advertising, that is always a possibility, but they have quite a few other options that would be good for most investors (index funds, affiliating with financial fund companies, etc) where they can start before ever needing to dip their toe in selling information. This isn't to say they won't do it, but that there are few other options they have. The major concern I have for Robinhood is ongoing security. Just building it and letting it run kind of assumes that there won't be major compromises in the future and as AI evolves, superior AI might be able to crush older AI.\"" }, { "docid": "439349", "title": "", "text": "\"In Italy (even with taxes that are more than 50% on income) owning garages is generally a good business, as you said: \"\"making money while you sleep\"\", because of no maintainance. Moreover garages made by real concrete (and not wood like in US) are still new after 50 years, you just repaint them once every 20 years and you change the metal door gate once every 30 years. After 20 years you can be sure the price of the garage will be higher than what you paied it (at least for the effect of the inflation, after 20 years concrete and labour work will cost more than today). The only important thing before buying it is to make sure it is in an area where people are eager to rent it. This is very common in Italian cities' downtown because they were built in dark ages when cars did not exists, hence there are really few available parkings.\"" }, { "docid": "3750", "title": "", "text": "\"The implication is market irrationality is stronger than market rationality. Aka nothing makes sense when TSLA climbs to $400 or when CMG rises to $750. I wouldn't say there is a systematic flaw in valuation. I think there is just a lot of ignorance. Markets are more open to household investors than ever before. You used to go to your broker and ask him what's up and he'd give you the inside scoop since you pay them money. Now you go onto marketwatch and get some random nobody's opinion on everything and make stock selections based on that. But eventually the chickens come home to roost and things will correct itself. Big players will jump ship and cause signals to other traders to jump ship. The public can pump stocks up pretty high but it doesn't just go to infinity. Eventually someone will stop and say, \"\"wtf is going on\"\" and start selling. Stocks are sold on a basis of a limit order book so it's real prices that people are paying. People don't care about prices currently because most don't have any finance knowledge but want to invest their own money. They just hear about Tesla doing something amazing (from some clickbait article or news outlet) and can't stop thinking about buying Tesla. They go to Chipotle and think \"\"wow this place is so good and hip, they must be a great investment\"\". The markets have been filled with more subjective analysis than ever before especially with so much low quality information at your fingertips. Equally ignorant people startin blogs about investment and personal finance being shepherds for other ignorant people. In the end they all lose. People who exclaim \"\"this stock is going up to $250 easily\"\" with literally zero quantitative analysis or even a baseline reference point to back it up are prime examples of this. Ignorance of markets and cheap money almost always lead to market runs that end catastrophically. Dot com bubble, 1929 market crash, 2008, it's always the same. People who have no business taking loans out or buying on margin or leveraging positions with debt only to get fucked over once things are brought back down to Earth. After 2 runs of QE, we now have cheap money and with everyone being a crier for their personal investment strategy, we now also have rampant ignorance. I don't expect things to last but no one can call the bottom or the top, or else you'd be very very rich. Have a safe portfolio, don't try to time the markets. Have a strategy that hedges against unexpected change, don't try to gamble on this change. Because it's ultimately impossible to predict the movement of every single person on this earth that invests their money into markets. So don't try. Just be prepared. ---- To expand further into valuation theory: at the end of the day, people invest their money to make more money. It's as simple as that. If your money doesn't grow in an investment vehicle, it's ultimately a shit investment. But no one values intrinsic value of a company's equity before they decide whether or not $380 for TSLA is a good/bad deal. As a result, stocks can be pumped up way higher and people still see the gains on their stocks through capital gains fueled by other optimistic investors. Non-zero sum goes both ways. People can make shitloads of money on stock without an equitable loser--people can also lose shitloads on stock without any real winner emerging from the rubble. When this bubble bursts, lots and lots of people will lose money on TSLA when people's expectations become rational and they stop paying $300 a share for a negative or 70 PE ratio. It's insane what multipliers people will pay for these companies without even realizing the implication--if you buy a share of a company with a PE ratio of 70, you just paid 70 times their earnings for a share. In an ideal world where they released every single penny of earnings as dividends, it would take you 70 periods to reclaim your money on that share. This obviously doesn't take into account capital gains, but capital gains aren't supposed to be this irrational to where a stock can be pumped up into 70x PE ratio in the first place. It's a whole messed up web of confusion and irrationality and eventually something will catalyze a reaction. Imagine a market where everyone just agreed to pump up a single stock to infinity and everyone just rakes in shitloads of money. Would this work? Of course not. It's literally a pyramid scheme that relies on future generations to constantly inject capital--no real value is being created by this scheme. It requires constantly more future generations to continue adding money into the scheme and will crash once people stop pumping money into it. The same thing will happen here. Everyone \"\"agreed\"\" to pump up TSLA (in a sense) but eventually people will realize this is stupid as shit and the pyramid will come tumbling down because there is nothing they receive from this scheme other than the money from other people. It's essentially moving money around, making 0 use of it, until people stop pumping money into the system and everyone realizes that nothing of real value had been produced through the use of this money. Ultimately the only thing that creates real value is the money that is returned to shareholders from an outside party--the company you're invested in. Real value is not created when people exchange stock and money. So why do these transactions create higher values in equity? The basis of equity valuation states that dividends are the only way for companies to raise the price of their stock, going off the traditional Dividend Discount Model. And theoretically, that's the only logical explanation. Buying and trading stock does nothing for the company, minus T Stock they might own. Ultimately the only party creating real value is the underlying company. If they aren't creating real value, then their stock should not be increasing, period. The way they create value is by efficiently utilizing assets to generate returns on investment which can be returned to investors through dividends. Dividends can only be increased (while maintaining an equitable payout ratio) by generating more net income that can increase the actual pool of money that can be allocated back to investors. TSLA does not do this. TSLA regularly loses money and overpromises. There is no logical explanation for any of this except that everyone is irrational. Obviously theory is not the same as in practice but the theory is important here because it's really the basis for any investment at all. At the end of the day, a share of stock is the right to a share of the company's equity. People own equity in companies because companies generate money that it returns back to its owners. That's what a company does. That's what an owner does. If you own shares of a company, you're an owner. And if your company does not return more money back to you YoY, then why are you invested in them? Ultimately, you're riding a capital gains wave that will eventually subside once market irrationality succumbs to rationality. And it always does because the real value always catches up to the fake value that is caused by pumping and dumping stocks.\"" }, { "docid": "174693", "title": "", "text": "That's a very good point. As much as I love cars I'd be happy to have the choice of any high end car on demand at the touch of a button, and not have to maintain it or take the hit of depreciation. The insurance premium then will be down to manufacturers or car suppliers, who are probably big enough to run their own insurance schemes. In this scenario perhaps it doesn't bode well for Geico, unless they get into the car business." }, { "docid": "174002", "title": "", "text": "Gold is a commodity. It has a tracked price and can be bought and sold as such. In its physical form it represents something real of signifigant value that can be traded for currency or barted. A single pound of gold is worth about 27000 dollars. It is very valuable and it is easily transported as opposed to a car which loses value while you transport it. There are other metals that also hold value (Platinum, Silver, Copper, etc) as well as other commodities. Platinum has a higher Value to weight ratio than gold but there is less of a global quantity and the demand is not as high. A gold mine is an investement where you hope to take out more in gold than it cost to get it out. Just like any other business. High gold prices simply lower your break even point. TIPS protects you from inflation but does not protect you from devaluation. It also only pays the inflation rate recoginized by the Treasury. There are experts who believe that the fed has understated inflation. If these are correct then TIPS is not protecting its investors from inflation as promised. You can also think of treasury bonds as an investment in your government. Your return will be effectively determined by how they run their business of governing. If you believe that the government is doing the right things to help promote the economy then investing in their bonds will help them to be able to continue to do so. And if consumers buy the bonds then the treasury does not have to buy any more of its own." }, { "docid": "216757", "title": "", "text": "\"Great question! While investing in individual stocks can be very useful as a learning experience, my opinion is that concentrating an entire portfolio in a few companies' stock is a mistake for most investors, and especially for a novice for several reasons. After all, only a handful of professional investors have ever beaten the market over the long term by picking stocks, so is it really worth trying? If you could, I'd say go work on Wall Street and good luck to you. Diversification For many investors, diversification is an important reason to use an ETF or index fund. If they were to focus on a few sectors or companies, it is more likely that they would have a lop-sided risk profile and might be subject to a larger downside risk potential than the market as a whole, i.e. \"\"don't put all your eggs in one basket\"\". Diversification is important because of the nature of compound investing - if you take a significant hit, it will take you a long time to recover because all of your future gains are building off of a smaller base. This is one reason that younger investors often take a larger position in equities, as they have longer to recover from significant market declines. While it is very possible to build a balanced, diversified portfolio from individual stocks, this isn't something I'd recommend for a new investor and would require a substantial college-level understanding of investments, and in any case, this portfolio would have a more discrete efficient frontier than the market as a whole. Lower Volatility Picking individual stocks or sectors would could also significantly increase or decrease the overall volatility of the portfolio relative to the market, especially if the stocks are highly cyclical or correlated to the same market factors. So if they are buying tech stocks, they might see bigger upswings and downswings compared to the market as a whole, or see the opposite effect in the case of utilities. In other words, owning a basket of individual stocks may result in an unintended volatility/beta profile. Lower Trading Costs and Taxes Investors who buy individual stocks tend to trade more in an attempt to beat the market. After accounting for commission fees, transaction costs (bid/ask spread), and taxes, most individual investors get only a fraction of the market average return. One famous academic study finds that investors who trade more trail the stock market more. Trading also tends to incur higher taxes since short term gains (<1 year) are taxed at marginal income tax rates that are higher than long term capital gains. Investors tend to trade due to behavioral failures such as trying to time the market, being overconfident, speculating on stocks instead of long-term investing, following what everyone else is doing, and getting in and out of the market as a result of an emotional reaction to volatility (ie buying when stocks are high/rising and selling when they are low/falling). Investing in index funds can involve minimal fees and discourages behavior that causes investors to incur excessive trading costs. This can make a big difference over the long run as extra costs and taxes compound significantly over time. It's Hard to Beat the Market since Markets are Quite Efficient Another reason to use funds is that it is reasonable to assume that at any point in time, the market does a fairly good job of pricing securities based on all known information. In other words, if a given stock is trading at a low P/E relative to the market, the market as a whole has decided that there is good reason for this valuation. This idea is based on the assumption that there are already so many professional analysts and traders looking for arbitrage opportunities that few such opportunities exist, and where they do exist, persist for only a short time. If you accept this theory generally (obviously, the market is not perfect), there is very little in the way of insight on pricing that the average novice investor could provide given limited knowledge of the markets and only a few hours of research. It might be more likely that opportunities identified by the novice would reflect omissions of relevant information. Trying to make money in this way then becomes a bet that other informed, professional investors are wrong and you are right (options traders, for example). Prices are Unpredictable (Behave Like \"\"Random\"\" Walks) If you want to make money as a long-term investor/owner rather than a speculator/trader, than most of the future change in asset prices will be a result of future events and information that is not yet known. Since no one knows how the world will change or who will be tomorrow's winners or losers, much less in 30 years, this is sometimes referred to as a \"\"random walk.\"\" You can point to fundamental analysis and say \"\"X company has great free cash flow, so I will invest in them\"\", but ultimately, the problem with this type of analysis is that everyone else has already done it too. For example, Warren Buffett famously already knows the price at which he'd buy every company he's interested in buying. When everyone else can do the same analysis as you, the price already reflects the market's take on that public information (Efficent Market theory), and what is left is the unknown (I wouldn't use the term \"\"random\"\"). Overall, I think there is simply a very large potential for an individual investor to make a few mistakes with individual stocks over 20+ years that will really cost a lot, and I think most investors want a balance of risk and return versus the largest possible return, and don't have an interest in developing a professional knowledge of stocks. I think a better strategy for most investors is to share in the future profits of companies buy holding a well-diversified portfolio for the long term and to avoid making a large number of decisions about which stocks to own.\"" }, { "docid": "278729", "title": "", "text": "It's not quite identical, due to fees, stock rights, and reporting & tax obligations. But the primary difference is that a person could have voting rights in a company while maintaining zero economic exposure to the company, sometimes known as empty voting. As an abstract matter, it's identical in that you reduce your financial exposure whether you sell your stock or short it. So the essence of your question is fundamentally true. But the details make it different. Of course there are fee differences in how your broker will handle it, and also margin requirements for shorting. Somebody playing games with overlapping features of ownership, sales, and purchases, may have tax and reporting obligations for straddles, wash sales, and related issues. A straight sale is generally less complicated for tax reporting purposes, and a loss is more likely to be respected than someone playing games with sales and purchases. But the empty voting issue is an important difference. You could buy stock with rights such as voting, engage in other behavior such as forwards, shorts, or options to negate your economic exposure to the stock, while maintaining the right to vote. Of course in some cases this may have to be disclosed or may be covered by contract, and most people engaging in stock trades are unlikely to have meaningful voting power in a public company. But the principle is still there. As explained in the article by Henry Hu and Bernie Black: Hedge funds have been especially creative in decoupling voting rights from economic ownership. Sometimes they hold more votes than economic ownership - a pattern we call empty voting. In an extreme situation, a vote holder can have a negative economic interest and, thus, an incentive to vote in ways that reduce the company's share price. Sometimes investors hold more economic ownership than votes, though often with morphable voting rights - the de facto ability to acquire the votes if needed. We call this situation hidden (morphable) ownership because the economic ownership and (de facto) voting ownership are often not disclosed." } ]

[ { "docid": "41356", "title": "", "text": "Deposit it in a business savings account. The following below show you some options you can choose from. Next you can invest it in the market i.e. shares, bonds etc. If you have a more risky side, can go for peer to peer lending. If you are feeling really lucky and want to invest in the long term, then buy a property as a buy-to-let landlord. There are loads of options, you only need to explore." } ]

[ { "docid": "572654", "title": "", "text": "\"This is \"\"incentive financing\"\". Simply put, the car company isn't in the business of making money by buying government bonds. They're in the business of making money by selling cars. If you are \"\"qualified\"\" from a credit standpoint, and want to buy a $20k car on any given Sunday, you'll typically be offered a loan of between 6% and 9%. Let's say this loan is for three years and you can offer $4000 down payment and/or trade. The required monthly payment on the remaining $16k at the high end of 9% is $508.80, which over 3 years means you'll pay $2,316.64 in interest. Now, that may sound like a good chunk of change, and for the ordinary individual, it is, possibly enough that you decide not to buy today. Now, let's say, all other things being equal, that the company is offering 0.9% incentive financing. Same price, same down payment, same loan term. Your payments over 3 years decrease to $450.64, and over the same loan term you would only pay $222.97 in interest. You save over $2,093.67 in interest over three years, which for you is again a decent chunk of change. Theoretically, the car company's losing that same $2,093.67 in interest by offering this deal, and depending on how it's getting the money it lends you (most financial companies are middlemen, getting money from bond-buying investors who expect a rate of return), that could be a real loss and not just opportunity cost. But, that incentive got you to walk in their door, and not their competitor's. It helped convince you to buy the $20,000 car. The gross margin on that car (price minus direct costs) is typically 20% for the dealer, plus another 20% for the manufacturer, so by giving up the $2,000 on the financing side, the dealer and manufacturer just earned themselves 4 times that much. On top of that, by buying that car, you're committing to buy the parts for the car, a side business with even higher margins, of which the car company gets a pretty big chunk. You may even be required to use dealer service while the car's under warranty in order to keep the warranty valid, another cha-ching. When you get right down to it, the loss from the incentive financing is drowned in the gross profits they make from selling the car to you. Now, in reality, it's a fine balance. The percentages I mentioned are gross margins (EBITDASG&A - Earnings Before Interest, Taxes, Depreciation, Amortization, Sales, General and Administrative costs; basically, just revenue minus direct cost of goods sold). Add in all these side costs and you get a net margin of only about 3.5% of revenue, so your $20k car purchase may only make the car company's stakeholders $700 on the sale, plus slightly higher net margins on parts and service over the life of the car. Because incentive financing is typically only offered through the company's own financing subsidiary, the loss isn't in the form of a cost paid, but simply a revenue not realized, but it can still move a car company from net positive to net negative earnings if the program is too successful. This is why not everyone does it, and not all at the same time; if you're selling enough cars without it, why give away money? Typically, these incentives are offered for two reasons; to clear out old cars or excess inventory, or to maintain ground against a competitor's stronger sales numbers. Keeping cars on a lot ready to sell is expensive, and so is not having your brand driving around on the street turning heads and imprinting their name on the minds of potential customers.\"" }, { "docid": "107108", "title": "", "text": "I've heard this story over and over. It's heartbreaking to hear of people (men and women) who slave to start a company, scrape together the wherewithal to take on 2 or 3 employees, back up the payroll from their own personal money when times are tough and then.. just get stabbed fully in the back by women who milk every last minute out of their entitlement before not coming back. I know they aren't interested in the business and I accept that their first priority is the child. But that doesn't make it any easier on the business owner. Would you take on somebody if you seriously thought this was going to happen? Would any small enterprise ever hire anyone? Equality is a nice idea but it will stifle small and slow growing businesses to the point where the only way to get started will be to take a big loan. And that is not in the interests of the economy at large. There should be a second class of job, which you as a company have to fulfill certain requirements to offer. Low turnover (not profit) for example, maybe under 5 employees too. Basically, a company with little reserve with which to deal with an uncertain absence of a large percentage of its workforce. This second class job should carry with it either a waiver on the sexism discrimination policy (although this is completely insane and unfair to women who aren't interested in babies), a waiver on the ability to dismiss people for falling pregnant (which we kind of have in the UK given that in theory there's no unfair dismissal if it's in the first two years, although woe betide anyone who tries this out and immediately hires a man) or - and here's a wacky fucking idea - *some kind of increased government support in the case of pregnancy*. Stifling small companies by forcing them into penury just because someone wants to have a baby - arguably the most natural thing in the world - is in nobody's interests." }, { "docid": "294822", "title": "", "text": "Disclaimer: I am not Canadian and have no experience with their laws and regulations. There really aren't any safe short term investment options at the moment (with interest rates being close to zero). So, just put the money aside you will need for the car and the computer, maybe on a callable savings account to make at least a few Dollars. Do not take out any loans, it is very unlikely you will earn more than the cost of the loan. You didn't say how much will be left but, unfortunately, it really is not much to go on anyway. Considering that you seem to have enough income to cover your expenses, you could transfer the rest to your RRSP, invest and just forget about it. I suggest to follow this rule of thumb: the growth portion of your portfolio, which for you means equities, should be directly related to the number of years you won't need to touch these funds. 1 year, 0 equity. 2 years, 10%, 3 years, 20%, and so on. What's not in equities, you could put in short term bonds, meaning an average duration of about 3 years. Needless to say, single stocks/bonds are out of question, ideally you can find 2 ETFs, one for stocks and one for bonds, respectively. However, if there is any possibility you did not mention that you could suddenly depend on this money, you have to keep your equity exposure, and thus your potential earnings, low. Just a humble thought: i really don't know your specific situation, my apologies if I'm out of line. Often disability means that you are not capable of doing one particular thing anymore, i.e. work physically. Just maybe you would still be capable to do some other type of work, maybe even from the comfort of your home, that would allow you to generate a certain income (and also keep you busy). I hope this helps. Good luck." }, { "docid": "584304", "title": "", "text": "\"You don't state a long term goal for your finances in your message, but I'm going to assume you want to retire early, and retire well. :-) any other ideas I'm missing out on? A fairly common way to reach financial independence is to build one or more passive income streams. The money returned by stock investing (capital gains and dividends) is just one such type of stream. Some others include owning rental properties, being a passive owner of a business, and producing goods that earn long-term royalties instead of just an immediate exchange of time & effort for cash. Of these, rental property is probably one of the most well-known and easiest to learn about, so I'd suggest you start with that as a second type of investment if you feel you need to diversify from stock ownership. Especially given your association with the military, it is likely there is a nearby supply of private housing that isn't too expensive (so easier to get started with) and has a high rental demand (so less risk in many ways.) Also, with our continued current low rate environment, now is the time to lock-in long term mortgage rates. Doing so will reap huge benefits as rates and rents will presumably rise from here (though that isn't guaranteed.) Regarding the idea of being a passive business owner, keep in mind that this doesn't necessarily mean starting a business yourself. Instead, you might look to become a partner by investing money with an existing or startup business, or even buying an existing business or franchise. Sometimes, perfectly good business can be transferred for surprisingly little down with the right deal structure. If you're creative in any way, producing goods to earn long-term royalties might be a useful path to go down. Writing books, articles, etc. is just one example of this. There are other opportunities depending on your interests and skill, but remember, the focus ought to be on passive royalties rather than trading time and effort for immediate money. You only have so many hours in a year. Would you rather spend 100 hours to earn $100 every year for 20 years, or have to spend 100 hours per year for 20 years to earn that same $100 every year? .... All that being said, while you're way ahead of the game for the average person of your age ($30k cash, $20k stocks, unknown TSP balance, low expenses,) I'm not sure I'd recommend trying to diversify quite yet. For one thing, I think you need to keep some amount of your $30k as cash to cover emergency situations. Typically people would say 6 months living expenses for covering employment gaps, but as you are in the military I don't think it's as likely you'll lose your job! So instead, I'd approach it as \"\"How much of this cash do I need over the next 5 years?\"\" That is, sum up $X for the car, $Y for fun & travel, $Z for emergencies, etc. Keep that amount as cash for now. Beyond that, I'd put the balance in your brokerage and get it working hard for you now. (I don't think an average of a 3% div yield is too hard to achieve even when picking a safe, conservative portfolio. Though you do run the risk of capital losses if invested.) Once your total portfolio (TSP + brokerage) is $100k* or more, then consider pulling the trigger on a second passive income stream by splitting off some of your brokerage balance. Until then, keep learning what you can about stock investing and also start the learning process on additional streams. Always keep an eye out for any opportunistic ways to kick additional streams off early if you can find a low cost entry. (*) The $100k number is admittedly a rough guess pulled from the air. I just think splitting your efforts and money prior to this will limit your opportunities to get a good start on any additional streams. Yes, you could do it earlier, but probably only with increased risk (lower capital means less opportunities to pick from, lower knowledge levels -- both stock investing and property rental) also increase risk of making bad choices.\"" }, { "docid": "266229", "title": "", "text": "\"The HMRC has a dedicated self-help/learning site that is helpful here: It's important to tell HMRC that you are self-employed as soon as possible. If you don't, you may have to pay a penalty. You don't want to pay more to HMRC than you have to as it is a waste of your money. Your business has started when you start to advertise or you have a customer to buy your goods or services. It is at this point that your business is 'trading'. You cannot register before you start trading. For example, if you advertise your business in the local newspaper on 15 January but do not get your first customer until 29 March; in this case, you have been trading since 15 January. You must tell HMRC within six months of the end of the tax year in which you start self-employment. You must therefore register by 5 October. But it's best to register well before this so that you do not forget to do so. The HMRC also has a YouTube channel with help videos, and \"\"Am I Trading or Not?\"\" might be of particular interest to you. Most of the registration is based around the concept of starting to work with the intent to make a profit. By the letter of law and regulations, you should register within six months of the end of the tax year you started to avoid any potential penalty. However note that the situation is different based upon your intent. If you begin making/putting up videos online as a hobby with the hope that you can make something to help you defray the basic costs involved, and the total amount you make is relatively small (say, less than 500 pounds), you will not be classified as \"\"trading\"\" and likely have no need to register with HMRC. As soon as you begin to get in regular payments, maybe a single payment of a significant size, or multiple payments for a similar service/item, you are vastly more likely to need to register. From my reading you would likely be safe to begin putting up videos without registration, but if you begin spending a large portion of your time over an extended period (multiple months) and/or begin getting payments of any notable size then you should likely register with the appropriate services (HMRC, etc). As is the case in both the USA and UK, simple registration is pretty cheap and the costs of little/no income are usually pretty minor. Also note that the HMRC trading and self-employment regulations are unusual compared to many US laws/institutions, in that you are explicitly permitted to begin doing something and only register later. So if you start doing videos for an entire tax year + 5 months and make nothing significant, you'd seemingly be fine to never register at all.\"" }, { "docid": "591909", "title": "", "text": "As stated in the comments, Index Funds are the way to go. Stocks have the best return on investment, if you can stomach the volatility, and the diversification index funds bring you is unbeatable, while keeping costs low. You don't need an Individual Savings Account (UK), 401(k) (US) or similar, though they would be helpful to boost investment performance. These are tax advantaged accounts; without them you will have to pay taxes on your investment gains. However, there's still a lot to gain from investing, specially if the alternative is to place them in the vault or similar. Bear in mind that inflation makes your money shrink in real terms. Even a small interest is better than no interest. By best I mean that is safe (regulated by the financial authorities, so your money is safe and insured up to a certain amount) and has reasonable fees (keeping costs low is a must in any scenario). The two main concerns when designing your portfolio are diversification and low TER (Total Expense Ratio). As when we chose broker, our concern is to be as safe as we possibly can (diversification helps with this) and to keep costs at the bare minimum. Some issues might restrict your election or make others seem better. Depending on the country you live and the one of the fund, you might have to pay more taxes on gains/dividends. e.g. The US keeps some of them if your country doesn't have a special treaty with them. Look for W-8Ben and tax withholding for more information. Vanguard and Blackrock offer nice index funds. Morningstar might be a good place for gathering information. Don't trust blindly the 'rating'. Some values are 'not rated' and kick ass the 4 star ones. Again: seek low TER. Not a big fan of this point, but I'm bound to mention it. It can be actually helpful for sorting out tax related issues, which might decide the kind of index fund you pick, and if you find this topic somewhat daunting. You start with a good chunk of money, so it might make even more sense in your scenario to hire someone knowledgeable and trustworthy. I hope this helps to get you started. Best of luck." }, { "docid": "484414", "title": "", "text": "Because so many businesses make some money through some form of compound interest, like a business that saves its earnings in a business account that pays interest, it heavily depends on how strict you interpret this law. Some Muslims I know interpret it to mean directly and indirectly, while for some it's just direct interest earned. What I would suggest is either a direct investment in agriculture or a share in agriculture, where you are directly paid from your share in the investment and not through money that comes from a bank account earning interest. If you do a direct investment in agriculture, like owning livestock, you will be paid money in the form of food, which compounds through reproduction and can sell the offspring to others and collect the money. Year to date, agriculture is crushing the S&P 500 and many places around the world are facing shortages in food, like sugar and corn. If you don't have enough money for a direct investment, you can try the share route where you own a share of a direct investment. Rather than go through stock exchanges, where many of these companies make money indirectly through interest also, you can negotiate directly with farmers, ranchers, livestock owners, etc. Some of these individuals are looking to diversify their money, so they may be willing to let you own a fraction of what they produce and pay you directly. All of this comes with risk, of course. Livestock and plants die for a variety of reasons, but none of it will be interest from lending whether to individuals or through a bank. In addition, if we experience very high inflation in the future, livestock and plants do very well in this environment." }, { "docid": "328477", "title": "", "text": "\"Don't do it until you have educated yourself enough to know what you are doing. I hope you won't take this personally, but given that you are wandering around asking random strangers on the Internet how to \"\"get into investing,\"\" I feel safe in concluding that you are by no means a sophisticated enough investor to be choosing individual investments, nor should you be trusting financial advisors to choose investments for you. Believe me, they do not have your interests at heart. I usually advise people in your position to start by reading one book: A Random Walk Down Wall Street by Burton Malkiel. Once you've read the book by Malkiel you'll understand that the best strategy for all but the most sophisticated investors is to buy an index fund, which simply purchases a portfolio of ALL available stocks without trying to pick winners and losers. The best index funds are at Vanguard (there is also a Vanguard site for non-US residents). Vanguard is one of the very, very, very few honest players in the business. Unlike almost any other mutual fund, Vanguard is owned by its investors, so it has no profit motive. They never try to pick individual stocks, so they don't have to pay fancy high-priced analysts to pick stocks. If you find it impossible to open a Vanguard account from wherever you're living, find a local brokerage account that will allow you to invest in the US stock market. Many Vanguard mutual funds are available as ETFs which means that you buy and sell them just like any other stock on the US market, which should be easy to do from any reasonably civilized place.\"" }, { "docid": "477603", "title": "", "text": "How is the business organized? If as a General Partnership or LLC that reports as a partnership, you will be getting distributed to you each year your % ownership of the earnings or loss. But note, this is a paperwork transfer on the form K-1, which must then carryover to your tax return, it does not require the transfer of cash to you. If organized as an S-Corp, you should be holding shares of the company that you may sell back to the S-Corp, generally as outlined in the original articles of incorporation. The annual 'dividend' (earnings remaining after all expenses are paid) should be distributed to you in proportion to the shares you hold. If a C-Corp and there is only one class of stock that you also hold a percentage of, the only 'profits' that must be distributed proportionally to you are declared dividends by the board of directors. Most family run business are loosely formed with not much attention paid to the details of partnership agreements or articles of incorporation, and so don't handle family ownership disputes very well. From my experience, trying to find an amicable settlement is the best...and least expensive....approach to separation from the business. But if this can't be done or there is a sizable value to the business, you may have to get your own legal counsel." }, { "docid": "94792", "title": "", "text": "\"Remember that \"\"earned\"\" means \"\"earned in profit.\"\" A company like LinkedIn may not be trying to earn any profit, because they believe that they are at the stage in their development where the best thing to do with excess cash is to reinvest it in growing the business. Therefore, profit may not be the best metric at this stage in the company's life cycle.\"" }, { "docid": "431799", "title": "", "text": "\"Safe short term and \"\"pay almost nothing\"\" go hand in hand. Anything that is safe for the short term will not pay much in interest/appreciation. If you don't know what to do, putting it in a savings account is the safest thing. The purpose of that isn't to earn money, it's just to store the money while you figure out where to move it to earn money.\"" }, { "docid": "77142", "title": "", "text": "\"#####&amp;#009; ######&amp;#009; ####&amp;#009; Section 35. [**European tax avoidance**](https://en.wikipedia.org/wiki/Starbucks#European_tax_avoidance) of article [**Starbucks**](https://en.wikipedia.org/wiki/Starbucks): [](#sfw) --- &gt;In October 2012, Starbucks faced criticism after a [Reuters](https://en.wikipedia.org/wiki/Reuters) investigation found that the company reportedly paid only £8.6 million in [corporation tax](https://en.wikipedia.org/wiki/Corporation_tax) in the UK over 14 years, despite generating over £3 billion in sales—this included no tax payments on £1.3 billion of sales in the three years prior to 2012. It is alleged that Starbucks was able to do this by charging high licencing fees to the UK branch of the business, allowing them to declare a £33 million loss in 2011. The UK subsidiary pays [patent fees](https://en.wikipedia.org/wiki/Patent_fee) to the USA subsidiary, purchases coffee beans from the Netherlands subsidiary (where corporation tax is lower than in the UK), and uses the Swiss subsidiary for other \"\"miscellaneous services\"\". A [YouGov](https://en.wikipedia.org/wiki/YouGov) survey suggested that Starbucks' brand image was substantially weakened by the controversy surrounding how much tax it pays in the UK several weeks after the allegations surfaced. &gt; --- ^Interesting: [^Michael ^Majalahti](https://en.wikipedia.org/wiki/Michael_Majalahti) ^| [^Hear ^Music](https://en.wikipedia.org/wiki/Hear_Music) ^| [^Kara ^Thrace](https://en.wikipedia.org/wiki/Kara_Thrace) ^Parent ^commenter ^can [^toggle ^NSFW](http://www.np.reddit.com/message/compose?to=autowikibot&amp;subject=AutoWikibot NSFW toggle&amp;message=%2Btoggle-nsfw+ck06iea) ^or[](#or) [^delete](http://www.np.reddit.com/message/compose?to=autowikibot&amp;subject=AutoWikibot Deletion&amp;message=%2Bdelete+ck06iea)^. ^Will ^also ^delete ^on ^comment ^score ^of ^-1 ^or ^less. ^| [^(FAQs)](http://www.np.reddit.com/r/autowikibot/wiki/index) ^| [^Mods](http://www.np.reddit.com/r/autowikibot/comments/1x013o/for_moderators_switches_commands_and_css/) ^| [^Magic ^Words](http://www.np.reddit.com/r/autowikibot/comments/1ux484/ask_wikibot/)\"" }, { "docid": "255101", "title": "", "text": "\"(Disclaimer: I am not an accountant nor a tax pro, etc., etc.) Yes, a Canadian corporation can function as a partial income tax shelter. This is possible since a corporation can retain earnings (profits) indefinitely, and corporate income tax rates are generally less than personal income tax rates. Details: If you own and run your business through a corporation, you can choose to take income from your corporation in one of two ways: as salary, or as dividends. Salary constitutes an expense of the corporation, i.e. it gets deducted from revenue in calculating corporate taxable income. No corporate income tax is due on money paid out as salary. However, personal income taxes and other deductions (e.g. CPP) would apply to salary at regular rates, the same as for a regular employee. Dividends are paid by the corporation to shareholders out of after-tax profits. i.e. the corporation first pays income tax on taxable income for the fiscal year, and resulting net income could be used to pay dividends (or not). At the personal level, dividends are taxed less than salary to account for tax the corporation paid. The net effect of corporate + personal tax is about the same as for salary (leaving out deductions like CPP.) The key point: Dividends don't have to be paid out in the year the money was earned. The corporation can carry profits forward (retained earnings) as long as it wants and choose to issue dividends (or not) in later years. Given that, here's how would the partial income tax shelter works: At some point, for you to personally realize income from the corporation, you can have the corporation declare a dividend. You'll then have to pay personal income taxes on the income, at the dividend rates. But for as long as the money was invested inside the corporation, it was subject only to lesser corporate tax rates, not higher personal income tax rates. Hence the \"\"partial\"\" aspect of this kind of tax shelter. Or, if you're lucky enough to find a buyer for your corporation, you could qualify for the Lifetime Capital Gains Exemption on proceeds up to $750,000 when you sell a qualified small business corporation. This is the best exit strategy; unfortunately, not an easy one where the business has no valuable assets (e.g. a client base, or intellectual property.) * The major sticking-point: You need to have real business revenue! A regular employee (of another company) can't funnel his personally-earned employment income into a corporation just to take advantage of this mechanism. Sorry. :-/\"" }, { "docid": "21957", "title": "", "text": "\"I don't understand the OP's desire \"\" I'd love to have a few hundred dollars coming in each month until I really get the hang of things. \"\" When growing your wealth so that it will be large enough in retirement to throw off enough profits to live on ... you must not touch the profits generated along the way. You must reinvest them to earn even more profits. The profits you earn need not show up as 'cash'. Most investments also grow in re-sale value. This growth is called capital gains, and is just-as/more important than cash flows like interest income or dividends. When evaluating investing choices, you think of your returns as a percent of your total savings at any time. So expecting $100/month equals $1,200/year would require a $12,000 investment to earn 10%/yr. From the sounds of it the OP's principal is not near that amount, and an average 10% should not be expected by an investment with reasonable risk. I would conclude that 'There is no free lunch'. You need to continually save and add to your principal. You must invest to expect a reasonable return (less than 10%) and you must reinvest all profits (whether cash or capital gains). Or else start a business - which cannot be compared to passive investing.\"" }, { "docid": "136427", "title": "", "text": "\"A checking account almost never earns any significant interest. A checking accounts often does not have any limits in terms of how many times you can draw funds from it. A checking account often comes with a debit card allowing you to pay online, draw cash from an ATM machine etc. A savings accounts has much higher yields, so you should be getting a decent interest. Unfortunately in the current climate this is not always true (especially not with the big banks) so you may want to look into a high-yield savings account. A savings account is often limited in terms of number of transactions, meaning you can't constantly draw funds from it, it must be stable. A savings account often does not come with a debit card. No, a savings account should not be used for regular transactions. It's an account to park your money for a medium/long time. Understand that banks loan out the money in your savings account to third-parties, so if it would constantly fluctuate, they can't have this money available to others. In return of you parking your money with your bank, you should get a nice return (interest). Yes, but it's not common. Assuming you are from USA, passing banking data (account number and routing number) to third-parties is not safe. In Europe it's totally safe to share your account number to accept money. Depends, some banks do charge fees, some don't. Often there are fees when you're not using the account (no transactions), or when you don't have a certain minimum in an account. Assuming you are American (please specify this information clearly in future) I would look into an \"\"internet bank\"\", like Ally. They don't have many fees and they have an excellent high-yield savings account. They also give you a debit card. Disadvantage is that they don't have physical branches.\"" }, { "docid": "501107", "title": "", "text": "Buying assets doesn't affect your profit, because the money stays on your balance sheet as capital assets instead of cash in bank (unless your tax authorities let you report your accounts on a cashflow basis, which for example they do for very small businesses in the UK). You need to actually spend the money on something you can't turn back to cash later for it to reduce your profit." }, { "docid": "217727", "title": "", "text": "\"The simplest, most convenient way I know of to \"\"move your savings to Canada\"\" is to purchase an exchange-traded fund like FXC, the CurrencyShares Canadian Dollar Trust, or a similar instrument. (I identify this fund because I know it exists, not because I particularly recommend it.) Your money will be in Canadian currency earning Canadian interest rates. You will pay a small portion of that interest in fees. Since US banks are already guaranteed by the FDIC up to $250,000 per account, I don't really think you avoid any risks associated with the failure of an individual bank, but you might fare better if the US currency is subject to inflation or unfavorable foreign-exchange movements - not that such a thing would be a direct risk of a bank failure, but it could happen as a result of actions taken by the Federal Reserve under the auspices of aiding the economy if the economy worsens in the wake of a financial crisis - or, for that matter, if it worsens as a result of something else, including legislative, regulatory, or executive policies. Read the prospectus to understand additional risks with this investment. One of them is foreign-exchange risk. If the US economy and currency strengthen relative to the Canadian economy and its currency, you may lose substantial amounts of purchasing power. Additionally, one of the possible results of a financial crisis is a \"\"flight to safety\"\"; the global financial markets still seem to think the US dollar is pretty safe, and they may bid it up as they have done in the past, resulting in losses to your position (at least in the short term). I do not personally recommend moving all your savings to Canada, especially if it deprives you of income from more profitable investments over the long term, but moving some of your savings to Canada at least isn't a stupid idea, and it may turn out to be somewhat profitable. Having some Canadian currency is also a good idea if you plan to spend the money that you are saving on Canadian goods in the intermediate future.\"" }, { "docid": "107564", "title": "", "text": "I found some UK personal accounts offer up to 3% interest (no names here, but it is well known bank with red logo). You can take out directors loan from your company, put the cash into that personal account and earn interest. Just don't forget to return this loan before end of financial year, so this interest does not become your dividends." }, { "docid": "299752", "title": "", "text": "\"Yes. You do have to pay taxes in the UK as well but it depends on how much you have already been taxed in the US. http://taxaid.org.uk/situations/migrant-workernew-to-the-uk/income-from-abroad-arising-basis-vs-remittance-basis Say, you have to pay 20% tax in the UK for your earnings here. You ARE required to pay the same percentage on your foreign income as well. Now, if your \"\"home\"\" country already taxed you at 10% (for the sake of example), then you only need to pay the \"\"remaining\"\" 10% in the UK. However, the tax law in the UK does allow you to choose between \"\"arising\"\" basis and \"\"remittance\"\" basis on your income from the country you are domiciled in. What I have explained above is based on when income \"\"arises.\"\" But the laws are complicated, and you are almost always better off by paying it on \"\"arising\"\" basis.\"" } ]

[ { "docid": "107564", "title": "", "text": "I found some UK personal accounts offer up to 3% interest (no names here, but it is well known bank with red logo). You can take out directors loan from your company, put the cash into that personal account and earn interest. Just don't forget to return this loan before end of financial year, so this interest does not become your dividends." } ]

[ { "docid": "523415", "title": "", "text": "Avoiding tobacco, etc is fairly standard for a fund claiming ethical investing, though it varies. The hard one on your list is loans. You might want to check out Islamic mutual funds. Charging interest is against Sharia law. For example: http://www.saturna.com/amana/index.shtml From their about page: Our Funds favor companies with low price-to-earnings multiples, strong balance sheets, and proven businesses. They follow a value-oriented approach consistent with Islamic finance principles. Generally, these principles require that investors avoid interest and investments in businesses such as liquor, pornography, gambling, and banks. The Funds avoid bonds and other conventional fixed-income securities. So, it looks like it's got your list covered. (Not a recommendation, btw. I know nothing about Amana's performance.) Edit: A little more detail of their philosophy from Amana's growth fund page: Generally, Islamic principles require that investors share in profit and loss, that they receive no usury or interest, and that they do not invest in a business that is prohibited by Islamic principles. Some of the businesses not permitted are liquor, wine, casinos, pornography, insurance, gambling, pork processing, and interest-based banks or finance associations. The Growth Fund does not make any investments that pay interest. In accordance with Islamic principles, the Fund shall not purchase conventional bonds, debentures, or other interest-paying obligations of indebtedness. Islamic principles discourage speculation, and the Fund tends to hold investments for several years." }, { "docid": "400779", "title": "", "text": "The UK doesn't tax gifts or wealth, so you don't have to pay any tax on your existing savings or the money your parents transfer you. If your parents lived in the UK then you might be potentially liable to inheritance tax on the money if they died less than seven years after giving it to you, but if they live in Japan this won't be relevant. In theory you might have to pay tax on any interest received in the bank account while you live in the UK. However this is likely to be very small, and if you don't have any other income then it's highly unlikely this would apply, as you can get up to £16,000 of interest without paying tax: https://www.gov.uk/apply-tax-free-interest-on-savings/how-much-tax-you-pay" }, { "docid": "590775", "title": "", "text": "In Australia, any income you earn is taxable despite where it came from. Using your example your taxable income is $70,000. Keep in mind that with a business even as a sole trader any business expenses that contribute to the earning of your business income is deductible, reducing the final amount of tax you'll have to pay. The ATO website has lots of good information and examples to look at including tax rates. If your total income is pushing into a higher tax bracket over 30c tax per $1 earned, it may be worth looking at shifting your business to operate under a company structure that just has a fixed tax rate around 30c per $1. That said, for me, I don't want the paperwork overhead of a company yet so I'm running my side business as a sole trader too. I'd rather do that and keep it easy for now while my business gets profitable that waste time on admin structures for tax reasons even if in the shortterm it may mean slightly higher tax. In the end, you only pay tax on profit (income minus expenses) as opposed to raw/gross income. For more info there are good books in the bookshops or local library (to read free) on starting a business on the side while still working. They discuss these issues too." }, { "docid": "466460", "title": "", "text": "**Have a business plan.** Even if this is just a piece of paper that you and your friend scratched on, you want a document that describes what you're going to do and how you're going to do it. Also have some note of how profits will be shared (most likely, this will be 50/50 but write it down!) **Plan ahead and have some cash onhand.** Not every one of your expenses will be something you will know about in advance. Plan your expenses so that you have money to cover them, but also have an emergency fund (you can build this with the profits you get in the beginning) in case your rake breaks and you don't have a backup. Also, if you use your emergency fund, REPLACE IT. **Trust each other and communicate.** All businesses should run on trust. You and your friend should trust that the other person is going to work hard and put in the work. If you don't trust that he will show up on time, the burden falls to you and you will need to work harder. If you're having problems with him, trust that you'll be able to approach him (be tactful and respectful though) and work it out. **Have fun.** Ultimately, starting a business like this should be fun. Yes, the work may seem like a drag, but if you and your friend are able to have fun while working you'll enjoy it more and it won't seem so bad. Also, don't be afraid to spend your profits on yourselves. I'm not saying blow every dollar you make, but going to dinner or going to see a movie together with your hard earned profits from that day's work can make it all worth it. These are just some ideas that I came up with at my desk at work. If you have any other questions, feel free to PM me. I'm happy to help out. Good luck!" }, { "docid": "391657", "title": "", "text": "&gt; To be honest we are probably wrong in trying to tax foreign earnings. [We only tax foreign earnings when the money is repatriated to the US](http://www.taxpolicycenter.org/briefing-book/how-does-current-system-international-taxation-work). You think businesses should be able to go to the Bahamas, sell vast property to another American, and return the profit to the US tax free? &gt; The US should learn the get on with less. I'm all for discussing that idea. Cut the spending before you talk about cutting the taxes that fund it." }, { "docid": "128465", "title": "", "text": "Credit is very important even if you are wealthy. One thing you may not realize is that rich people typically have comparatively little cash on hand. If they're smart, most of their assets are not liquid - they're tied up in safe, long-term investments. They use credit for their day-to-day expenses and pay it off from the dividends on their investments (which might only come in once a quarter). There are also tax advantages to using credit. If a rich person wanted a new car, he'd be smarter leasing it for his business (immediate write-off of the lease payments on taxes) versus buying it (depreciation over several years plus property tax liability in some states). There are more elaborate tax dodges but the point is that buying a car outright is the worst option in terms of tax avoidance. Another way the rich (mis) use credit is so that they don't risk their own money on business ventures. Let's say I have $1,000,000 in my personal bank account, and I want to buy a business that costs $1M. If I am dumb, I clean out my bank account and put all my money in the business. I get 100% of the profits, but I also bear 100% of the risk. If I'm smart, I loan 200K of my own money in the business and put the rest someplace safe, and get a loan from a bank for the other 800K. If the business succeeds, the bank gets their money back plus interest. If it fails, the business declares bankruptcy and the bank eats the 800k loss. If I structured the debt right, my personal loan to the failed business gets paid back first when the company is liquidated, and the bank gets whatever is left over (if anything). The most of my own money I can possibly lose is 200k, and probably it's closer to zero if I have a good accountant." }, { "docid": "266229", "title": "", "text": "\"The HMRC has a dedicated self-help/learning site that is helpful here: It's important to tell HMRC that you are self-employed as soon as possible. If you don't, you may have to pay a penalty. You don't want to pay more to HMRC than you have to as it is a waste of your money. Your business has started when you start to advertise or you have a customer to buy your goods or services. It is at this point that your business is 'trading'. You cannot register before you start trading. For example, if you advertise your business in the local newspaper on 15 January but do not get your first customer until 29 March; in this case, you have been trading since 15 January. You must tell HMRC within six months of the end of the tax year in which you start self-employment. You must therefore register by 5 October. But it's best to register well before this so that you do not forget to do so. The HMRC also has a YouTube channel with help videos, and \"\"Am I Trading or Not?\"\" might be of particular interest to you. Most of the registration is based around the concept of starting to work with the intent to make a profit. By the letter of law and regulations, you should register within six months of the end of the tax year you started to avoid any potential penalty. However note that the situation is different based upon your intent. If you begin making/putting up videos online as a hobby with the hope that you can make something to help you defray the basic costs involved, and the total amount you make is relatively small (say, less than 500 pounds), you will not be classified as \"\"trading\"\" and likely have no need to register with HMRC. As soon as you begin to get in regular payments, maybe a single payment of a significant size, or multiple payments for a similar service/item, you are vastly more likely to need to register. From my reading you would likely be safe to begin putting up videos without registration, but if you begin spending a large portion of your time over an extended period (multiple months) and/or begin getting payments of any notable size then you should likely register with the appropriate services (HMRC, etc). As is the case in both the USA and UK, simple registration is pretty cheap and the costs of little/no income are usually pretty minor. Also note that the HMRC trading and self-employment regulations are unusual compared to many US laws/institutions, in that you are explicitly permitted to begin doing something and only register later. So if you start doing videos for an entire tax year + 5 months and make nothing significant, you'd seemingly be fine to never register at all.\"" }, { "docid": "105781", "title": "", "text": "\"A dividend is a cash disbursement from the company. The value of the company goes down the same amount of the dividend, so it is analogous to having money in a savings account and taking a withdrawal every month. Obviously you are going to have less in the end than if you just kept the money in the account. suppose that I own 10 different stocks, and don't reinvest dividends, but keep them on account, and each month or two, as I add more money to invest, either in one of my existing stocks, or perhaps something new, I add whichever dividend amount is currently available in cash to my new purchase, would this strategy provide the same results? Roughly, yes. Reinvesting dividends is essentially buying more stock at the lower price, which is a net zero effect in total balance. So if you invested in the same stocks, yes you'd be in the same place. If you invested in different stocks, then you would have a performance difference depending on what you invested in. The risk is the temptation to take the cash dividend and not reinvest it, but take it in cash, thereby reducing your earning power. That is, is there some particular reason that the brokers are recommending automatically reinvesting dividends as opposed to reinvesting them manually, perhaps not always in the same item? I'd like to think that they're looking after your best interest (and they might be), but the cynical part of me thinks that they're either trying to keep your business by increasing your returns, or there's some UK regulation I'm not aware of that requires them to disclose the effect of reinvesting dividends. £100 invested in the UK stock market since 1899 would have grown into just £177 after adjusting for inflation. This figure seems ludicrous to me. I haven't actually measured what the historical returns on the \"\"UK market\"\" are, but that would mean an annualized return (adjusted for inflation) of just 0.5%. Either UK stocks pay a ridiculous amount of dividends or there's something wrong with the math. EDIT I still have not found a definitive source for the real UK market return, but according to this inflation calculator, £100 in 1899 would equate to almost £12,000 today, for an average inflation rate of 4.14 percent, which would put the CAGR of the UK market at about 4.9%, which seems reasonable. The CAGR with dividend reinvestment would then be about 9.1%, making dividend reinvestment a no-brainer in the UK market at least.\"" }, { "docid": "328477", "title": "", "text": "\"Don't do it until you have educated yourself enough to know what you are doing. I hope you won't take this personally, but given that you are wandering around asking random strangers on the Internet how to \"\"get into investing,\"\" I feel safe in concluding that you are by no means a sophisticated enough investor to be choosing individual investments, nor should you be trusting financial advisors to choose investments for you. Believe me, they do not have your interests at heart. I usually advise people in your position to start by reading one book: A Random Walk Down Wall Street by Burton Malkiel. Once you've read the book by Malkiel you'll understand that the best strategy for all but the most sophisticated investors is to buy an index fund, which simply purchases a portfolio of ALL available stocks without trying to pick winners and losers. The best index funds are at Vanguard (there is also a Vanguard site for non-US residents). Vanguard is one of the very, very, very few honest players in the business. Unlike almost any other mutual fund, Vanguard is owned by its investors, so it has no profit motive. They never try to pick individual stocks, so they don't have to pay fancy high-priced analysts to pick stocks. If you find it impossible to open a Vanguard account from wherever you're living, find a local brokerage account that will allow you to invest in the US stock market. Many Vanguard mutual funds are available as ETFs which means that you buy and sell them just like any other stock on the US market, which should be easy to do from any reasonably civilized place.\"" }, { "docid": "298680", "title": "", "text": "I feel these beliefs can not be changed so easily. Once someone loses their money, how can you convince him? And on what ground can you convince him? Can you give a guarantee that investments will perform at a certain level? There are many people who are happy with low returns but highly safe instruments. They are not concerned with what you earn in the stock market or the realty market. They are happy not losing their money. I known many people who earned decently during the up-rise of the stock market but all profits were squared up in the downturn and it turned to negative. Such people have their own thinking and such thinking is not out of place. After experience with much turmoil, I feel that they are also right to a great extent. Hence I feel if the person is not getting convinced, you should accept it with greatness." }, { "docid": "168315", "title": "", "text": "Assuming that the financial system broke down, not enough supply of essential commodities or food but there is political and administrative stability and no such chaos that threatens your life by physical attacks. The best investment would then be some paddy fields, land, some cows, chickens and enough clothing , a safe house to stay and a healthy life style that enables you to work for food and some virtue at heart and management skills to get people work for you on your resources so that they can survive with you (may be you earn some profit -that is up to your moral standards to decide, how much). It all begins to start again; a new Financial System has to be in place….!" }, { "docid": "90289", "title": "", "text": "&gt;I was referring to earlier whose large legal department said we were legally safe to hire only christian salesmen and board members. Safe until someone decides to challenge them with a lawsuit. Which they may or may not win. But Title VII is pretty thin legal protection for an insurance company given that they, as you noted, primarily sell insurance. I would think much of the safety comes from economic incentives, or the lack there of for a non-christian salesman. Assuming they are operating in their own interest, no salesman who earns off of commission would want a handicap right out of the gate when dealing with christian customers." }, { "docid": "294822", "title": "", "text": "Disclaimer: I am not Canadian and have no experience with their laws and regulations. There really aren't any safe short term investment options at the moment (with interest rates being close to zero). So, just put the money aside you will need for the car and the computer, maybe on a callable savings account to make at least a few Dollars. Do not take out any loans, it is very unlikely you will earn more than the cost of the loan. You didn't say how much will be left but, unfortunately, it really is not much to go on anyway. Considering that you seem to have enough income to cover your expenses, you could transfer the rest to your RRSP, invest and just forget about it. I suggest to follow this rule of thumb: the growth portion of your portfolio, which for you means equities, should be directly related to the number of years you won't need to touch these funds. 1 year, 0 equity. 2 years, 10%, 3 years, 20%, and so on. What's not in equities, you could put in short term bonds, meaning an average duration of about 3 years. Needless to say, single stocks/bonds are out of question, ideally you can find 2 ETFs, one for stocks and one for bonds, respectively. However, if there is any possibility you did not mention that you could suddenly depend on this money, you have to keep your equity exposure, and thus your potential earnings, low. Just a humble thought: i really don't know your specific situation, my apologies if I'm out of line. Often disability means that you are not capable of doing one particular thing anymore, i.e. work physically. Just maybe you would still be capable to do some other type of work, maybe even from the comfort of your home, that would allow you to generate a certain income (and also keep you busy). I hope this helps. Good luck." }, { "docid": "314342", "title": "", "text": "\"Many individual states, counties, and cities have their own income taxes, payroll taxes, sales taxes, property taxes, etc., you will need to consult your state and local government websites for information about additional taxes that apply based on your locale. Wages, Salaries, Tips, Cash bonuses and other taxable employee pay, Strike benefits, Long-term disability, Earnings from self employment Earned income is subject to payroll taxes such as: Earned income is also subject to income taxes which are progressively higher depending on the amount earned minus tax credits, exemptions, and/or deductions depending on how you file. There are 7 tax rates that get progressively larger as your income rises but only applies to the income in each bracket. 10% for the first 18,650 (2017) through 39.6% for any income above 470,700. The full list of rates is in the above linked article about payroll taxes. Earned income is required for contributions to an IRA. You cannot contribute more to an IRA than you have earned in a given year. Interest, Ordinary Dividends, Short-term Capital Gains, Retirement income (pensions, distributions from tax deferred accounts, social security), Unemployment benefits, Worker's Compensation, Alimony/Child support, Income earned while in prison, Non-taxable military pay, most rental income, and S-Corp passthrough income Ordinary income is taxed the same as earned income with the exception that social security taxes do not apply. This is the \"\"pure taxable income\"\" referred to in the other linked question. Dividends paid by US Corporations and qualified foreign corporations to stock-holders (that are held for a certain period of time before the dividend is paid) are taxed at the Long-term Capital Gains rate explained below. Ordinary dividends like the interest earned in your bank account are included with ordinary income. Stocks, Bonds, Real estate, Carried interest -- Held for more than a year Income from assets that increase in value while being held for over a year. Long term capital gains justified by the idea that they encourage people to hold stock and make long term investments rather than buying and then quickly reselling for a short-term profit. The lower tax rates also reflect the fact that many of these assets are already taxed as they are appreciating in value. Real-estate is usually taxed through local property taxes. Equity in US corporations realized by rising stock prices and dividends that are returned to stock holders reflect earnings from a corporation that are already taxed at the 35% Corporate tax rate. Taxing Capital gains as ordinary income would be a second tax on those same profits. Another problem with Long-term capital gains tax is that a big portion of the gains for assets held for multiple decades are not real gains. Inflation increases the price of assets held for longer periods, but you are still taxed on the full gain even if it would be a loss when inflation is calculated. Capital gains are also taxed differently depending on your income level. If you are in the 10% or 15% brackets then Long-term capital gains are assessed at 0%. If you are in the 25%, 28%, 33%, or 35% brackets, they are assessed at 15%. Only those in the 39.6% bracket pay 20%. Capital assets sold at a profit held for less than a year Income from buying and selling any assets such as real-estate, stock, bonds, etc., that you hold for less than a year before selling. After adding up all gains and losses during the year, the net gain is taxed as ordinary income. Collectibles held for more than a year are not considered capital assets and are still taxed at ordinary income rates.\"" }, { "docid": "77142", "title": "", "text": "\"#####&amp;#009; ######&amp;#009; ####&amp;#009; Section 35. [**European tax avoidance**](https://en.wikipedia.org/wiki/Starbucks#European_tax_avoidance) of article [**Starbucks**](https://en.wikipedia.org/wiki/Starbucks): [](#sfw) --- &gt;In October 2012, Starbucks faced criticism after a [Reuters](https://en.wikipedia.org/wiki/Reuters) investigation found that the company reportedly paid only £8.6 million in [corporation tax](https://en.wikipedia.org/wiki/Corporation_tax) in the UK over 14 years, despite generating over £3 billion in sales—this included no tax payments on £1.3 billion of sales in the three years prior to 2012. It is alleged that Starbucks was able to do this by charging high licencing fees to the UK branch of the business, allowing them to declare a £33 million loss in 2011. The UK subsidiary pays [patent fees](https://en.wikipedia.org/wiki/Patent_fee) to the USA subsidiary, purchases coffee beans from the Netherlands subsidiary (where corporation tax is lower than in the UK), and uses the Swiss subsidiary for other \"\"miscellaneous services\"\". A [YouGov](https://en.wikipedia.org/wiki/YouGov) survey suggested that Starbucks' brand image was substantially weakened by the controversy surrounding how much tax it pays in the UK several weeks after the allegations surfaced. &gt; --- ^Interesting: [^Michael ^Majalahti](https://en.wikipedia.org/wiki/Michael_Majalahti) ^| [^Hear ^Music](https://en.wikipedia.org/wiki/Hear_Music) ^| [^Kara ^Thrace](https://en.wikipedia.org/wiki/Kara_Thrace) ^Parent ^commenter ^can [^toggle ^NSFW](http://www.np.reddit.com/message/compose?to=autowikibot&amp;subject=AutoWikibot NSFW toggle&amp;message=%2Btoggle-nsfw+ck06iea) ^or[](#or) [^delete](http://www.np.reddit.com/message/compose?to=autowikibot&amp;subject=AutoWikibot Deletion&amp;message=%2Bdelete+ck06iea)^. ^Will ^also ^delete ^on ^comment ^score ^of ^-1 ^or ^less. ^| [^(FAQs)](http://www.np.reddit.com/r/autowikibot/wiki/index) ^| [^Mods](http://www.np.reddit.com/r/autowikibot/comments/1x013o/for_moderators_switches_commands_and_css/) ^| [^Magic ^Words](http://www.np.reddit.com/r/autowikibot/comments/1ux484/ask_wikibot/)\"" }, { "docid": "313045", "title": "", "text": "No you will not be taxed for the money in account 2. You have already paid for the tax on the money saved. There is no interest earned on the amount and hence it is not taxed. In UK the interest on ISA [Individual Savings Account] is not taxable as well. Hence you may even transfer the money to account 2 that is an ISA and not a current account." }, { "docid": "276884", "title": "", "text": "The paper is appealing to its readership to consider the profit and loss generated by Starbucks in UK operations as independent of other operations in other countries. Starbucks was profitable in the UK, but they offset these profits with investments in other overseas operations (not UK), to lower their tax rate in the UK. To the Guardian this seems unfair, even though UK law permits this. Seems like there is some case to be made for considering a change in the law." }, { "docid": "403559", "title": "", "text": "I can't comment about your tax liability in Greece. You will have to pay tax on interest in the UK. If you are earning massive amounts of interest, unlikely with the current interest policies from Merv, then you might be bumped up a tier. The receiving bank may ask for proof of the source of the funds, particularly if it is a fair chunk of change." }, { "docid": "259227", "title": "", "text": "\"To summarize your starting situation: You want to: Possible paths: No small business Get a job. Invest the 300K in safe liquid investments then move the maximum amount each year into your retirement accounts. Depending on which company you work for that could include 401K (Regular or Roth), deductible IRA, Roth IRA. The amount of money you can transfer is a function of the options they give you, how much they match, and the amount of income you earn. For the 401K you will invest from your paycheck, but pull an equal amount from the remainder of the 300K. If you are married you can use the same procedure for your spouse's account. You current income funds any vacations or splurges, because you will not need to put additional funds into your retirement plan. By your late 30's the 300K will now be fully invested in retirement account. Unfortunately you can't touch much of it without paying penalties until you are closer to age 60. Each year before semi-retirement, you will have to invest some of your salary into non-retirement accounts to cushion you between age 40 and age 60. Invest/start a business: Take a chunk of the 300K, and decide that in X years you will use it to start a small business. This chunk of money must be liquid and invested safely so that you can use it when you want to. You also don't want to invest it in investments that have a risk of loss. Take the remaining funds and invest it as described in the no small business section. You will completely convert funds to retirement funds earlier because of a smaller starting amount. Hopefully the small business creates enough income to allow you to continue to fund retirement or semi-retirement. But it might not. Comment regarding 5 year \"\"rules\"\": Roth IRA: you have to remain invested in the Roth IRA for 5 years otherwise your withdrawal is penalized. Investing in stocks: If your time horizon is short, then stocks are too volatile. If it drops just before you need the money, it might not recover in time. Final Advice: Get a financial adviser that will lay out a complete plan for a fixed fee. They will discuss investment options, types not particular funds. They will also explain the tax implications of investing in various retirement accounts, and how that will impact your semi-retirement plans. Review the plan every few years as tax laws change.\"" } ]

[ { "docid": "276408", "title": "", "text": "Please consult a tax advisor. You may be voilating the FEMA [Foreign Exchange Management Act] and can land into trouble. Further what you are doing can land up into various other acts as illegal including AML. Further if there is income generated by Indian citizen in India, he is still liable to pay tax, irrespective of whether you get the funds back into India. Edit: AML is Anti Money Laundering. Your transaction is sure to raise AML triggers as it looks like converting Black Money to White in round about way. Once the triggers are raised, RBI division will investigate further to verify what you are doing. If you are able to prove that this is a valid transaction, you would be OK on AML front. How will Income Tax Know? - If they don't know does not mean you are not liable for tax. - Any suspicious transactions would get investigated and sooner or later Income Tax would know about it and can cause a serious problem. - It is irrelevant where you have kept the money, if you have earned something, its taxable. For it not to be taxable you need to conduct this business differently. Please consult a tax adviser who will advice you on the tax-ability of this type of transaction." } ]

[ { "docid": "229454", "title": "", "text": "\"Ah, gotcha. That would be moving the country towards a more socialistic or communistic system where the government controls more of the means of production. I think there would be a problem. Successful companies need to be disruptive and the larger you are the harder it is to try a different approach. I think if the government did try to offer a competing product, the beauracracy would weigh down the offering. The only way the government could be assured a profitable business is to compete unfairly. Consider one of the big government companies, the Post Office. UPS has always been seen as the higher-quality delivery serive. Overnight shipping was considered impossible until FedEx did it. Even today the USPS is in serious financial trouble even though it is granted a monopoly on letter delivery (it is illegal for UPS and FedEx to deliver letters). The Post Office is too inefficient to make money on package delivery so they subsidize that side of their business selling stamps. &gt; so we could abolish income tax and lower taxes over all IMO, the taxes will be paid one way or another. If you cut income tax then it will be replaced with a payroll tax, or sales tax, or property tax, or tariff, or passed to you in the form of higher prices. The only question is the definition of a person or group's \"\"fair share\"\".\"" }, { "docid": "420295", "title": "", "text": "\"I would look into the possibility that the promise \"\"that no taxes will be withheld\"\" is all about your status as a 'consultant'. They may be meaning you to be treated like a business they buy services from. In Canada the distinction is very watery and I presume the same in India. If you agree to become a business, then you must look into how that business income will be taxed.\"" }, { "docid": "52098", "title": "", "text": "If you do go the online route (there's TONS of information out there on how to launch an e-store) make sure you're aware of the caveats. Amazon sellers for example can be shafted pretty hard on returns, as policy generally dictates that you eat the costs. If you don't have a lot of capital this could be back-breaking. Don't let that discourage you, though! You could make a decent business essentially just setting up an online storefront and drop shipping items from elsewhere, which could fund the capital needed to open a brick and mortar shop. To answer your question directly, what everyone else has said is definitely important and correct but don't ignore the smaller things like the fact that you could have a page that presents the items better and makes things look more appealing/luxurious, and the fact that not everyone punches every item they're considering buying into Google to compare. Decent marketing can go a long way (depending on what you're selling, at least)" }, { "docid": "153528", "title": "", "text": "For the financial year 1 April 2014 to 31 March 2015 as you have / will be spending more than 182 days outside of India, you are Non-Resident from tax point of view. For the period 1 April 2014 to Aug 2014, any salary / income you have earned in India is taxable and tax need to be paid. For the period Aug 2014 to 31 March 2015 the income you have earned in Saudi is not taxable in India. You can transfer money to India or keep in Saudi, it has no effect on the taxes. Any interest income you earn, or rental income you earn, or any other source of income in India is taxable. You would need to file returns accordingly. An NRE Accounts allows you to transfer funds out of India without any questions. So if you intend at some point in time in future to move funds out of India [say settling down in Saudi or UK or US etc] it is advisable to have NRE account. If you are sure you don't want to transfer funds out of India, you should open an NRO account." }, { "docid": "152111", "title": "", "text": "with me and my wife coming from different countries, and us both living in a non-native country, we have very little clue where we will eventually settle down. The answer depends on where you reside currently, tax rules and ability to move funds. As well as where you plan to settle down and the tax rules there. From what I understand, once you eventually retire and take an annuity from your pension you are then taxed on it as income anyway? Yes and No. For example if you move from US to India, stay in India for 7 years. You then move your retirement funds from US to India the entire amount would be taxable in India. but would this 'freedom' would come with significant costs in terms of savings at retirement? The cost would be hard to predict. It depends on the tax treatments in the respective countries on the retirement kitty. It also depends on whether the country you are staying in will allow complete withdrawal and transfer of retirement funds without penalty." }, { "docid": "89662", "title": "", "text": "I assume that you are a citizen of India, and are what Indian law calls a NRI (NonResident Indian) and thus entitled to operate an NRE (NonResident External) account in India. You can deposit US dollars into the NRE account, but the money is converted to Indian Rupees (INR) and held as INR. You can withdraw the money and bring it back to the US as US dollars, but the INR will be converted to US$ at the exchange rate applicable on the date of the transaction. With the recent decline of the Indian Rupee against the US dollar, many NRE accounts lost a lot of their value. You can deposit any amount of money in your NRE account. Some banks may limit the amount you can send in one business day, but if 250 times that amount seriously limits the amount of money you want to send each year, you should not be asking here; there are enough expensive lawyers, bankers and tax advisors who will gladly guide you to a satisfactory solution. There is no limitation on the total amount that you can have in your NRE account. The earnings (interest paid) on the sum in your NRE account is not taxable income to you in India but you may still need to file an income tax return in India to get a refund of the tax withheld by the bank (TDS) and sent to the tax authorities. The bank should not withhold tax on the earnings in an NRE account but it did happen to me (in the past). While the interest paid on your NRE account is not taxable in India, it is taxable income to you on your US tax returns (both Federal and State) and you must declare it on your tax return(s) even though the bank will not issue a 1099-INT form to you. Be aware also about the reporting requirements for foreign accounts (FBAR, TD F90-22.1 etc). Lots of people ignored this requirement in the past, but are more diligent these days after the IRS got a truckload of information about accounts in foreign banks and went after people charging them big penalties for not filing these forms for ever so many years. There was a huge ruckus in the Indian communities in the US about how the IRS was unfairly targeting simple folks instead of auditing the rich! But, if the total value of the accounts did not exceed $10K at any time of the year, these forms do not need to be filed. It seems, though, that you will not fall under this exemption since you are planning on having considerably larger sums in your NRE account. So be sure and follow the rules." }, { "docid": "121065", "title": "", "text": "\"If you withdraw 401K then 10% penalty is applied. Also the amount you withdraw is considered as \"\"Income\"\" for that year. Whether you go back to India or Not, the amount is considered Income. Depending on the reason you state during withdraw, the Income tax (default @ 10%) might be \"\"withheld\"\" (Note: Sometime they may not withhold tax). If you are relocating to India, as per international tax rule (between India & US), when filing tax in India then you are supposed to show this as income (the 401K amount) and pay tax according to the total income including amount earned in India (could be upto 30%!!). If there was tax \"\"withheld\"\" in US, you can show it as International tax paid and pay the difference between 10% and your tax rate (upto 30%). If you are relocating to India, but still filing in US (it's possible) then 401K amount will be taxed at US tax rate (could be upto 35%). In either case (filing in India or US) the amount \"\"Withheld\"\" can be shown as tax paid, but yet you will pay the tax difference (could be 20% or 25% more) as per the income for that year. You are not supposed to pay tax in two countries for the same year, as per regulations (might end up with Audit in both country). Hope it helps!\"" }, { "docid": "570639", "title": "", "text": "\"Transferring the money or keeping it in US does has no effect on taxes. Your residency status has. Assuming you are Resident Alien in US for tax purpose and have paid the taxes to IRS and you are \"\"Non-Resident\"\" Indian for tax purposes in India as you are more than 182 outside India. How would it effect my Tax in US and India If you are \"\"Non-Resident\"\" in India for tax purposes, there is no tax liability of this in India. I have transferred an amount of approx 15-20k$ to Indian Account (not NRE) By RBI regulation, if you are \"\"Non-Resident\"\" then you should get your savings account converted to \"\"NRO\"\". You may not may not choose to open an NRE account. To keep the paper work clear it helps that you open an NRE account in India. Any investment needed ? Where do i need to declare if any ? These are not relevant. Note any income generated in India, i.e. interest in Savings account / FDs / Rent etc; taxes need to be paid in India and declared in US and taxes paid in US as well. There is some relief under DTAA. There are quite a few question on this site that will help you clarify what needs to be done.\"" }, { "docid": "558618", "title": "", "text": "What taxes will I have to pay to India? Income earned outside of India when your status is Non-Resident Indian, there is no tax applicable. You can repatriate the funds back to India within 7 years without any tax event. Someone else may put an answer about US taxes." }, { "docid": "476550", "title": "", "text": "Can I transfer directly from my US saving account to their Axis bank in India? Yes you can. any kind of tax my parents need to pay? No. From you parents point of view, its a Gift from their daughter and would come under the provisions of Gift Tax [and Not Income Tax]. Gifts from specified relatives [Daughter /sons /parent /siblings] is tax free. It would make sense to keep some paper work around this, for example a simple letter stating that this is a Gift, specify the amount, the date of transfer, the amount actually credited, details of the credit [Bank Statement]. If there is a scrutiny by income tax, it would ease things. any kind of tax I need to pay? In India NO. In US I am assuming your have already paid tax hence no tax." }, { "docid": "361978", "title": "", "text": "I know that there are a lot service on the internet helping to form an LLC online with a fee around $49. Is it neccessarry to pay them to have an LLC or I can do that myself? No, you can do it yourself. The $49 is for your convenience, but there's nothing they can do that you wouldn't be able to do on your own. What I need to know and what I need to do before forming an LLC? You need to know that LLC is a legal structure that is designed to provide legal protections. As such, it is prudent to talk to a legal adviser, i.e.: a Virginia-licensed attorney. Is it possible if I hire some employees who living in India? Is the salary for my employees a expense? Do I need to claim this expense? This, I guess, is entirely unrelated to your questions about LLC. Yes, it is possible. The salary you pay your employees is your expense. You need to claim it, otherwise you'd be inflating your earnings which in certain circumstances may constitute fraud. What I need to do to protect my company? For physical protection, you'd probably hire a security guard. If you're talking about legal protections, then again - talk to a lawyer. What can I do to reduce taxes? Vote for a politician that promises to reduce taxes. Most of them never deliver though. Otherwise you can do what everyone else is doing - tax planning. That is - plan ahead your expenses, time your invoices and utilize tax deferral programs etc. Talk to your tax adviser, who should be a EA or a CPA licensed in Virginia. What I need to know after forming an LLC? You'll need to learn what are the filing requirements in your State (annual reports, tax reports, business taxes, sales taxes, payroll taxes, etc). Most are the same for same proprietors and LLCs, so you probably will not be adding to much extra red-tape. Your attorney and tax adviser will help you with this, but you can also research yourself on the Virginia department of corporations/State department (whichever deals with LLCs)." }, { "docid": "531306", "title": "", "text": "Can I Send the money back to my personal account of my mother/father in India? Yes you can. Do I need to pay any tax here in US or my parents back in India? There is no tax in India to your parents as it's treated as gift and is tax free between close relatives. In US you would need to pay gift tax if amount is more than USD 16000 a year. See other questions on this site for gift tax rules in US." }, { "docid": "193842", "title": "", "text": "You would need to pay tax on the 10% gain. Was this money loaned from your NRE account? Is there paperwork to show that there was this loan given? If yes then it would be easy to get this back into NRE account. Once in NRE account you can move this back to US without any issue. If not, then you can get this into NRO account. From NRO account you would need to consult a CA to do some paperwork [essentially certifying that you have paid all taxes due] so that funds can be remitted outside. Edit: Looks like you have completed all formalities. A credit to NRE Account can only happen from funds outside of India. However a credit from India into NRE account can happen under some circumstances, like Loan give and received back. You would need a CA in India to help you complete the formalities. The tax is due in India as this was due to gain in India. As you are US resident for tax purposes, and US taxes global income, this is taxable in US as well. You can claim relief in US to the extent of taxes paid in India. India and US have DTAA." }, { "docid": "532259", "title": "", "text": "Can I transfer these money to India in my saving account? What will be tax implication to me? Yes you can. Whether you transfer to India or not does not change your tax obligation. If I understand correctly you are being paid an allowance in UK to cover your expense. If you are saving; then the saving portion is treated as income and you have to self declare this and pay tax according to you tax bracket. Can I transfer these money to my wife's account as a gift? What will be tax implication to me and my wife? There is no tax obligation to your wife. The tax obligation remain same to you as in first point. What if i transfer these money as loan refund to my friend? What will be tax implication for these to me and my friend? If there is proper paper trial to show your friend loaned you a sum at zero percentage and you have paid back; amounts are not to large; then there is no tax obligation to your friend. The tax obligation remains same to you as in point 1." }, { "docid": "84310", "title": "", "text": "After that I moved to the Middle East on March 23rd, 2015 As an NRI, one should not hold any Savings account. Please have this converted to NRO Account. Additionally it is advised that you open an NRE account. Both these can be done remotely. If I transfer money from here to a non NRE/NRO account then is it taxable? Assuming its income earned when you are NRI, it is not taxable. However if there is audit enquiry you would need to have sufficient proof to back that this income is earned during your period as NRI and hence not taxable. As indicate above, holding a savings account when you are NRI is a breach of FEMA regulation. I have been getting mail from myITreturns.com to file income tax returns. Since I am considered as NRI, do I have to fill any non return form online? If there is a source of income in India, interest on savings account etc, it is taxable and you would need to file appropriate returns. Even if you have zero income, it is safe to file a NIL return. For the year 2014 do I have to file income tax returns? For the financial year 1st April 2014 to 31st March 2015, you are still a resident Indian for tax purposes. You should have filed the return by June 2015 if there was tax due, else by March 2016. If you have not done so, please do this ASAP and regularise it." }, { "docid": "353926", "title": "", "text": "Yes, you can still file a 1040nr. You are a nonresident alien and were: engaged in a trade or business in the United States Normally, assuming your withholding was correct, you would get a minimal amount back. Income earned in the US is definitely Effectively Connected Income and is taxed at the graduated rates that apply to U.S. citizens and resident aliens. However, there is a tax treaty between US and India, and it suggests that you would be taxed on the entirety of the income by India. This suggests to me that you would get everything that was withheld back." }, { "docid": "360629", "title": "", "text": "\"Do I need to pay taxes in India in this scenario? For India tax purposes, you would still qualify as \"\"Resident Indian\"\". As a resident Indian you have to pay taxes on Global income. It is not relevant whether you transfer the money back to India to keep in US. The income is generated and taxable. Depending on your contract, presumably you are working as a free lance; certain expenses are allowed to be deducted from your income, for example if you purchase equipment to help carry out the work, stay / entertainment costs, etc. Consult a professional CA who should be able to guide you on what is eligible and what is not. The balance along with your other income will be taxed as per tax brackets. There is exemption for certain category of workers, mostly in entertainment industry where such income is not taxable. This does not apply to your case.\"" }, { "docid": "11654", "title": "", "text": "\"You will need to file a US income tax return, and declare all income world-wide. Whether this results in any tax owed depends on your particular circumstances, and the effect of any tax treaties between the US and India. There are additional requirements for the filing of information on the amounts in foreign accounts held by \"\"US tax persons\"\". Depending on the nature of these accounts, the complexity of the forms, and the penalties for non-compliance can be quite high... Short version: Consult a professional well-qualified in US/India tax matters...\"" }, { "docid": "597865", "title": "", "text": "By earning money, I assume you are being paid a salary [and not allowance] in UK. For the Financial Year 2013-2014: You are still a tax resident in India. India taxes Global income. Hence your salary from 4th Feb to 31st March, needs to be declared as Income. The tax will be at your total tax brackets. India does have a Double Tax Avoidance Treaty [DTAA] with UK, so you can deduct any taxes you paid on this income and pay balance in India. Please note that it is not relevant whether you transfer money to India or keep in UK, it does not change the taxability. For the financial Year 2014-2015: Depending on the exact date, you may or may not be a NRI [away for more than 182 days] for tax purposes. If you are an NRI there no tax, else as above para." } ]

[ { "docid": "269646", "title": "", "text": "I find that there are two violation of law , prima facie , if someone earns money by depositing in the online account and then not reporting it ( including in his total income for the year ) and not bringing in India. Income Tax Act violation 1. It is simply comcealment liable for penalty & prosecution under I.T.Act. 2. You should know that anyone who is resident of India as per income Tax Act and having taxable income ( gross total income exceeding exemption limit) will have to fill up the column in his/her income tax return whether Previously these column were not in the Income Tax Return. So , now anyone who is liable to file return of Income can be tried for false return if he has hiddne assets aborad. 2. FEMA violation RBI permits remittance under Liberalized Remittance Scheme. However this scheme can not be used for certain purpose . It is important to examine whether RBI prohibits use of remittance for any entity or business you have described. You can read following FAQ on RBI site Q. 30. What are the prohibited items under the Scheme? Ans. The remittance facility under the Scheme is not available for the following: i) Remittance for any purpose specifically prohibited under Schedule-I (like purchase of lottery tickets/sweep stakes, proscribed magazines, etc.) or any item restricted under Schedule II of Foreign Exchange Management (Current Account Transactions) Rules, 2000; ii) Remittance from India for margins or margin calls to overseas exchanges / overseas counter-party; iii) Remittances for purchase of FCCBs issued by Indian companies in the overseas secondary market; iv) Remittance for trading in foreign exchange abroad; v) Remittance by a resident individual for setting up a company abroad; vi) Remittances directly or indirectly to Bhutan, Nepal, Mauritius and Pakistan; vii) Remittances directly or indirectly to countries identified by the Financial Action Task Force (FATF) as “non co-operative countries and territories”, from time to time; and viii) Remittances directly or indirectly to those individuals and entities identified as posing significant risk of committing acts of terrorism as advised separately by the Reserve Bank to the banks. You will have to examine , if the remittance was NOT done for purpose not allowed by RBI under LRS . If you clear this , you can say there is no violation and your violation is restricted to I.T.Act only." } ]

[ { "docid": "111131", "title": "", "text": "The key factors here are You will need to pay tax in the UK only if you live more than 183 days - that too in a tax year. Indian tax system will also classify you as a NR (Non-resident) if you live outside for more than 182 days in a tax year. In your case, your income will be in India and will stay in India. So there should not be any UK tax until you try and get that money to the UK. I will not go into outlining what if you want to go down that road since it does not apply. As for tax in India, You will need to pay tax since the source of income is Indian. Hope this helps." }, { "docid": "211485", "title": "", "text": "\"Being self-employed, your \"\"profit\"\" is calculated as all the bills you send out, minus all business-related cost that you have (you will need a receipt for everything, and there are different rules for things that last for long time, long tools, machinery). You can file your taxes yourself - the HRS website will tell you how to, and you can do it online. It's close to the same as your normal online tax return. Only thing is that you must keep receipts for all the cost that you claim. Your tax: Assuming your gross salary is £25,000 and your profits are about £10,000, you will be paying 8% for national insurance, and 20% income tax. If you go above £43,000 or thereabouts, you pay 40% income tax on any income above that threshold, instead of 20%, but your national insurance payments stop.\"" }, { "docid": "360629", "title": "", "text": "\"Do I need to pay taxes in India in this scenario? For India tax purposes, you would still qualify as \"\"Resident Indian\"\". As a resident Indian you have to pay taxes on Global income. It is not relevant whether you transfer the money back to India to keep in US. The income is generated and taxable. Depending on your contract, presumably you are working as a free lance; certain expenses are allowed to be deducted from your income, for example if you purchase equipment to help carry out the work, stay / entertainment costs, etc. Consult a professional CA who should be able to guide you on what is eligible and what is not. The balance along with your other income will be taxed as per tax brackets. There is exemption for certain category of workers, mostly in entertainment industry where such income is not taxable. This does not apply to your case.\"" }, { "docid": "588211", "title": "", "text": "\"(Selling apps is AFAIK business, not freelancing - unless the type of app you produce is considered a freelancing subject. The tax office will give you a questionnaire and then decide). As Einzelunternehmer, you can receive the payments for the apps to the same account where your wages go. However, there are lots of online accounts that do not cost fees, so consider to receive them on a separate account so you have the business and private kind of separate (for small Einzelunternehmer, there is no legal separation between business and private money - you have full liability with your private money for the business). The local chamber of commerce can tell you everything about setting up such a business, ask them (you'll probably have to become a member there anyways). They have information as well on VAT (Umsatzsteuer, USt) which you need to declare unless you get an exemption (probably possible), and about Gewerbesteuer (the income tax of the business) etc. For the tax, you have \"\"subforms\"\" for the income tax e.g. for wages and for business income, so you just submit both with the main form. You'll get an appropriate tax number when registering the business. Social security/insurance: as long as the app selling is only a side business, the social insurance payments for your main job completely cover the side job as well. You need to make sure that your employment contract is compatible with the app business, though. A quick search indicates that there is a tax treaty between Germany and the Ukraine, Wikipedia says there are no contracts about social insurance in effect (yet).\"" }, { "docid": "590267", "title": "", "text": "Apparently it's based on either the address of the seller or vendor or your shipping address; from the AccurateTax.com blog post Destination and Origin Based Sales Tax: ... a few states have laws that are origin-based, where products that are shipped to the customer are taxed based on the location of the business itself. As of this writing, these states are Most states use destination-based sales tax, which defines the source of the transaction to be the destination at which the product will eventually be used, or the address to which the product is shipped. ... The following states [and districts] operate on a destination-based model at the time of this writing: The page Do I Charge Sales Tax or Not? from about.com seems to (somewhat) clarify that if the business is located in a state (or other jurisdiction) with an origin-based sales tax, then they will charge you the sales tax for their state and, presumably, not the sales tax for the state of the shipping address." }, { "docid": "90788", "title": "", "text": "My dad owned a steel Drum / barrel recycling company where we would get barrel from food companies and recondition them. Sometimes we would get drums from one company for free and they would call us to buy drums, many times we would sell them the same drums that we got from them for FREE. That's the beauty of recycling. After some time we started doing plastic drums and we had to find a way to salvage the plastic drums that we were not able to refurbish. So we started contacting plastic companies and started talking to a company in Middle Tennessee. He was a huge plastic processor that was shipping hundreds of thousands tons of plastic regrind every week. He was from India and had a huge plant about 70 miles from Memphis were I was living. He would process the plastic rods or shanks here in the U.S. and ship them too be made into products in India. I was in the process of securing a processing machine from him, one from a company in Northern California, and one from a company in Florida. All three where going to place a processing machine in my dads plant in Memphis and create a coast to coast pipeline with Memphis as the center point. They where going to let us pay for the machinery by paying us to process a percentage of their plastic since much of it was coming through Memphis. That way all they had to do was ship the material once it arrived from our plant. Since Memphis is the gateway to the west and a main truck route it was perfect. This type of arrangement is easy to make if you can convince the major players that you can deliver their product as promised. I also made arrangements with the processor close to me to relocate 2 of his employees to Memphis to manage the equipment until we got failure with the equipment and act as liaison for him. He was agreeing to everything I asked because it would have relieve production pressure off his employees and help him with his bottom line. Make sure you investigate the type of machines you need to process the many types of plastics your processor needs or wants. There are different types of plastics and different ways of processing it. #1 – PET (Polyethylene Terephthalate) ... #2 – HDPE (High-Density Polyethylene) ... #3 – PVC (Polyvinyl Chloride) ... #4 – LDPE (Low-Density Polyethylene) ... #5 – PP (Polypropylene) ... #6 – PS (Polystyrene) I also know that California has a lot of air quality laws. What I would do is get to know your local EPA reps and run your plans by them, they will be able to tell you all you can and can't do. Also you processor is going to want to see your Feasibility Study and business plan before he does this type of arrangement. Once you let me know if this is something that you are still interested in doing I will send you my old business plan. Here is a video to really get an idea of what's involved https://youtu.be/vAr4BZM_Tzk" }, { "docid": "111159", "title": "", "text": "We are India's based online shop . We sell Bags,caps ,belt &amp; buckle collection at very reasonable prices. We have wide range of Bag Accessoires like Messenger Bags, Hversacks, Rucksacks, Backpacks, Laptop Bags, Teens Bags Belt &amp; Buckle Accessoires like CANVAS BELTS,D RING BELTS,CANVAS EYELET BELTS,LEATHER BELTS,BRAIDED BELTS,CANVAS LEATHER BELTS,WOMEN'S BELTS You can browse our online catalogue by visiting our websithttp://www.honeybadgeronline.com and choose from our Stock Items as per your requirements. Our makers will definitely meet your needs. We also provide troupe discount or wholesale discount for reseller. We ship allover india,usa,uk,canada,. For more details Contact Us: Phone - 022-25660522 Mobile - 9820215158 Our Office is located at: 212 TIRUPATI INDUSTRIAL ESTATE BHANDUP VILLAGE ROAD BHANDUP WEST MUMBAI 400078" }, { "docid": "596598", "title": "", "text": "There are lots of different ways to generate passive income. What is Passive Income? Basically it is income you receive without having to consistently work for it i.e. paid to do your day job or get paid by the hour; instead you do the work once and then receive ongoing payments like a recording artist getting paid royalties or a book author etc... Online Passive income Also some online business models can be great ways to generate passive income, you set up an automated system online to drive traffic and sell products either as the merchant or an affiliate and get paid regularly without having to do any more work... You just need to use SEO or PPC or media buys or online advertising to generate the automated traffic to your website which will have special landing pages and sales funnels that do the conversion and selling for you. If you are an affiliate you don't even have to handle any products, packaging, delivering etc... And if it’s a digital product like software or information products they can be sent straight to the customers automatically online then you can set up a system that can generate true passive income. Time consuming or expensive! However the above mentioned methods of generating passive income tend to require a lot of work or special skills, talent or knowledge and can be expensive or time consuming to set up. Preferred Method Therefore for many people the preferred passive income method is fully-managed hands free property investing or other types of investing for that matter. But for people who want full ownership of the income generating asset then property investing is the best as they can sell and have control over the capital invested, whereas investing in a business for example will have a lot of other variables to consider, like the business sector, the market factors, the management team and even down to individual employee performance. So in my opinion, if you have the money to invest then fully-managed hands free buy-to-let property investing is one of the best types of passive income available to us today. Some of the most popular income generating property assets today in the UK include • Student property • Care Homes • Residential buy-to-let" }, { "docid": "446647", "title": "", "text": "I want to send some money to Indian in my saving account but I haven't any NRO/NRE account. It is advisable to Open an NRE account. As an NRI you cannot hold a savings account. Please have this converted into NRO account ASAP. Process or Transaction charges or Tax (levied by Indian bank) on money what I'll send to my saving account in India. I know the process or transaction charges (applied by UK banks) from UK to India. There will be a nominal charge levied by banks in India. If you use dedicated Remittance services [Most Leading Indian Banks offer this], these are mostly free. Is there any limit to get rid off tax? Nope there isn't any limit. This depends on service provider. What types of paper work I'll need to do for showing that income is sent from UK after paying tax. If you transfer to NRE account. There is no paperwork required. It is implicit. If not you have to establish that the funds are received from outside India, keep copies of the transfer request initiated, debits to the Bank Account in UK, your salary slips, Passport stamps etc." }, { "docid": "229454", "title": "", "text": "\"Ah, gotcha. That would be moving the country towards a more socialistic or communistic system where the government controls more of the means of production. I think there would be a problem. Successful companies need to be disruptive and the larger you are the harder it is to try a different approach. I think if the government did try to offer a competing product, the beauracracy would weigh down the offering. The only way the government could be assured a profitable business is to compete unfairly. Consider one of the big government companies, the Post Office. UPS has always been seen as the higher-quality delivery serive. Overnight shipping was considered impossible until FedEx did it. Even today the USPS is in serious financial trouble even though it is granted a monopoly on letter delivery (it is illegal for UPS and FedEx to deliver letters). The Post Office is too inefficient to make money on package delivery so they subsidize that side of their business selling stamps. &gt; so we could abolish income tax and lower taxes over all IMO, the taxes will be paid one way or another. If you cut income tax then it will be replaced with a payroll tax, or sales tax, or property tax, or tariff, or passed to you in the form of higher prices. The only question is the definition of a person or group's \"\"fair share\"\".\"" }, { "docid": "365847", "title": "", "text": "\"I'm not familiar with the law and taxes in India but can provide guidance based on general accounting and tax principles. You are right that receiving money as a loan is not income and isn't liable to income tax. Therefore i suggest you actually formalise this loan through a written contract with your friend. The contract should include all the usual elements of a loan: amount, interest (even if preferential or zero), principal, term, consequences of default and currency of loan. You can then simply state the purpose of transfer as \"\"Personal Loan Agreement\"\". If you have such a document and are questioned by tax authorities you can easily show that the inward remittance is from a loan and should therefore be treated like any commercial loan for tax purposes. As long as you disclose the debt in your tax return (if required in India) and your friend discloses any interest received as income i think you'll be above board and won't be liable for any income tax. To make sure, you might be better off having a quick consultation with an accountant or tax specialist in India to advise you and draft the loan agreement.\"" }, { "docid": "448981", "title": "", "text": "am I allowed to transfer into NRE account from paypal? Credits into NRE accounts are restricted. It has to be established that the funds being credited are income outside of India. In case of paypal, paypal uses local clearing to credit funds into Bank Accounts. So essentially one cannot credit NRE account by domestic clearing network like NEFT. It is best that you withdraw the funds into Bank Account outside India and use SWIFT or remittance service to credit your NRE account. I do not want to transfer to an NRO account since the money credited into it will become taxable. This is not the right assumption. Credits into NRO are not taxable by default; if you establish that the funds are from outside India, there is no tax on the income money transferred from abroad into the NRO account. However, the interest that will be paid by the bank on the balance of the NRO account is taxable income in India and is subject to TDS. In contrast, interest paid on the balance in an NRE account is not taxable in India and is not subject to TDS as long as you maintain NRI status. However it does make sense to keep accounts segregated, i.e. income generated in India, credit the NRO account and income generated outside India credit to NRE." }, { "docid": "11654", "title": "", "text": "\"You will need to file a US income tax return, and declare all income world-wide. Whether this results in any tax owed depends on your particular circumstances, and the effect of any tax treaties between the US and India. There are additional requirements for the filing of information on the amounts in foreign accounts held by \"\"US tax persons\"\". Depending on the nature of these accounts, the complexity of the forms, and the penalties for non-compliance can be quite high... Short version: Consult a professional well-qualified in US/India tax matters...\"" }, { "docid": "77596", "title": "", "text": "From you question I understand that you are not an Indian citizen, are staying in India, and transferring your funds for your living / expenses in India. There is no limit on such transfers and the amount is not taxed. The tax comes into picture if you are treated as a resident in India from a tax perspective. Even then the tax is not because you have transferred the funds into India, but the policy of taxing global income. The article at http://www.pwc.in/en_IN/in/assets/pdfs/foreign-nationals-working-in-india.pdf should give you more inputs." }, { "docid": "339463", "title": "", "text": "If I hire someone in Utah to do sales for me over the phone, and he works out of his home, am I required to register an LLC or file my current one as a foreign entity in Utah? Yes, since you've established presence in Utah. You'll register your current LLC in Utah, no point creating another one. If my sales guy, or I, call businesses in, say, Florida, and sell a few businesses our services for online work like maybe a website design, etc. Are we required to file our LLC In Florida as either a new LLC or a foreign one? No, you need to register where you (your company, including your employees or physical offices) are physically present. You don't need to register in any state you ship products or provide services to. If no-one of your company's employees is present in Florida and you don't have an office/rent a storage there - then you have no presence in Florida. If you actually go there to provide the services - then you do." }, { "docid": "233254", "title": "", "text": "If you are still Indian Citizen for Tax purposes, then all your Global Income is taxable [There are certain exemption if you are in certain professions]. So even if you transfer or not transfer the funds to India, it is taxable in India. If you are getting a per day allowance, its exempt, this has to be looked more as expense reimbursed. If you are saving from per day allowance, well whatever you have save is to be declared as additional income and pay tax accordingly. If you are NRI for tax purposes, there is no limit on the amount of funds that you can send to India. Note that it would help to transfer funds into a separate NRI/NRO account to ensure traceability and ease of taxation." }, { "docid": "241804", "title": "", "text": "my tax liabilities in India on my stock profit in US You would need to pay tax on the profit in India as well after you have become resident Indian. India and US have a double tax avoidance treaty. Hence if you have already paid tax in US, you can claim benefit and pay balance if any. For example if you US tax liability is 20 USD and Indian liability is USD 30, you just need to pay 10 USD. If the Indian tax liability is USD 20 or less you don't need to pay anything. what if in future I transfer all my US money to India? The funds you have earned in US while you were Non-Resident is tax free in India. You can bring it back any-time within a period of 7 years." }, { "docid": "130934", "title": "", "text": "Do I pay tax to the US and then also pay it in India for my income, or does my American partner, who holds 15% of the monthly income, pay tax in the US for his income? Of course you do, what kind of question is this? You have income earned in the US by a US entity, and the entity is taxed. Since LLC is a disregarded entity - the tax shifts to you personally. You should file form 1040NR. You should also talk to a tax professional who's proficient in the Indo-US tax treaty, since it may affect your situation." }, { "docid": "260889", "title": "", "text": "As NRI/PIO (Non-Resident Indian/Person of Indian Origin), the overseas income and transfers in foreign currency are exempt from Indian income taxes. However, the account in India has to be designated NRE or FCNR. There are three kind of accounts that an NRI can maintain Interest earned in NRE and FCNR accounts is exempt from income taxes. Interest earned in NRO accounts is not exempt from income taxes, in fact banks would withhold about 30% of interest (TDS). The exact tax liability would depend upon income generated in India and TDS could be applied towards that liability when the tax returns are filed. There are other implications also of designating the account as NRE or NRO. NRE accounts can only be funded via inward remittance of permitted foreign currency e.g. deposit USD/GBP. So proceeds like rental income, pension etc. that are generated in INR within India can't be deposited in this account. The money deposited in NRE account can grow tax free and can be converted back in any foreign currency freely. On the other hand NRO accounts can be funded through both inward remittance of permitted foreign currency or local income e.g. rental, pension etc. All the amount in this account is treated as Indian originated INR (even if remitted in foreign currency) and thus is taxed as any other bank account. The amount in this account is subject to the annual cap of convertibility of USD 1 million. Both NRE and NRO accounts are maintained in INR and can be Saving and Term Deposit. Any remittance made to these accounts in any foreign currency is converted to INR at the time of deposit and is maintained in INR. FCNR account are held in foreign currency and can only be Term Deposit. Official definitions: Accounts for Non Resident Indians (NRIs) and Persons of Indian Origin (PIOs)" } ]

[ { "docid": "396982", "title": "", "text": "\"Getting a specific service recommendation is off-topic, but the question of what type of professional you need seems on-topic to me. You may be looking for more than one professional in this case, but you could try these to start your search: Different people do things differently, but I think it would be pretty common to have a relationship (i.e. contract, retainer agreement, at least have met the person in case you have an \"\"emergency\"\") with a business law attorney and either a CPA or tax attorney. You may try not to use them too much to keep costs down, but you don't want to be searching for one after you have an issue. You want to know who you're going to call and may establish at least a basis working relationship.\"" } ]

[ { "docid": "248818", "title": "", "text": "Before this agreement, every country had laws on tax-ability of income [including Global incomes]. Quite a few individuals would get away and did not report such income and pay tax if due. In fact quite a few Multi National banks actively created products that helped US Citizens to move money outside and skip reporting. U.S. in order to step up this effort enacted FATCA; essentially as a compliance mechanism, it started with US Head quartered banks operating globally and made reporting mandatory. It stepped up efforts with other countries to ensure foreign banks also enhance reporting of US nationals. See the benefits, quite a few countries joined up together and as part of OECD, came up with CRS. Thus going forward it will enable tax authorities in member countries to exchange financials impacting taxes. The scope is also for Companies / Organization as quite a few Companies hide away income outside the domiciled country. I have heard a rumor that due to the upcoming Common Reporting Standard the details of bank accounts, including all transactions, will be reported all around the industrialized world and want to know if this is true. Yes this is true and it is not a rumor. The exact amount of data and type of data will be agreed between member countries. However a broad framework exists on what needs to be shared. Is it really true that the Common Reporting Standard is going to cause things like this to happen? It is very important to note; There is no new Tax Legislation. Even without FATCA/CRS, a honest tax payer was bound to pay legitimate tax due as per the existing tax provisions of the country along with the provisions of DTAA [Dual Tax Avoidance Agreements]. The CRS only enables monitoring and compliance. So if one was already tax compliant, there is nothing to worry. If one was exploiting the loop hole; how will authorities know ... well this will be curbed going forward. As a note, Canada and Australia will start CRS reporting from 2018." }, { "docid": "366830", "title": "", "text": "First, you should probably have a proper consultation with a licensed tax adviser (EA/CPA licensed in your State). In fact you should have had it before you started, but that ship has sailed. You're talking about start-up expenses. You can generally deduct up to $5000 in the year your business starts, and the expenses in excess will be amortized over 180 months (15 years). This is per the IRC Sec. 195. The amortization starts when your business is active (i.e.: you can buy the property, but not actually open the restaurant - you cannot start the depreciation). I have a couple questions about accounting - should all the money I spent be a part of capital spending? Or is it just a part of it? If it qualifies as start-up/organizational expenses - it should be capitalized. If it is spent on capital assets - then it should also be capitalized, but for different reasons and differently. For example, costs of filing paperwork for permits is a start-up expense. Buying a commercial oven is a capital asset purchase which should be depreciated separately, as buying the tables and silverware. If it is a salary expense to your employees - then it is a current expense and shouldn't be capitalized. Our company is LLC if this matters. It matters to how it affects your personal tax return." }, { "docid": "197782", "title": "", "text": "\"Here's an alternative. There are hundreds, maybe thousands, of contract engineering firms (\"\"job shops\"\") in the United States, probably hundreds in California alone. They are in the business of doing what your \"\"employer\"\" wants you to do, they know how to do it, they have been doing it for decades, working with the biggest, most-established companies in the country. They have forgotten more about providing engineering services to clients, and paying the engineers, than you can learn in a lifetime. Call a few of them. Set up meetings. Budget a few hours for it. You want to talk with the most experienced recruiter in the office, the Old Guy Who Has Been There And Done That. Explain your situation, and tell them that, rather than go through all of the headaches yourself, you want to investigate the possibility of THEM handling all the headaches, for their usual markup of course. (You can probably word this better than I can, but you get the idea.) The shop may or may not be willing to talk about their markup. My personal opinion is that this is perfectly OK. What they make off of you, after your rate is paid, is THEIR business. Also, talk about what you do, and your recommended rate. It would not surprise me to learn that you are currently grossly underpaid. AND, mention that, if the client declines, you're going to be available immediately, and you'd certainly be open to working with them. (You will see this again.) In fact, if they have any current leads that you fit, you would certainly be interested in hearing about them. (They may already have a req from another client, for which you fit, for which the client is willing to pay much more than your current \"\"employer\"\".) If it were me, personally, I'd start with Yoh, Belcan, and maybe TAD Technical. These are three of the oldest and best. I'd also hit up CE Weekly, get a subscription, and find some other shops with offices in your area. Once you have a shop lined up, then ask your \"\"employer\"\" if, rather than you setting up a personal corporation, they'd be willing to work with an established Contract Engineering firm, who does this kind of thing for a living, who does this every day, who has been doing this for decades. Doing this is simpler for everyone, and, by going through an established firm, they avoid having to teach you how to do business with them. They also avoid the risk of having you reclassified by IRS as an employee, which exposes them to all kinds of legal and financial liability. If they say \"\"No\"\", WALK AWAY FROM THEM. Immediately. They've just thrown up a HUGE red flag. This is where the other discussions with the shop come into play.\"" }, { "docid": "271080", "title": "", "text": "Unless they're the actual employers, the I-9 is none of their business. Your employer must verify your eligibility for employment on the first day of your employment, i.e.: when you find a job you'll have to fill I-9 anyway. The only reason I can think for them to do it is to verify that you're eligible for employment before they waste any time on searching for a job for you. I'm not sure if they're legally allowed to ask for your status, so maybe that's their way of working around that. I don't think they can require you to fill I-9, and in fact I'm not sure if its even legal for them to obtain that information without actually being your employers. IMHO, that is, consult with an attorney if you want a proper legal advice." }, { "docid": "316925", "title": "", "text": "HMRC may or may not find out about it; the risks and penalties involved if they do find out make it unwise not to just declare it and pay the tax on it. Based on the fact you asked the question, I am assuming that you currently pay all your tax through PAYE and don't do a tax return. You would need to register for Self Assessment and complete a return; this is not at all difficult if your tax situation is straightforward, which it sounds like yours is. Then you would owe the tax on the additional money, at whatever applicable rate (which depends on how much you earn in your main job, the rate tables are here: https://www.gov.uk/income-tax-rates/current-rates-and-allowances ). If it truly is a one off you could simply declare it on your return as other income, but if it is more than that then you would need to look at setting up as Self Employed - there is some good advice on the differences here: http://www.brighton-accountants.com/blog/tax-self-employment-still-employed/ : Broadly, you are likely to be running a business if you have a regular, organised activity with a profit motive, which continues for at least a few months. If the work is one-off, or very occasional (say, a few times per year), or not very organised, or of very low value (say, under £2,000 per year), then it might qualify as casual income. If you think it is beyond the definition of casual income then you would also need to pay National Insurance, as described in the previous link, but otherwise the tax treatment would be the same." }, { "docid": "535673", "title": "", "text": "From the Massachusetts Department of Revenue: 1st - Massachusetts Source Income That is Excluded Massachusetts gross income excludes certain items of income derived from sources within Massachusetts: non-business related interest, dividends and gains from the sale or exchange of intangibles, and qualified pension income. 2nd - Massachusetts Source Income That is Included: Massachusetts gross income includes items of income derived from sources within Massachusetts. This includes income: 3rd - Trade or business, Including Employment Carried on in Massachusetts: A nonresident has a trade or business, including any employment carried on in Massachusetts if: A nonresident generally is not engaged in a trade or business, including any employment carried on in Massachusetts if the nonresident's presence for business in Massachusetts is casual, isolated and inconsequential. A nonresident's presence for business in Massachusetts will ordinarily be considered casual, isolated and inconsequential if it meets the requirements of the Ancillary Activity Test (AAT) and Examples. When nonresidents earn or derive income from sources both within Massachusetts and elsewhere, and no exact determination can be made of the amount of Massachusetts source income, an apportionment of income must be made to determine that amount considered Massachusetts gross income. 4th - Apportionment of Income: Apportionment Methods: The three most common apportionment methods used to determine Massachusetts source income are as follows: Gross income is multiplied by a: So if you go to Massachusetts to work, you have to pay the tax. If you collect a share of the profit or revenue from Massachusetts, you have to pay tax on that. If you work from Oregon and are paid for that work, then you don't pay Massachusetts tax on that. If anything, your company might have to pay Oregon taxes on revenue you generate (you are their agent or employee in Oregon). Does the answer change depending on whether the income is reported at 1099 or W-2? This shouldn't matter legally. It's possible that it would be easier to see that the work was done in Oregon in one or the other. I.e. it doesn't make any legal difference but may make a practical difference. All this assumes that you are purely an employee or contractor and not an owner. If you are an owner, you have to pay taxes on any income from your Massachusetts business. Note that this applies to things like copyrights and real estate as well as the business. This also assumes that you are doing your work in Oregon. If you live in Oregon and travel to Massachusetts to work, you pay taxes on your Massachusetts income in Massachusetts." }, { "docid": "104448", "title": "", "text": "Since I got downvoted for poking fun at &gt; I've come to realize I don't really enjoy the engineering aspects of my job nor the industry, but I enjoy corporate culture. Here's some info for those actually interested: https://www.wallstreetoasis.com/forums/corporate-strategy-vs-corporate-development https://www.mergersandinquisitions.com/corporate-finance-jobs/ https://www.mergersandinquisitions.com/day-in-life-corporate-finance-analyst/ https://www.quora.com/Strategic-Management-What-is-the-typical-day-in-the-life-of-a-corporate-strategy-consultant https://www.mergersandinquisitions.com/corporate-development-on-the-job/ Corporate finance (Controllers, FP&amp;A, Treasury) is a catch-all for jobs that quantify and manage a company's money. This includes figuring out how much money the business is making, budgeting, and gaining access to money for future plans. They spend most of their day on excel, browsing reddit, and complaining that other departments don't take them seriously. There is work-life balance, unless your company is at risk of bankruptcy, but pay will likely be the least of this group. Corporate strategy/development is about finding ways to achieve the vision/goals of the C-suite. Corporate development usually are ex-IB people and focused on finding companies to acquire, integrate, and achieve the goals of the acquisition (synergies, returns on investment, technology/product acquisition). Corporate strategy is usually broader and could be focused on improving the brand, figuring out new uses for a product, finding new partners, or generally looking for good ideas to improve the company. Business development usually is about growing the company through finding new customers, markets, or partnerships. Instead of selling specific products or services, you're selling your company's abilities and brand. I'd say, with your engineering background, if you can swing a corporate strategy gig, you'd have the greatest opps for any VP you decide. I'd say if you want to sell or are good at selling, then business development may be compelling. If I were you, corporate finance would be the least appealing unless you are truly interested in finance." }, { "docid": "220682", "title": "", "text": "Saving money for the future is a good thing. Whether spending those savings on a business venture makes sense, will depend on a few factors, including: (1) How much money you need that business to make [ie: will you be quitting your job and relying on the business for your sole income? Or will this just be a hobby you make some pocket change from?] (2) How much the money the business needs up front [some businesses, like simple web design consulting, might have effectively $0 in cash startup costs, where starting a franchise restaurant might cost you $500k-$1M on day 1] (3) How risky it is [the general stat is that something like 50% of all new businesses fail in their first year, and I think for restaurants that number is often given as 75%+] But if you don't have a business idea yet, and save for one in the future but never get that 'perfect idea', the good news is that you've saved a bunch of money that you can instead use for retirement, or whatever other financial goals you have. So it's not the saving for a new business that is risky, it's the spending. Part of good personal financial management is making financial goals, tracking your progress to those goals, and changing them as needed. In a simpler case, many people want to own their own home - this is a common financial goal, just like early retirement, or starting your own business, or paying for your kids' college education. All those goals are helped by saving money, so your job as someone mindful of personal finances, is to prioritize those goals in accordance to what is important for you." }, { "docid": "130631", "title": "", "text": "\"In the US you are not required to have a corporation to use business expenses to offset your income. The technical term you need is \"\"deducting business expenses\"\", and in matters of taxes it's usually best to go straight to the horse's mouth: the IRS's explanations Deducting Business Expenses Business expenses are the cost of carrying on a trade or business. These expenses are usually deductible if the business operates to make a profit. What Can I Deduct? Cost of Goods Sold, Capital Expenses, Personal versus Business Expenses, Business Use of Your Home, Business Use of Your Car, Other Types of Business Expenses None of this requires any special incorporation or tax arrangements, and are a normal part of operating a business. However, there is a bit of a problem with your scenario. You said you \"\"invested\"\" into a business, but you mentioned buying specific things for the business which is not generally how one accounts for investment. If you are not an owner/operator of the business, then the scenario is not so straight-forward, as you can't simply claim someone else's business expenses as your own because you invested in it. Investments are taxed differently than expenses, and based upon your word choices I'm concerned that you could be getting yourself into a bit of a pickle. I would strongly advise you to speak with a professional, such as a Certified Public Accountant (CPA), to go over your current arrangement and advise you on how you should be structuring your ongoing investment into this shared business. If you are investing you should be receiving equity to reflect your ownership (or stock in the company, etc), and investments of this sort generally cannot be deducted as an expense on your taxes - it's just an investment, the same as buying stock or CDs. If you are just buying things for someone else's benefit, it's possible that this could be looked upon as a personal gift, and you may be in a precarious legal position as well (where the money is, indeed, just a gift). And gifts of this sort aren't deductible, either. Depending on how this is all structured, it's possible that you should both consider a different form of legal organization, such as a formal corporation or at least an official business partnership. A CPA and an appropriate business attorney should be able to advise you for a nominal (few hundred dollars, at most) fee. If a new legal structure is advisable, you can potentially do the work yourself for a few hundred dollars, or pay to have it done (especially if the situation is more complex) for a few hundred to a few thousand. That's a lot less than you'd be on the hook for if this business is being accounted for improperly, or if either of your tax returns are being reported improperly!\"" }, { "docid": "493813", "title": "", "text": "&gt;How is the government paid for these things? How is this handled without taxes? Are you suggesting that the people pay for all of this because they supposedly derive all the benefit while the businesses supposedly derive none from infrastructure. I'm not advocating no taxes whatsoever. &gt;Yes public roads may not be restricted by entities except in safety measures and compliance with DOT regulations. It is illegal for company A to blockade or otherwise make unavailable a public road to keep company B or the general public from using it. These type of rules also apply to communication lines and power infrastructure and are designed to decrease duplication and ensure that selected infrastructure is appropriate for the area. I think you misunderstood what I was trying to say. I'm trying to say, you don't have a right to a paved road wherever you want to go. That's not a government protected right." }, { "docid": "542213", "title": "", "text": "\"From the IRS perspective, there's no difference between \"\"your taxes\"\" and \"\"your sole proprietorship's taxes\"\", they're all just \"\"your taxes\"\". While I could see it being very useful and wise to track your business's activities separately, and use separate bank accounts and the like, this is just a convenience to help you in your personal accounting, and not something that needs to relate directly to how tax forms are completed or taxes are paid. When calculating your taxes, if you want to figure out how much \"\"you\"\" owe vs. how much \"\"your business\"\" owes, you'll have to do so yourself. One approach might be just to take the amount that your Schedule C puts as income on your return and multiply by your marginal tax rate. Another approach might be to have your tax software run the calculations as though you had no business income, and see what just \"\"your personal\"\" taxes would have been without the business. If you think of the business income as being \"\"first\"\" and should use up the lower brackets rather than your personal income, maybe do it the other way around and have your software run the calculations as though you had only the business income and no other personal/investment income, and see what the amount of taxes would be then. Once you've figured out a good allocation, the actual mechanics of paying some \"\"personal tax amount\"\" from your personal bank account and some \"\"business tax amount\"\" from your business bank account are up to you. I'd probably just transfer the money from my business account to my personal account and pay all the taxes from the personal account. Writing two separate checks, one from each account, that total to the correct amount, I'm sure would work just fine as well. You can probably make separate payments from each account electronically through Direct Pay or EFTPS as well. As long as all taxes are paid by the deadline, I don't think the IRS is too picky about the details of how many payments are made.\"" }, { "docid": "152502", "title": "", "text": "\"Even under the executive exemption, see Exemption for Executive Employees Under the Fair Labor Standards Act (FLSA) Section 13(a)(1) as defined by Regulations, 29 CFR Part 541, it seems that a minimum compensation is required. To qualify for the executive employee exemption, all of the following tests must be met: The employee must be compensated on a salary basis (as defined in the regulations) at a rate not less than $455 per week... etc. There is one other possibility under FLSA Section 13(a)(1), as a \"\"bona fide exempt executive\"\". Exemption of Business Owners Under a special rule for business owners, an employee who owns at least a bona fide 20-percent equity interest in the enterprise in which employed, regardless of the type of business organization (e.g., corporation, partnership, or other), and who is actively engaged in its management, is considered a bona fide exempt executive.\"" }, { "docid": "203905", "title": "", "text": "\"As far as I know any business can register for VAT regardless of the nature of the business. If all the goods you sell (or services you provide) are VAT-exempt or zero-rated then you will get refunds from HMRC on VAT your business pays. Any business whose non-VAT exempt turnover (which would include zero-rated goods and services provided) exceeds the registration threshold must register, again even if that means they are \"\"forced\"\" to claim refunds. So the only question would be whether your rather nebulous activities were enough to qualify you as a business or organisation to which the VAT regime applies at all. The one-liner answer to that is generally, if goods or services are provided in return for a charge, there’s a business activity for VAT purposes Inevitably there's a much bigger body of statute and case law and it won't always be obvious whether the one-liner answer applies or not to a particular activity so it may be necessary to seek specialist advice.\"" }, { "docid": "493468", "title": "", "text": "Setback for businesses? Please. It's clear someone has bought into the DNC and GOP's crony capitalist lies. This bill is staunchly pro consumer. In fact, it's pro honest business. It's only a setback for businesses who actively screw their consumers. I'm a libertarian, but even I can recognize this regulation as an all around win for society." }, { "docid": "269575", "title": "", "text": "Based on the additional comment you gave, I would recommend that you keep the capital from the businesses separate as much as possible. It sounds like you won't get into any trouble legally if you make 'loans' or transfers of capital from one business into the other. But I would suggest that you keep detailed records of any transfers that you do make. The reason why is that in any business, it is important to know the economics of how your business makes money. If you find yourself making transfers repeatedly, then your business model may be bad. Even if your transfers are only to deal with the cost of poor customers, it could still mean that your business model needs to be adjusted. But if it's a question of the timing of cash flows, then there's really nothing wrong with taking some of the money from your successful pants operation and building up more working capital in your stationery shop." }, { "docid": "420295", "title": "", "text": "\"I would look into the possibility that the promise \"\"that no taxes will be withheld\"\" is all about your status as a 'consultant'. They may be meaning you to be treated like a business they buy services from. In Canada the distinction is very watery and I presume the same in India. If you agree to become a business, then you must look into how that business income will be taxed.\"" }, { "docid": "462218", "title": "", "text": "No, what I'm saying is that the extant regulations have created such massive overheads to compliance that *only* big businesses can operate in that market because of the expenses required to be compliant. Eliminating that overhead would reduce expenses and make it possible for a greater diversity of firms to exist, reducing the *average size of any individual firm*, and increasing stability through diversity." }, { "docid": "373840", "title": "", "text": "\"&gt; the natural rights of the Jews who must live as second class citizens have certainly been lost. Really? What \"\"natural rights\"\" have they had removed? They are still free to own their own property, dispose of it as THEY see fit - say by not serving Bigot Bobby when he comes into their stores. A \"\"natural right\"\" it something that is innate to being human. You have no natural right to shop or buy things, sorry. &gt; And comparing an actual church to a church-run business like a hospital (the type of business affected by the Obama legislation you allude to) is also inappropriate for the same reason. Only because you don't want to admit that your worldview is based on he exertion of extreme force and prejudice. The fact that anyone would defend violating people's religious beliefs is just one indication of the moral sewer we've been led into by the equal rights nonsense. You do NOT have a right make any business owner - religious or otherwise - do things that are against their beliefs. Period. &gt; . But unless we abridge the rights of those with wealth and power to oppress others through economic means This is left drool of the worst kind. Wealth can only be accumulated via two methods: Theft (which I oppose in all it's forms including yourse wherein you want to seize the property of private citizens that own businesses) and Creation Of Value (whether by goods or services). Setting aside theft for a moment, this means that all wealth *is created because someone, somewhere created great value for other people. Even if I inherit money, it still came from one of these two sources. Most importantly *it does not bleong to the public, it does not belong to the government*. &gt; Being FORCED to live life as a second class citizen is FAR WORSE than being forced to do business with people you prefer to shun. Go start a business and get back to us. You are not only wrong, you are wrong pathologically. If a person is refused service for any reason, they can find another store, shop, or vendor. If I refuse to comply with government do-gooding and meddling, I go to jail. Forceful acts by government are ALWAYS far worse than forceful acts in the private sector, at least in the usual case. &gt; If you have any ideas about how to ensure all citizens have a realistic opportunity for success without any government intervention in the economy This is an absurd demand. Apparently, you did not get the memo. THERE IS NO EQUAL OPPORTUNITY IN LIFE FOR SUCCESS. How do I know this? Because some people are smarter, better looking, stronger, take more risks, have better families that support them and so on. The only way to equality of the sort the left keeps gurgling on and on about is to have everything lowered to the lowest possible common denominator. That's how you get the cultural messes like Watts in LA or Englewood in Chicago, downtown D.C., downtown Detroit, Appalachia, and so on. They're \"\"equal\"\" all right - equally miserable. You'd better grow up fast on this one - some people succeeding and a few failing is WAY better than EVERYONE failing... and that's exactly where your collectivist sewer leads. It doesn't matter what you or I think, it's observable in Reality.\"" }, { "docid": "373067", "title": "", "text": "&gt; But the big banks are not 'people you know'. They are legal persons just the same as a private individual, with exactly the same rights a natural person would get when signing the contract. Otherwise, they would never loan you any money in the first place. &gt; They will take from you all they can legally get (or less than legally if they can get away with it). That sounds so human I have a hard time finding any difference to my last carpenter. &gt; They follow the coldly rational, impersonally merciless path of greatest profit in the most immediate term, without the slightest concern for your humanity or needs. My humanity and needs do not exactly entice me into first making a contract, reaping all the benefits in it, and then breaking it when it becomes inconvenient to hold up my end of the bargain. If banks lose money, some very real people lose money because they trusted me. Besides, if banks are so evil, why would I ever do any business with them?" } ]

[ { "docid": "520386", "title": "", "text": "Your best approach is to assess rent levels in your local area for offices of a similar size. You need to take into account all the usuals - amenities, parking, etc, just as if your home-office was provided by a third-party. Get your $/sq ft and work out the monthly amount. With this figure, you need to then work out what % of it you can charge. If the space is used exclusively for the business, charge 100%. If it's used about half the time, charge 50%, etc. I would strongly advise you to do two things - 1. make sure your accountant and your attorney help you get this squared away. 2. document everything about how you arrived at the cost. Nothing fancy, but dates, realtors, addresses, $/sq foot. A simple table will do. By doing these two things, if the IRS should come around to chat, you should be covered." } ]

[ { "docid": "269401", "title": "", "text": "\"I can only share with you my happened with my wife and I. First, and foremost, if you think you need to protect your assets for some reason then do so. Be open and honest about it. If we get a divorce, X stays with me, and Y stays with you. This seems silly, even when your doing it, but it's important. You can speak with a lawyer about this stuff as you need to, but get it in writing. Now I know this seems like planning for failure, but if you feel that foo is important to you, and you want to retain ownership of foo no mater what, then you have to do this step. It also works both ways. You can use, with some limitations, this to insulate your new family unit from your personal risks. For example, my business is mine. If we break up it stays mine. The income is shared, but the business is mine. This creates a barrier that if someone from 10 years ago sues my business, then my wife is protected from that. Keep in mind, different countries different rules. Next, and this is my advise. Give up on \"\"his and hers\"\" everything. It's just \"\"ours\"\". Together you make 5400€ decide how to spend 5400€ together. Pick your goals together. The pot is 5400€. End of line. It doesn't matter how much from one person or how much from another (unless your talking about mitigating losses from sick days or injuries or leave etc.). All that matters is that you make 5400€. Start your budgeting there. Next setup an equal allowance. That is money, set aside for non-sense reasons. I like to buy video games, my wife likes to buy books. This is not for vacation, or stuff together, but just little, tiny stuff you can do for your self, without asking \"\"permission\"\". The number should be small, and equal. Maybe 50€. Finally setup a budget. House Stuff 200€, Car stuff 400€. etc. etc. then it doesn't matter who bought the house stuff. You only have to coordinate so that you don't both buy house stuff. After some time (took us around 6 months) you will find out how this works and you can add on some rules. For example, I don't go to Best Buy alone. I will spend too much on \"\"house stuff\"\". My wife doesn't like to make the budget, so I handle that, then we go over it. Things like that.\"" }, { "docid": "273925", "title": "", "text": "\"You're making $100k together per year: you're not in the donut hole, you're in the top 25% of all households, and the top 10% of non-family households (as yours would be). To be blunt, you're not in the \"\"rely on assistance\"\" area: you're in the \"\"save up for your downpayment\"\" sector. My suggestion would be to figure out a way to save more than $200-$400 a month for now. $100k gross income means you have about $8k net income per month; $2k for rent and other necessities means you have $6k per month that you can potentially save. Even half of that - $3k per month - means you have $24000 saved by the end of this year, and $36000 on an annual basis. As far as marriage or domestic partnership - I wouldn't get into one based on whether it helps you afford a home. It might be a good idea because it helps you handle some of the details arising when you have joint property, perhaps, but not solely for the financial aspect. And as far as how much home is realistic? $250k is certainly realistic if you can save up enough for a good down payment. Try to get to the 20-25% range. If you're already halfway there, another year of renting won't kill you, and it will mean no PMI and much better rates. Also consider a 15 year mortgage; we're in the same general income category as you and manage a 15 year on a $250k range house quite nicely. It doesn't add all that much to your monthly payment amount, compared to what you'd expect - particularly since the monthly payment includes property taxes which won't increase based on the length of the mortgage. Now that we have actual numbers from the OP: So, without cutting anything, you have $2k yourself you can be saving. (This assumes your rent number of $1345 is your portion of rent, and not the 100% amount.) That's $24000 per year, just by yourself. On top of that, you've got another $40k or so coming from your partner, at least some of which should be available as well if he/she is going to be co-owning? But if not, at least you have about $2000 a month you can be saving. You could also downsize the car, cut cable TV, downsize the phone, and have another $500 or so available - but it doesn't really look like you need to do that, given how much you have available now. I'd look at what you're doing with that ~$2000 per month right now, and see how you can free most of it up. You haven't mentioned a few things like utilities, not sure if that's just forgetfulness or if your partner is paying them; so perhaps not all of it is available. But - even $1000 a month is $12000 to add to the $20000 you have now, which makes a big dent in that down payment.\"" }, { "docid": "28504", "title": "", "text": "First you should understand the basics of how insurance companies make money: In a simple scenario, assume 1,000 have car insurance. Assume that on average, 100 people have accidents per year, and that each accident costs $10,000. So, we can expect total costs to be $1,000,000 per year. Some of those costs will be paid by the drivers, who have some sort of 'deductible'. That is - the insurance company will only cover costs after the driver has themself paid some initial amount [something like, the first $1,000 of repairs is paid by the driver]. So now the insurance company expects to have to pay out $900,000 in total claims this year. If they want to pay those claims (and also pay their administrative costs, and earn a profit), they might want to have $1,250,000 in revenue. Across 1,000 people, that would be $1,250 / year in insurance premiums. Of course, the big question for the insurance company is: how much will they really need to pay out in insurance claims each year? The better they can predict that number, the more profitable they can be [because they can charge a much more accurate amount, which can earn them new customers and gives them insurance {pun} that each new customer is actually profitable to them on average]. So the insurance company spends a lot of time and money trying to predict your likelihood of a car accident. They use a lot of metrics to do this. Some might be statistical hogwash that they charge you because they feel they can [if every insurance company charges you extra for driving a 2-door instead of a 4-door, then they all will], and some might be based in reality. So they attempt to correlate all of the items in your list, to see if any of those items indicates that you should be charged more (or less) for your insurance. This is equal parts art and science, and a lot of it comes down to how they market themselves. ie: if an insurance company gives a discount for being in college, is that because college drivers are better drivers, or is it because they want to increase the number of young customers they have, so they can keep those customers for life? Therefore how each metric factors into your calculation will be based on the company using it. It would basically be impossible to 'come up with' the same answer as the insurance company by having the information you provided, because of how heavily dependant that answer is on statistics + marketing. As for how your state matters - some states may have different accident rates, and different payout systems. For example - is Hawaii driving more dangerous because of all the tourists driving rented cars faster than they should? Is New York less expensive to insure because better public health care means less cost is borne by the insurance company in the event of an accident [I have no idea if either of these things are the case, they are purely for hypothetical discussion purposes]. In short, make sure you get quotes from multiple providers, and understand that it isn't just the cost that changes. Check changes in coverage and deductibles as well [ie: if one company charges you $100 / month when everyone else charges $200 / month - make sure that the cheaper company doesn't limit its coverage in ways that matter to you]." }, { "docid": "496395", "title": "", "text": "It seems that you are misunderstanding how your taxes are calculated. You seem to be under the impression that once you pass $37,450 annual income, ALL of your income will be taxed at 25%. However, in reality, only the income you earn above that amount will be taxed at 25%. You can use this chart to determine exactly how much federal tax you will pay; As you can see, if you earned, $37,500 in a year, you would only be charged 25% taxes on $50 (and you will pay 15% on the amount between $9226 and $37450, and 10% on the amount from $0 to $9225, which is $5126.25 when summed together)." }, { "docid": "15951", "title": "", "text": "\"House prices do not go up. Land prices in countries with growing economies tend to go up. The price of the house on the land generally depreciates as it wears out. Houses require money; they are called money pits for a reason. You have to replace HVAC periodically, roofs, repairs, rot, foundation problems, leaks, electrical repair; and all of that just reduces the rate at which the house (not the land) loses value. To maintain value (of the house proper), you need to regularly rebuild parts of the house. People expect different things in Kitchens, bathrooms, dining rooms, doors, bedrooms today than they do in the past, and wear on flooring and fixtures accumulate over time. The price of land and is going to be highly determined by the current interest rates. Interest rates are currently near zero; if they go up by even a few percent, we can expect land prices to stop growing and start shrinking, even if the economy continues to grow. So the assumption that land+house prices go up is predicated on the last 35 years of constant rigorous economic growth mixed with interest rate decreases. This is a common illusion, that people assume the recent economic past is somehow the way things are \"\"naturally\"\". But we cannot decrease interest rates further, and rigorous economic growth is far from guaranteed. This is because people price land based on their carrying cost; the cost you have to spend out of your income to have ownership of it. And that is a function of interest rates. Throw in no longer expecting land values to constantly grow and second-order effects that boost land value also go away. Depending on the juristiction, a mortgage is a hugely leveraged investment. It is akin to taking 10,000$, borrowing 40,000$ and buying stock. If the stock goes up, you make almost 5x as much money; if it goes down, you lose 5x as much. And you owe a constant stream of money to service the debt on top of that. If you want to be risk free, work out how you'd deal with the value of your house dropping by 50% together with losing your job, getting a job paying half as much after a period of 6 months unemployment. The new job requires a 1.5 hour commute from your house. Interest rates going up to 12% and your mortgage is up for renewal (in 15 years - they climbed gradually over the time, say), optionally. That is a medium-bad situation (not a great depression scale problem), but is a realistic \"\"bad luck\"\" event that could happen to you. Not likely, but possible. Can you weather it? If so, the risk is within your bounds. Note that going bankrupt may be a reasonable plan to such a bit of bad luck. However, note that had you not purchased the house, you wouldn't be bankrupt in that situation. It is reasonably likely that house prices will, after you spend ~3% of the construction cost of the house per year, pay the mortgage on the land+house, grow at a rate sufficient to offset the cost of renting and generate an economically reasonable level of profit. It is not a risk-free investment. If someone tries to sell you a risk-free investment, they are almost certainly wrong.\"" }, { "docid": "344955", "title": "", "text": "There are other answers here about how much you can deduct for a home office. What seems unique is the question of whether you can deduct it for both your LLC and for your employment. Unless your LLC owns the home, you cannot deduct the depreciation directly. Instead you have to charge your LLC rent for the time that you are using the space for the LLC. That rent must be declared as income on your personal tax return, and you can then offset some of it with the time you spend in that space working for your employer and depreciation for time it is being rented to your LLC. Using a strategy this complex may save you a few bucks on your return, but this is definitely an area where a tax professional is worth the expense making sure you get it right." }, { "docid": "516845", "title": "", "text": "This is easier than you think: 1) At the end of the year, AirBnb will send you a 1099 form. You will need to report the amount on this form as your rental income - they will report it to the IRS so it has to match. As a bonus, turning your condo into a rental property can become advantageous in that you can deduct repairs and improvements against any rental income. 2) As a host, you will have the option of charging a cleaning fee. Take a look at competitor listings to determine the average cleaning fee in your area. You do not have to clean before and after each guest, only before. 3) As a host, you also have the option of charging a security deposit to cover any damages. Don't get confused by AirBnb's host protection plan - this plan protects you against liability for damages incurred by your guests. Now take a look at competitor listings to determine your rental price. (You may want to lower your price initially to get positive reviews going). Deduct your cleaning fee plus any reasonable wear and tear not covered by the security deposit above. This is your rental income. If your rental income is a positive number - and as long as you charge a realistic cleaning fee/security deposit, it will be - you should rent it out. The worst that can happen is low occupancy i.e. you can't rent your place out as often as you expect. In which case you will be no worse off than you are today. Good luck!" }, { "docid": "296799", "title": "", "text": "\"You got some answers that essentially inform you that CEOs that have £200k written on their paysheet may in fact get much more. I'll take the opposite point of view and talk about people who (according to whatever definition) have a £200k/year income. How can they afford it Guess no 1: not all of them can (in the sense that it is quite possible to end up with negative net worth at £200k/year income - particularly if you immediately want to show off with brand new luxury cars, luxury holidays and a large house in a very representative region). Guess no 2: not all of the £200k/year CEOs are equally visible. There is a trade-off between going for wealth, large house, and luxury car. I deliberately ordered the three points according to increased display of \"\"wealth\"\". However, display of wealth usually comes at a cost (in a very monetary sense). And there are ways to get much display without having much wealth (see below: lease the car, also the mortgage on the house usually isn't displayed on the outside). You also need to take into account how long they are already building up wealth. I guess the typical CEO with £200k/year you're asking about did not just finish school and enter his work life in this position. It would be very interesting to see how income, accumulating wealth (and possibly \"\"displayed wealth\"\") correlate. My guess is that the correlation between income and accumulated wealth isn't that high, and the correlation between displayed and actual wealth is probably even lower. they possess luxury cars, large house and huge savings Are you sure these are the same managers? E.g. the ones with the huge savings are and the ones with the luxury cars? I'm asking particularly about the luxury cars, because such cars loose value very quickly and/or are often not owned by the driver but rather by the bank or leasing company. Which on the other hand offers the more savings-oriented CEO who is not that much interested in having a brand new luxury car the possibility to go for a one-year-old and save the rest. Knowing that, your CEO should be able to buy a one-year-old Mercedes SL 350 / year. Or a new one every 1 1/2 years (without building up savings or buying a house). However, building up wealth will be much faster with the CEO going for the one-year-old as the brand-new car option amounts to loosing ca. £20 - 30k within a year. An even-more-savings-oriented CEO who keeps his existing Mercedes 300 TD for another few years, thinking that this conservative choice of car will be trust-inspiring to the customers. Or goes for the SLK thinking that most people anyways don't know that the K between SL and SLK halves the price... However, if you just want to be seen with the car: after an initial payment of say £8-10k, you can get a decent SLK 350 (not the base model, either) at a monthly rate of ca. 600£/month or less than £7k/year. Note however, that this money does not count towards any kind of wealth, it's just renting a nice car. In other words: If driving the SLK 350 is your absolute goal, you could in theory have that with a net salary of £25k/year (according to your tax calculation, that should be somewhere around £35k / year gross), if you have the savings for the initial payment (being able to make the initial payment may also help convincin the leasing company that you're serious about it and able to pay your rates). There are also huge differences in value between large houses, compare e.g. these 2: And, last but not least, there is a decided one-way component in the timing of priorities here: it is much easier to go and get a luxury car when you have savings than first going for the luxury car and then trying to make up with the savings... I forgot to answer the question in the caption of your question: How do I build wealth By going on to live as if your income were only £50k (as far as that is compatible with your job) - I gather the median gross income in the UK is about £30k, so aiming at £50k leaves you a very comfortable budget for luxury spending. If you want to build up wealth faster, adjust that. In general, if you can manage to withhold much of any income increase from spending, that will help (trivial but powerful truth). From the leasing calculation you can conclude that you basically have no chance to show off your wealth by luxury cars. That is, you'd need to go for luxury cars that are completely incompatible with with building if you want to show your built up wealth by the car: there are too many people who even destroy their existing wealth in order to display luxury. At least if anyone is around who has either a correct idea what luxury cars cost (or don't cost) or will look that up in the internet. Also, people who know such things may also have the idea that the probability that such a car was downright paid (wealth) is small compared to the probability of meeting a leased or (mortgaged) car. Which means, the plan to show off doesn't work out that well with the people you'd want to impress. As for the other people: just a bit of display you can get far cheaper: If you really want to drive the SLK, rent it for an occasion (weekend) rather than for years. I met a sales manager who told me which rental cars they get when important customers from far east are visiting. The rest of the year they drive normal business cars. You may want to choose a rental company that doesn't write their name on the license plate. Apply the same ideas to the decision of buying a house. Think about what you want for yourself, and then look where you can get how much of that for how much money. Oh, and by the way: if I understand correctly, the average UK CEO wage is £120k, not £200k.\"" }, { "docid": "390744", "title": "", "text": "\"I don't think you've mentioned which State you're in. Here in Ontario, a person who is financially incapable can have their financial responsibility and authority removed, and assigned to a trustee. The trustee might be a responsible next of kin (as her ex, you would appear unsuitable: that being a potential conflict of interest); otherwise, it can be the Public Guardian and Trustee. It that happens, then the trustee handles the money; and handles/makes any contracts on behalf of (in the name of) the incapable person. The incapable person might have income (e.g. spousal support payments) and money (e.g. bank accounts), which the trustee can document in order to demonstrate credit-worthiness (or at least solvency). For the time being, the kids see it as an adventure, but I suspect, it will get old very fast. I hope you have a counsellor to talk with about your personal relationships (I've had or tried several and at least one has been extraordinarily helpful). You're not actually expressing a worry about the children being abused or neglected. :/ Is your motive (for asking) that you want her to have a place, so that the children will like it (being there) better? As long as your kids see it as an adventure, perhaps you can be happy for them. Perhaps (I don't know: depending on the people) too it's a good (or at least a better) thing that they are visiting with friends and relatives; and, a better conversational topic with those people might be how they show your children a good time (instead of your ex's money). One possible way I thought of co-signing is if a portion of child/spousal support goes directly to the landlord. I asked the Child Support Services (who deduct money from my paycheck monthly to pay support to my ex) and they told me that they are not authorized to do this. Perhaps (I don't know) there is some way to do that, if you have your ex's cooperation and a lawyer (and perhaps a judge). You haven't said what portions of your payments are for Child support, versus Spousal support (nor, who has custody, etc). If a large part of the support is for the children, then perhaps the children can rent the place. (/wild idea) Note that, in Ontario, there are two trusteeship decisions to make: 1) financial; and 2) personal care, which includes housing and medical. Someone can retain their own 'self-care' authority even if they're judged financially incapable (or vice versa if there's a personal-care or medical decision which they cannot understand). The technical language is, \"\"Mentally Incapable of Managing Property\"\" This term applies to a person who is unable to understand information that is relevant to making a decision or is unable to appreciate the reasonably foreseeable consequences of a decision or lack of decision about his or her property. Processes for certifying an individual as being mentally incapable of managing property are prescribed in the SDA (Substitute Decisions Act), and in the Mental Health Act.\"\" The Mental Heath Act is for medical emergencies (only); but Ontario has a Substitute Decisions Act as well. An intent of the law is to protect vulnerable people. People may also acquire and/or name their own trustee and/or guardian voluntarily: via a power of attorney, a living will, etc. I don't know: how about offering the landlord a year's rent in advance, or in trust? I guess that 1) a court order can determine/override/guarantee the way in which the child support payments are directed 2) it's easier to get that order/agreement if you and your ex cooperate 3) there are housing specialists in your neighborhood: They can buy housing instead of renting it. Or be given (gifted) housing to live in.\"" }, { "docid": "565409", "title": "", "text": "As a landlord for 14 years with 10 properties, I can give a few pointers: be able and skilled enough to perform the majority of maintenance because this is your biggest expense otherwise. it will shock you how much maintenance rental units require. don't invest in real estate where the locality/state favors the tenant (e.g., New York City) in disputes. A great state is Florida where you can have someone evicted very quickly. require a minimum credit score of 620 for all tenants over 21. This seems to be the magic number that keeps most of the nightmare tenants out makes sure they have a job nearby that pays at least three times their annual rent every renewal, adjust your tenant's rent to be approximately 5% less than going rates in your area. Use Zillow as a guide. Keeping just below market rates keeps tenants from moving to cheaper options. do not rent to anyone under 30 and single. Trust me trust me trust me. you can't legally do this officially, but do it while offering another acceptable reason for rejection; there's always something you could say that's legitimate (bad credit, or chose another tenant, etc.) charge a 5% late fee starting 10 days after the rent is due. 20 days late, file for eviction to let the tenant know you mean business. Don't sink yourself too much in debt, put enough money down so that you start profitable. I made the mistake of burying myself and I haven't barely been able to breathe for the entire 14 years. It's just now finally coming into profitability. Don't get adjustable rate or balloon loans under any circumstances. Fixed 30 only. You can pay it down in 20 years and get the same benefits as if you got a fixed 20, but you will want the option of paying less some months so get the 30 and treat it like a 20. don't even try to find your own tenants. Use a realtor and take the 10% cost hit. They actually save you money because they can show your place to a lot more prospective tenants and it will be rented much sooner. Empty place = empty wallet. Also, block out the part of the realtor's agreement-to-lease where it states they keep getting the 10% every year thereafter. Most realtors will go along with this just to get the first year, but if they don't, find another realtor. buy all in the same community if you can, then you can use the same vendor list, the same lease agreement, the same realtor, the same documentation, spreadsheets, etc. Much much easier to have everything a clone. They say don't put all your eggs in one basket, but the reality is, running a bunch of properties is a lot of work, and the more similar they are, the more you can duplicate your work for free. That's worth a lot more day-to-day than the remote chance your entire community goes up in flames" }, { "docid": "81530", "title": "", "text": "\"Anytime you do work without any payment until the work is complete, you are effectively extending credit to the party receiving your service. How much credit you are willing to extend will vary greatly, depending on the amount and the trustworthiness of the party. For example, if you are charging $50 for something, you probably won't bother to collect money upfront, whereas if you are charging $5,000 you probably would collect some upfront. But if the party you are working for is a large financially sound company, the number may be even much higher than $5K as you can trust you will be paid. Obviously there are many factors that go into how much credit you are willing to extend to your customer. (This is why credit reports exist for banks to determine how much credit to extend to you.) As for the specific case you are asking about, which may be classified as a decent amount of work for a small business, I would default to having a written scope of work, a place in the document for both parties to sign, and specify 50% upfront payment and 50% payment at completion. When you receive the signed document and the upfront payment (and possibly even after the check clears), you begin work. I would call this my \"\"default contract\"\" and adjust according to your needs depending on the size of the job and the trustworthiness of the customer. As for your question about how to deposit the check, that depends on what type of entity you are. If you are a sole proprietor you should ask for the checks to be made out to you. If you are a business then the checks should be made out to your business name. You don't need \"\"in trust\"\" or anything similar because your customer, after paying the upfront fee, must trust that you will do the work you promise to do, just like you have to trust that after completing the work you will receive the final payment. This is the reason the default is 50% before and after. Both parties are risking (roughly) the same amount. Tip: having done the \"\"default\"\" contract many times in my career, both as a sole proprietor and a business owner, I can assure you there is a big difference between a potential customer agreeing to something in advance, and actually writing a check. The upfront payment definitely helps weed out those that were never going to end up paying you, even if their intentions were good. Tip 2: be as specific as possible as to what the scope of work will include. If you don't, particularly with software, they'll be adding feature after feature and expecting it to be \"\"included\"\".\"" }, { "docid": "284081", "title": "", "text": "Down payment: Emphatically avoid PMI if at all possible; it's pouring money down the drain. Do 20% down if you can, or pay off enough to bring you above 20% and ask for PMI to be removed as soon as you can. Beyond that it's a matter of how much risk you want to accept and how long you'll own the place, and you'll have to run the numbers for the various alternatives -- allowing for uncertainty in your investments -- to guide your decision. Do not assume you will be able to make a profit when you sell the house; that's the mistake which left many people under water and/or foreclosed on. Do not assume that you will be able to sell it quickly; it can take a year of more. Do not assume immediate or 100% occupancy it you rent it out; see many other answers here for more realistic numbers.... and remember that running a rental is a business and has ongoing costs and hassles. (You can contract those out, but then you lose a good percentage of the rent income.) Double mortgage is another great way to dig yourself into a financial hole; it can be a bigger cost than the PMI it tries to dodge and is definitely a bigger risk. Don't." }, { "docid": "487354", "title": "", "text": "If there are a lot of houses for sale, can you be sure that in a year or two you can sell yours? How long does the average house in that area stay on the market before it is sold? What percentage of houses never get sold? If it can't be sold due to the crowded market you will be forced to rent the house. The question for you then is how much rental income can you get? Compare the rental income to your monthly cost of owning, and managing the house. One benefit to buying a house in a market that is easy to rent a house would be if you are forced to move quickly, then you aren't stuck being 3 months into a 12 month lease. Keep in mind that markets can change rather dramatically in just a few years. Housing costs were flat for much of the 90's, then rocketed up in the first half of the last decade, and after a big drop, they are one a slow climb back up. But the actual path they are on depends on the part of the US you are in. The rule of thumb in the past was based on the fact that over a few years the price would rise enough overcome the closing costs on the two transactions. Unfortunately the slow growth in the 90's meant that many had to bring checks to closing because the equity gained wasn't enough to overcome the closing costs due to low down payment loans. The fast growth period meant that people got into exotic loans to maximize the potential income when prices were going up 10-20% a year. When prices dropped some found that they bought houses they couldn't afford, but couldn't sell to break even on the transaction. They were stuck and had to default on the mortgage. In fact I have never seen a time frame when the rule of thumb ever applied." }, { "docid": "362210", "title": "", "text": "Shop lots of houses. Find at least three you want and start by offering a low price and working your way up. Your risk is that houses you would have liked get bought by someone else while you are negotiating, that is how you discover how much you actually have to pay to get a house. Brokers only get paid if a deal closes. That is their incentive to get you a better price. If they know you will buy a different house unless the one they are selling gets your business, then they will work to make that happen." }, { "docid": "302951", "title": "", "text": "Gonna have to think about this one yourself. How much is the old house worth if you sell it? How much can you rent it out for? If you can sell it for a decent amount, you might be able to pay off the current house completely, save yourself nearly 200k in interest, and maybe end up with a bit more cash. If you can rent it for a high amount, it might be worth doing that and you could possibly use that and get more money than what the interest is. Just gotta weigh up your options, find out what you can get for the house if you rent or sell." }, { "docid": "338606", "title": "", "text": "Before doing anything else: you want a lawyer involved right from the beginning, to make sure that something reasonable happens with the house if one of you dies or leaves. Seriously, you'll both be safer and happier if it's all explicit. How much you should put on the house is not the right question. Houses don't sell instantly, and while you can access some of their stored value by borrowing against them that too can take some time to arrange. You need to have enough operating capital for normal finances, plus an emergency reserve to cover unexpectedly being out of work or sudden medical expenses. There are suggestions for how much that should be in answers to other questions. After that, the question is whether you should really be buying a house at all. It isn't always a better option than renting and (again as discussed in answers to other questions) there are ongoing costs in time and upkeep and taxes and insurance. If you're just thinking about the financials, it may be better to continue to rent and to invest the savings in the market. The time to buy a house is when you have the money and a reliable income, plan not to move for at least five years, really want the advantages of more elbow room and the freedom to alter the place to suit your needs (which will absorb more money)... As far as how much to put down vs. finance: you really want a down payment of at least 20%. Anything less than that, and the bank will insist you pay for mortgage insurance, which is a significant expense. Whether you want to pay more than that out of your savings depends on how low an interest rate you can get (this is a good time in that regard) versus how much return you are getting on your investments, combined with how long you want the mortgage to run and how large a mortgage payment you're comfortable committing to. If you've got a good investment plan in progress and can get a mortgage which charges a lower interest rate than your investments can reasonably be expected to pay you, putting less down and taking a larger mortgage is one of the safer forms of leveraged investing... IF you're comfortable with that. If the larger mortgage hanging over you is going to make you uncomfortable, this might not be a good answer for you. It's a judgement call. I waited until i'd been in out of school about 25 years before I was ready to buy a house. Since i'd been careful with my money over that time, I had enough in investments that I could have bought the house for cash. Or I could have gone the other way and financed 80% of it for maximum leverage. I decided that what I was comfortable with was financing 50%. You'll have to work thru the numbers and decide what you are comfortable with. But I say again, if buying shared property you need a lawyer involved. It may be absolutely the right thing to do ... but you want to make sure everything is fully spelled out... and you'll also want appropriate terms written into your wills. (Being married would carry some automatic assumptions about joint ownership and survivor rights... but even then it's safer to make it all explicit.) Edit: Yes, making a larger down payment may let you negotiate a lower interest rate on the loan. You'll have to find out what each bank is willing to offer you, or work with a mortgage broker who can explore those options for you." }, { "docid": "481401", "title": "", "text": "Personal finance is a fairly broad area. Which part might you be starting with? From the very basics, make sure you understand your current cashflow: are you bank balances going up or down? Next, make a budget. There's plenty of information to get started here, and it doesn't require a fancy piece of software. This will make sure you have a deeper understanding of where your money is going, and what is it being saved for. Is it just piling up, or is it allocated for specific purchases (i.e. that new car, house, college tuition, retirement, or even a vacation or a rainy day)? As part of the budgeting/cashflow exercise, make sure you have any outstanding debts covered. Are your credit card balances under control? Do you have other outstanding loans (education, auto, mortgage, other)? Normally, you'd address these in order from highest to lowest interest rate. Your budget should address any immediate mandatory expenses (rent, utilities, food) and long term existing debts. Then comes discretionary spending and savings (especially until you have a decent emergency fund). How much can you afford to spend on discretionary purchases? How much do you want to be able to spend? If the want is greater than the can, what steps can you take to rememdy that? With savings you can have a whole new set of planning to consider. How much do you leave in the bank? Do you keep some amount in a CD ladder? How much goes into retirement savings accounts (401k, Roth vs. Traditional IRA), college savings accounts, or a plain brokerage account? How do you balance your overall portfolio (there is a wealth of information on portfolio management)? What level of risk are you comfortable with? What level of risk should you consider, given your age and goals? How involved do you want to be with your portfolio, or do you want someone else to manage it? Silver Dragon's answer contains some good starting points for portfolio management and investing. Definitely spend some time learning the basics of investing and portfolio management even if you decide to solicit professional expertise; understanding what they're doing can help to determine earlier whether your interests are being treated as a priority." }, { "docid": "295688", "title": "", "text": "\"There are actually a few questions you are asking here. I will try and address each individually. Down Payment What you put down can't really be quantified in a dollar amount here. $5k-$10k means nothing. If the house costs $20k then you're putting 50% down. What is relevant is the percent of the purchase price you're putting down. That being said, if you go to purchase a property as an investment property (something you wont be moving into) then you are much more likely to be putting a down payment much closer to 20-25% of the purchase price. However, if you are capable of living in the property for a year (usually the limitation on federal loans) then you can pay much less. Around 3.5% has been my experience. The Process Your plan is sound but I would HIGHLY suggest looking into what it means to be a landlord. This is not a decision to be taken lightly. You need to know the tenant landlord laws in your city AND state. You need to call a tax consultant and speak to them about what you will be charging for rent, and how much you should withhold for taxes. You also should talk to them about what write offs are available for rental properties. \"\"Breaking Even\"\" with rent and a mortgage can also mean loss when tax time comes if you don't account for repairs made. Financing Your first rental property is the hardest to get going (if you don't have experience as a landlord). Most lenders will allow you to use the potential income of a property to qualify for a loan once you have established yourself as a landlord. Prior to that though you need to have enough income to afford the mortgage on your own. So, what that means is that qualifying for a loan is highly related to your debt to income ratio. If your properties are self sustaining and you still work 40 hours a week then your ability to qualify in the future shouldn't be all that impacted. If anything it shows that you are a responsible credit manager. Conclusion I can't stress enough to do YOUR OWN research. Don't go off of what your friends are telling you. People exaggerate to make them seem like they are higher on the socioeconomic ladder then they really are. They also might have chicken little syndrome and try to discourage you from making a really great choice. I run into this all the time. People feel like they can't do something or they're to afraid so you shouldn't be able to either. If you need advice go to a professional or read a book. Good luck!\"" }, { "docid": "358137", "title": "", "text": "why not ask a fee only financial adviser? Contact a local adviser and ask how much they will charge to work through the process. The options aren't as complex as they seem. The general idea is to first figure out what you can afford each month. This is a generally straight forward calculation. Then figure out the costs that are specific to your area, e.g property taxes. Figure out how much of a down payment /closing costs you can gather. Then start with your local bank or credit union. The number of options for mortgages will not be as complex if you already know how much you can afford and how much cash you can bring to the transaction. A simple table can be easily created based on what you can afford each month, how much cash you have, and the rates currently available. The bank will have a way to estimate the costs of each option as part of the required disclosures. Another source of good info can be a highly regarded local real estate agent. Focus on one that will represent you as a purchaser. They want you to be able to buy a house. While they do have a bias, they want a commission, most of it is eliminated if you know how much you can afford before you meet with them. They will know all the government programs that can make the monthly costs or closing costs cheaper." } ]

[ { "docid": "220063", "title": "", "text": "\"If you are talking about a home office, you don't \"\"charge\"\" the business anything. If the area is used exclusively as an office you pro-rate by square footage just the actual expenses. TurboTax recent published an article \"\"Can I Take the Home Office Deduction?\"\" which is a must read if you don't understand the process. (Note: I authored said article.)\"" } ]

[ { "docid": "487354", "title": "", "text": "If there are a lot of houses for sale, can you be sure that in a year or two you can sell yours? How long does the average house in that area stay on the market before it is sold? What percentage of houses never get sold? If it can't be sold due to the crowded market you will be forced to rent the house. The question for you then is how much rental income can you get? Compare the rental income to your monthly cost of owning, and managing the house. One benefit to buying a house in a market that is easy to rent a house would be if you are forced to move quickly, then you aren't stuck being 3 months into a 12 month lease. Keep in mind that markets can change rather dramatically in just a few years. Housing costs were flat for much of the 90's, then rocketed up in the first half of the last decade, and after a big drop, they are one a slow climb back up. But the actual path they are on depends on the part of the US you are in. The rule of thumb in the past was based on the fact that over a few years the price would rise enough overcome the closing costs on the two transactions. Unfortunately the slow growth in the 90's meant that many had to bring checks to closing because the equity gained wasn't enough to overcome the closing costs due to low down payment loans. The fast growth period meant that people got into exotic loans to maximize the potential income when prices were going up 10-20% a year. When prices dropped some found that they bought houses they couldn't afford, but couldn't sell to break even on the transaction. They were stuck and had to default on the mortgage. In fact I have never seen a time frame when the rule of thumb ever applied." }, { "docid": "34246", "title": "", "text": "\"Figure out how much money you earn, what you spend it on, and how that will change when you have kids (will one of you stay at home? if not, how much will daycare cost and how do you finance the first few month when your child is still too young for daycare?) You will usually plan to spend your current Kaltmiete (rent without utilities) on your mortgage (the Darlehen that is secured by your house) - keep in mind though that a house usually has a higher utility cost than an appartment. When you've figured out what you can save/pay towards a house now and how that will change when you have kids, you can go on to the next step. If you don't want to buy now but want to commit to saving up for a house and also want to secure today's really low interest rates, consider getting a \"\"Bausparvertrag\"\". I didn't find a good translation for Bausparvertrag, so here is a short example of how it works: You take a building saving sum (Bausparsumme) of 150000€ with a savings goal (Sparziel) of 50000€ (the savings goal is usually between 20% and 50% of the sum) and then you make monthly payments into the Bausparvertrag until you reach the savings goal at which point you can take out your savings and a loan of 100000 € (or whatever your difference between the Bausparsumme and Sparziel is). If you're living in an expenisve area, you're likely to need more than 150000 but this is just an example. Upsides: Downsides: If you decide to buy sooner, you can also use your Bausparvertrag to refinance later. If you have a decent income and a permanent job, then ask your bank if they would consider financing your house now. To get a sense of what you'll be able to afford, google \"\"wie viel Haus kann ich mir leisten\"\" and use a few of the many online calculators. Remember that these websites want to sell you on the idea of buying a house instead of paying rent, so they'll usually overestimate the raise in rents - repeat the calculation with rent raise set to 0% to get a feeling for how much you'll be able to afford in today's money. Also, don't forget that you're planning to get children, so do the calculation with only one income, not two, and add the cost of raising the kids to your calculation. Once you've decided on a property, shop around a bit at different banks to get the best financing. If you decide to buy now (or soon), start looking at houses now - go to model homes (Musterhäuser) to find out what style of house you like - this is useful whether you want to buy an existing house or build a new one. If buying an existing house is an option for you, start visiting houses that are on sale in your area in order to practice what to ask and what to look for. You should have a couple of visits under your belt before you really start looking for the one you want to buy. Once you're getting closer to buying or making a contract with a construction company, consider getting an expert \"\"Bausachverständiger\"\". When buying an existing house they can help you estimate the price and also estimate the renovation cost you'll have to factor in for a certain house (new heating, better insulation, ...). When building a new house they can advise you on the contract with the construction company and also examine the construction company's work at each major step (Zwischenabnahme). Source: Own experience.\"" }, { "docid": "107980", "title": "", "text": "\"Have you tried registering for social housing? Rent prices through social housing are typically cheaper than on the free market. You might be able to jump to the front of the waiting list due to your wife's unexpected handicap. See this link: http://www.rijksoverheid.nl/onderwerpen/huurwoning/sociale-huurwoning-huren To more directly answer your question: I don't think there is any limitation on how your family needs to get the money to lend it to you. They could lookinto a personal loan (persoonlijke lening), but they might not be able to borrow enough. The Netherlands does not have a direct equivalent of a Home Equity Line of Credit (HELOC), but your family could potentially get a second mortgage (tweede hypotheek) on their house in order to get the money to lend you. However, be aware that this is a very risky endeavor. There are lots of unknowns that could leave you unable to pay or your family unable to pay. Receiving the money as a gift with the intention to repay it but no formal agreement in place may also leave you and your family in a difficult position. I would encourage you to visit a mortgage advisor together to discuss scenarios. Note that one possible option you may want to explore is a \"\"family mortgage\"\" (familiehypotheek). This is just a fancy way of saying that your family can act as (one of) your mortgage lenders. You and your family must comply with all relevant rules and regulations to do this, including them charging you interest and them reporting certain things to the tax authorities. Vereniging Eigen Huis has details on how to set such a mortgage up and how to manage the required reporting: https://www.eigenhuis.nl/webwinkel/hypotheekservice/familiehypotheek/\"" }, { "docid": "458183", "title": "", "text": "Here would be the general steps to my mind for creating such a plan: Write out the final desired outcome. Is it $x in y years to fund your retirement? Is it $a in b years to put as a house down payment? This is the first step in defining how much money you want at what point in time. Consider what is your risk tolerance and how much time do you plan on spending in this plan. Is it rebalancing once a quarter and that's it or do you plan on doing monthly research and making tweaks all the time? This is slightly different from the first where one has to be mindful of how much volatility would one handle and what time commitment does one have for an investing strategy. Also, how much money would you be adding to the investments on what kind of time table would also be worth noting here. Construct the asset allocation based on the previous two steps along with historical returns averaged out to be a first draft of what you are buying in general. Is it US stocks? Is it a short-term bond fund? There are more than a few choices here that may make sense and it is worth considering based on the first couple of responses that determine what this will look like. Retirement in 40 years may be quite different than a house down payment in 2 years for example. Determine what brokerages or fund companies would offer such funds along with what types of accounts you'd want to have as in some countries there may be tax-advantaged accounts that may be useful to use here. This is where you're almost ready to start by doing the homework of figuring out how will things work. This may vary depending on one's jurisdiction. Get the applications from whatever institutions you'll be using and run with the desired asset allocation across various funds and accounts. Note that in the first few steps there were points of being aware of how much would you have, how aggressive are you investing and so forth. This is where you actually send in the money and get things rolling. Run with the plan and make tweaks as needed to achieve result, hopefully desired or better." }, { "docid": "485898", "title": "", "text": "Getting the first year right for any rental property is key. It is even more complex when you rent a room, or rent via a service like AirBnB. Get professional tax advice. For you the IRS rules are covered in Tax Topic 415 Renting Residential and Vacation Property and IRS pub 527 Residential Rental Property There is a special rule if you use a dwelling unit as a personal residence and rent it for fewer than 15 days. In this case, do not report any of the rental income and do not deduct any expenses as rental expenses. If you reach that reporting threshold the IRS will now expect you to to have to report the income, and address the items such as depreciation. When you go to sell the house you will again have to address depreciation. All of this adds complexity to your tax situation. The best advice is to make sure that in a tax year you don't cross that threshold. When you have a house that is part personal residence, and part rental property some parts of the tax code become complex. You will have to divide all the expenses (mortgage, property tax, insurance) and split it between the two uses. You will also have to take that rental portion of the property and depreciation it. You will need to determine the value of the property before the split and then determine the value of the rental portion at the time of the split. From then on, you will follow the IRS regulations for depreciation of the rental portion until you either convert it back to non-rental or sell the property. When the property is sold the portion of the sales price will be associated with the rental property, and you will need to determine if the rental property is sold for a profit or a loss. You will also have to recapture the depreciation. It is possible that one portion of the property could show a loss, and the other part of the property a gain depending on house prices over the decades. You can expect that AirBnB will collect tax info and send it to the IRS As a US company, we’re required by US law to collect taxpayer information from hosts who appear to have US-sourced income. Virginia will piggyback onto the IRS rules. Local law must be researched because they may limit what type of rentals are allowed. Local law could be state, or county/city/town. Even zoning regulations could apply. Also check any documents from your Home Owners Association, they may address running a business or renting a property. You may need to adjust your insurance policy regarding having tenants. You may also want to look at insurance to protect you if a renter is injured." }, { "docid": "141868", "title": "", "text": "\"In my experience, in a house share situation, it seems to come down to how comfortable the occupants feel and how much of their own space they want. For example, I've come across lots of situations where someone is renting a room from a live in landlord, but in practice the two housemates (or roommates if you prefer) have equal run of the place and may even share food and hang out together and also the opposite, where people are sharing a property as equals, but tend to stick to their own room and don't share, or even more extreme, where they are technically equals but subject to one or more very domineering housemates (roommates). This happened to someone I know who was renting with two \"\"friends\"\" but was forced to move out. I run a website - aimed at lodgers and live in landlords, and house sharers to a lesser degree, mostly from the UK, but relevant everywhere as I deal with much more than legalities and tax. I came across this thread as I wanted to explore the difference in the US between a lodger and a roommate. From what I gather, the term \"\"lodger\"\" is understood, but the term \"\"roommate\"\" is more typically used to mean a lodger, which in itself suggests a more equal arrangement than in the UK, where we're more used to owning property than renting, and certainly sharing. However, I believe that if you're letting a room to someone, and they pay you a reasonable rent and respect both you and your home, you should be prepared to treat them as an equal on a day to day basis. If you're not, then you naturally won't attract either the best rent, or the best lodger/roommate, however desirable the property.\"" }, { "docid": "285449", "title": "", "text": "You should have a partnership agreement of some sort. The reason partnership agreements exist is so nobody can change the game because of the outcome. I'd say the most typical partnership agreement is that everyone gets an equal cut, meaning that everyone also makes an equal contribution. If you have start up expenses of $10,000, you'd each contribute $5,000. Separately, you can determine ownership share by contribution amounts, maybe one of you contributed $2,000 and the other $8,000; this would be an 80/20 split. The performance of the operation doesn't have anything to do with determining how to divide the pie, your partnership agreement determines that. How much have you each contributed and what agreement did you make before you decided to be partners? If you have a poor performing business segment, then the partnership should get together and consider adjusting or stopping that line of business. But you don't change how the pie is divided because of it; unless your partnership agreement says you do." }, { "docid": "549601", "title": "", "text": "I know of no generic formula for determining if an investment property is a good investment, besides the trivial formula. Make sure your income is greater than your expenses, and hope the value of the property doesn't drop. Some people will tell you to expect the monthly rent to be a fixed percentage of the purchase price, but that is a goal not a certainty. It is also impossible to estimate the difficulty renting the property, or how long the roof will last. Taxes can't be predicted, as the value of the house increase, so do the property taxes, but you might not be able to increase the rent. You can't even predict the quality of the tenant. Will they damage the property? Or skip out early? You will need somebody who knows the local market to estimate the local conditions, and help you determine the estimated costs and income based on the actual property involved." }, { "docid": "338606", "title": "", "text": "Before doing anything else: you want a lawyer involved right from the beginning, to make sure that something reasonable happens with the house if one of you dies or leaves. Seriously, you'll both be safer and happier if it's all explicit. How much you should put on the house is not the right question. Houses don't sell instantly, and while you can access some of their stored value by borrowing against them that too can take some time to arrange. You need to have enough operating capital for normal finances, plus an emergency reserve to cover unexpectedly being out of work or sudden medical expenses. There are suggestions for how much that should be in answers to other questions. After that, the question is whether you should really be buying a house at all. It isn't always a better option than renting and (again as discussed in answers to other questions) there are ongoing costs in time and upkeep and taxes and insurance. If you're just thinking about the financials, it may be better to continue to rent and to invest the savings in the market. The time to buy a house is when you have the money and a reliable income, plan not to move for at least five years, really want the advantages of more elbow room and the freedom to alter the place to suit your needs (which will absorb more money)... As far as how much to put down vs. finance: you really want a down payment of at least 20%. Anything less than that, and the bank will insist you pay for mortgage insurance, which is a significant expense. Whether you want to pay more than that out of your savings depends on how low an interest rate you can get (this is a good time in that regard) versus how much return you are getting on your investments, combined with how long you want the mortgage to run and how large a mortgage payment you're comfortable committing to. If you've got a good investment plan in progress and can get a mortgage which charges a lower interest rate than your investments can reasonably be expected to pay you, putting less down and taking a larger mortgage is one of the safer forms of leveraged investing... IF you're comfortable with that. If the larger mortgage hanging over you is going to make you uncomfortable, this might not be a good answer for you. It's a judgement call. I waited until i'd been in out of school about 25 years before I was ready to buy a house. Since i'd been careful with my money over that time, I had enough in investments that I could have bought the house for cash. Or I could have gone the other way and financed 80% of it for maximum leverage. I decided that what I was comfortable with was financing 50%. You'll have to work thru the numbers and decide what you are comfortable with. But I say again, if buying shared property you need a lawyer involved. It may be absolutely the right thing to do ... but you want to make sure everything is fully spelled out... and you'll also want appropriate terms written into your wills. (Being married would carry some automatic assumptions about joint ownership and survivor rights... but even then it's safer to make it all explicit.) Edit: Yes, making a larger down payment may let you negotiate a lower interest rate on the loan. You'll have to find out what each bank is willing to offer you, or work with a mortgage broker who can explore those options for you." }, { "docid": "362210", "title": "", "text": "Shop lots of houses. Find at least three you want and start by offering a low price and working your way up. Your risk is that houses you would have liked get bought by someone else while you are negotiating, that is how you discover how much you actually have to pay to get a house. Brokers only get paid if a deal closes. That is their incentive to get you a better price. If they know you will buy a different house unless the one they are selling gets your business, then they will work to make that happen." }, { "docid": "420707", "title": "", "text": "It seems very risky have all of your net worth in this one home. If I were to buy the house, I'm not sure I would put that much down, consider 20% and keep cash on hand, in retirement assets, etc. I would look at how much a mortgage, plus interest, taxes, insurance, etc. would cost with 50% down and with 20% down and see how that impacts your cash flow. Renting may make more sense, it's hard to tell without more specifics (NYTimes Rent/Buy calculator is a nice tool), but regardless, I would not want to have so much net worth tied into one asset and so would opt for less money down if I were to buy. Focus on rebuilding some retirement assets." }, { "docid": "379023", "title": "", "text": "EDIT: new ideas based on the full story. I wouldn't worry about the price history. While it is certainly true that some buyers might try to leverage that information against you, the bottom line is the price is the price. Both the buyer and the seller have to agree. If the initial listing was too high, then lower the price. If that isn't low enough, then readjust down. I see no harm in moving the price down over time repeatedly. In fact, I thin that is a good tactic to getting the most for the house. If you happen to have the luxury of time, then keep lowering that price until it sells. Don't fret how that behavior appears. You can lower the price as often as you like until it sells. I am not a real estate agent, and I am a terrible negotiator, but I would lower the price every quarter until it sells. You can't go down to fast (a buyer might wait you out) and you can't wait to long as you stated. Also, if you house is priced inline with the neighborhood, you can at least get offers and negotiate. Buy asking for such a premium (25%) folks might not even make an offer. You simply need to decide what is more important, the selling price or the time frame in getting it sold. If you house doesn't sell because the market doesn't support your price, then consider keeping it as a rental. You can do it yourself, or if you are not interested in that (large) amount of work, then hire a rental management company to do it for a fee. Renting a home is hard work and requires attention to detail, a good amount of your time and much labor. If you just need to wait a couple of years before selling, renting it can be a good option to cover your costs while you wait for the market to reach you. You should get advice on how to handle the money, how to rent it, how to deal with renters, and the the laws are in your jurisdiction. Rent it out to a trusted friend or family member for a steal of a deal. They save money, and you get the luxury of time waiting for the sale. With a real estate lawyer you hire, get a contract for a lease option or owner finance deal on the house. Sometimes you can expand the market of people looking to buy your house. If you have a willing purchaser will bad credit, you can be doing them a favor and solving your own issue. It costs money and you will make less on the sale, but it could be better than nothing. Take heed, there is a reason some people cannot get a traditional loan on their own. Before you extend your good name or credit think about it. It is another hassle for sure. This won't help if you have to pay off a mortgage, but you could donate it. This is another tricky deal that you really need to speak with a lawyer who specialize in charitable giving. There are tax benefits, but I would make any kind of a deal where tax deductions are the only benefit. This is common enough these days. If you are unable to pay for the mortgage, it benefits you and the bank to get into a short sale arrangement. They bank gets probably more money than if they have to foreclose (and they save money on legal fees) and you can get rid of the obligation. You will do a deed in lieu or the short sale depending on how the market it and what the house can be sold for. You and the bank will have to work it out. This will ruin for a credit for a while, and you will not likely qualify to get a new mortgage for at least a few years. You can stop paying your mortgage, tell the bank and they will foreclose. This is going to ruin your credit for a long time as well as disqualify you from mortgages in the near future. Don't do this. If you are planning a foreclosure, take the time to contact your bank and arrange a short sale or a deed in lieu. There isn't really any excuse to go into foreclosure if you are having problems. Talk to the bank and work out a deal." }, { "docid": "397749", "title": "", "text": "There could be a number of reasons for a rent increase. The only information I can offer is how I calculate what rent I will charge. The minimum I would ever charge per unit (Mortgage payment + Water) / Number of units This number is the minimum because it's what I need to keep afloat. Keep in mind these are ballpark numbers The target rent ((Mortgage payment + Water) / Number of units)*1.60 I mark up the price 60% for a few reasons. First, the building needs a repair budget. That money has to come from somewhere. Second, I want to put away for my next acquisition and third I want to make a profit. These get me close to my rental price but ultimately it depends on your location and the comparables in the area. If my target rent is 600 a month but the neighbors are getting 700-800 for the same exact unit I might ask more. It also depends on the types of units. Some of my buildings, all of the units are identical. Other buildings half of the units are bigger than the other half so clearly I wouldn't charge a equal amount for them. Ultimately you have to remember we're not in the game to lose money. I know what my renters are going to pay before I even put an offer in on a building because that's how I stay in business. It might go up over the years but it will always outpace my expenses for that property." }, { "docid": "67731", "title": "", "text": "\"Property taxes, where they exist, are generally levied by cities, counties and other local-level administrative bodies like MUDs, and are the primary source of revenue at these levels of government. These taxes pay the lion's share of the expenses for basic services provided by a city or county: There are federal dollars, other revenue sources (State lottery revenues often go toward public schools for instance), and \"\"usage fees\"\" (vehicle registration, utility bills, toll roads) at play as well, but a lot of that money covers larger-scale infrastructure development (freeways/interstates) and specialized \"\"earmarks\"\" (political backscratching involving this bridge or that dam in a Congresscritter's home district, a few national initiatives from the President's budget like first-responder technology upgrades for improved disaster/terrorism readiness). Property taxes are the main funding for the day-to-day government operations at the most visible level to the average resident. The theory behind using a property tax instead of some other form of taxation (like income) is that the value of the property and the quality of services provided to the resident(s) of that property are interrelated; the property is valuable in part because the infrastructure is well-maintained and nearby schools/hospitals are good, and by the same token, affluent residents expect high-quality services. Property taxes are also easier to levy, because most of the work can be done by the tax assessor; monitor recent sale prices, do drive-bys through neighborhoods, come up with a number and send the resident the bill. That's opposed to sales taxes which businesses operating in the jurisdiction have to calculate, collect and turn over, or income taxes which require residents to fill out paperwork to calculate how much they owe. The justification is eminent domain. It's very simple; when you buy land in the U.S. and a State thereof, you are still a citizen and/or resident of that State and the U.S., and subject to their laws. You're not creating your own country when you buy a house. As such, the government charges you for the facilities and services they provide in your area and your State, which are then your privilege to use. Obviously roads aren't free; a one-mile stretch behind my house is costing the county $15 million to expand it from 2-lane to 4-lane. Here's the kicker; you've already been paying these taxes. You think your landlord's just going to take the property taxes for the whole apartment complex on the chin? He's out to make money, and doing that requires charging a sufficient amount to cover costs, including taxes he incurs. You just never see \"\"allocated property taxes\"\" as an item on your rent statement, just like you don't see \"\"allocated landowner mortgage\"\", \"\"allocated facilities maintenance\"\", \"\"allocated gross margin\"\" etc. You know you're getting shafted, paying someone else's financing with a little extra on the side to boot. That's why you want a house. Unfortunately, not being able to pay these taxes is a grim reality for some people, old and young, and government generally doesn't go easy on delinquent homeowners. After medical bills and mortgage delinquency, property tax delinquency is the number three reason for bankruptcy, and only a mortgage or property tax delinquency can cause your home to be seized and sold. Well that and using it for criminal enterprise, but unless you're running a meth lab in your half-million-dollar home or financing it with coke money I wouldn't worry about that score. Retirement planners figure property taxes into cost of living, and they do often advise a downgrade from the 2-story house you raised your children in to something smaller (for many reasons, including lower taxes). There really isn't a way to structure a completely \"\"pay-as-you-go\"\" metropolitan area, and you wouldn't want to live in it if there were. Imagine every strip of asphalt in the county being a toll road where your transponder (TollTag, EZ-Pass, etc) or license plate was scanned and you were billed at each intersection. In addition to being a huge invasion of privacy, the cost to maintain this network (and your cost to use it) would skyrocket. Imagine 911 asking for a credit card number before dispatching police, fire or EMS (Ambulance services already do bill on a per-event basis, but you'd be surprised how few people pay and how little power a county EMS has to enforce collection; without a property tax and Medicaid to cover the difference, EMS service could not be provided in most counties).\"" }, { "docid": "297427", "title": "", "text": "First, determine the workload he will expect. Will you have to quit your other work, either for time or for competition? How much of your current business will be subsumed into his business, if any? Make sure to understand what he wants from you. If you make an agreement, set it in writing and set some clear expectations about what will happen to your business (e.g. it continues and is not part of your association with the client). Because he was a client for your current business, it can blur the lines. Second, if you join him, make sure there is a business entity. By working together for profit, you will have already formed a partnership for tax purposes. Best to get an entity, both for the legal protection and also for the clarity of law and accounting. LLCs are simplest for small ventures; C corps are useful if you have lots of early losses and owners that can't use them personally, or if you want to be properly formed for easy consumption by a strategic. Most VCs and super-angels prefer everybody be a straight C. Again, remember to define, as necessary, what you are contributing to be an owner and what you are retaining (your original business, which for simplicity may already be in an entity). As part of this process, make sure he defines the cap table and any outstanding loans. Auntie June and Cousin Steve might think their gifts to him were loans or equity purchases; best to clear this issue up early before there's any more money in it. Third, with regard to price, that is an intensely variable question. It matters what the cap table looks like, how early you are, how much work he's already done, how much work remains to be done, and how much it will pay off. Also, if you do it, expect to be diluted by other employees, angels, VCs, other investors, strategics, and so on. Luckily, more investors usually indicates a growing pie, so the dilution may not be at all painful. But it should still be on your horizon. You also need to consider your faith in your prospective partner's ability to run the business and to be a trustworthy partner (so you don't get Zuckerberg'd), and to market the business and the product to customers and investors. If you don't like the prospects, then opt for cash. If you like the business but want to hedge, ask for compensation plus equity. There are other tricks you could use to get out early, like forced redemption, but they probably wouldn't help either because it'd sour your relationship or the first VC or knowledgeable angel to come along will want you to relinquish that sort of right. It probably comes down to a basic question of your need for cash, his willingness to let you pursue outside work (hopefully high) and your appraisal of the business' prospects." }, { "docid": "573265", "title": "", "text": "The are a couple of explanations that I can think of; though for determining exactly what is different you will want to print out both returns and compare them line by line to see how they differ. If the company grossed up your income to account for the taxes on housing (possibly by paying the additional withholding), you may be just benefiting from them estimating your tax rate. This can especially be the case if your only work was the three month internship. They would have to assume your salary was for the entire year. There is an earned income tax credit for low wage earners that you may have qualified for (it would depend your specific circumstances if you meet the criteria). But that credit for a range of income actually pays out more the more you earn (to encourage working that extra hour instead of reducing benefit because you had another hour of employment). As for the housing subsidy itself, while the value is quite high the IRS considers that to be a taxable benefit that the employer provided you and so it needs to be added to your W-2 wages. $8k a month seems quite high, but I don't know the quality of the apartment you were provided and what the going rates are in the area. Given that you said you worked for a major tech company, I can imagine that you might have been working in an area with high rents. If the employer did gross up your paycheck so as to cover your taxes, that $24k would also include that extra tax payment (e.g. if the employer paid $8k in additional taxes for you, then the housing cost that they directly paid were $16k)." }, { "docid": "453656", "title": "", "text": "you are discounting the cash used, the discount rate for cash should be whatever you determine is your risk premium over the risk free rate not the equity growth rate. if equity growth rate is above your determined required return the equity investment is wealth destroying and if it is above that then it is wealth increasing. The difficulty I see is that the scenario is all wrong, what you are really after is a rent vs buy decision. Do I take this money and rent a place or do I buy a house? In either case you could invest the remainder after paying your rent/mortgage in the equity market no? So what really matters is the difference in cost between renting and buying. Let (EGR)=equity growth rate Rent = rent M = Mortgage payment I = income HA = home value appreciation Now the question is is renting or buying a better decision two scenarios, renting first PMT =(I - rent) I/y = (EGR) N =Time horizon in years FV= Gain from cf left after paying rent then discount to present day at your required rate of return to find present value now scenario for buying, this is more complicated because you are investing two different cf streams at different rates and have to calculate both and add them together. 1) CF 1 the mortgage payments buy you equity in the house which appreciates (hopefully) but can be extremely volatile. This is the cf stream scenario one doesnt have, when renting the rent payments poof disappear forever and you earn nothing on them 2) The income left after mortgage payment which can be invested at the market rate measured the same way as above. **This is extremely simplistic and doesnt take into account expected maintenance, property taxes and other costs intrinsic to the investment. It also doesnt take into account the lost down payment setting you well behind the renter. TL DR: It is complicated but you determine the required return(discount rate) based on the perceived risk of the investment and your particular views and it doesnt matter what expected growth rates are since any investment with an expected growth rate below your required rate is wealth destroying since you are paying for something which returns cash flows too small for its risk level. If you use growth rates as discount rates then all your investments will net to zero" }, { "docid": "408112", "title": "", "text": "\"Thinking about the business overall, your \"\"profit\"\" would be: Since this is a sole proprietorship, the taxes are going to depend on your marginal tax rate. If you file jointly, your income will determine what your marginal tax rate is. If you file separately, there likely wouldn't be any tax on that income since it's less than the standard deduction, but you lose benefits of filing jointly (combined exemptions, etc.) So think about how much she would charge, what expenses are involved (before taxes), what the taxes would be on that profit, and what the \"\"opportunity costs\"\" are - is it worth time away from the kids/hobbies/etc. for that hobby? How much should a hobby business make to make it worth the effort of charging for such services? That would fall in the \"\"expense\"\" section. Are you talking about the actual costs (tax prep, etc.) or just the hassle of collecting, accounting, etc. Certainly those are a consideration but it's harder to quantify that. If you can come up with some sort of cost then certainly it would fit in the overall value equation. I'm not sure using additional Social Security benefits as a gauge is helpful, since you wouldn't see those benefits until you're of retirement age (according to SS) and a lot can happen between now and then.\"" }, { "docid": "451849", "title": "", "text": "\"The general answer is: \"\"it depends on how long you want to live there\"\". Here is a good calculator to figure it out: http://www.nytimes.com/interactive/business/buy-rent-calculator.html Basically, if you plan to move in a few years, then renting makes more sense. It is a lot easier to move from an apartment when your lease is up versus selling a house, which can be subject to fluctuations in the real-estate market. As an example, during the real estate bubble, a lot of \"\"young professional\"\" types bought condos and town homes instead of renting. Now these people are married with kids, need to move somewhere bigger, but they can't get rid of their old place because they can't sell it for what they still owe. If these people had rented for a few years, they would be in a better position financially. (Many people fell for the mantra \"\"If you are renting, you are throwing your money away\"\", without looking at the long-term implications.) However, your question is a little unique, because you mentioned renting for the rest of your life, and putting the savings into an investment, which is a cool idea. (Thinking outside the box, I like it.) I'm going to assume you mean \"\"rent the same place for many years\"\" versus \"\"moving around the country every few years\"\". If you are staying in one place for a long time, I am going to say that buying a house is probably a better option. Here's why: So what about investing? Let's look at some numbers: So, based on the above, I say that buying a house is the way to go (as long as you plan to live in the same place for several years). However, if you could find a better investment than the Dow, or if mortgage interest rates change drastically, things could tip in another direction. Addendum: CrimsonX brought up a good point about the costs of owning a house (upkeep and property taxes), which I didn't mention above. However, I don't think they change my answer. If you rent, you are still paying those costs. They are just hidden from you. Your landlord pays the contractor or the tax man, and then you pay the landlord as part of your rent.\"" } ]

[ { "docid": "410128", "title": "", "text": "In Canada I think you'd do it as a % of square footage. For example: Then you can count 20% of the cost of the of renting the apartment as a business expense. I expect that conventions (i.e. that what's accepted rather than challenged by the tax authorities) may vary from country to country." } ]

[ { "docid": "65835", "title": "", "text": "\"Consider property taxes (school, municipal, county, etc.) summing to 10% of the property value. So each year, another .02N is removed. Assume the property value rises with inflation. Allow for a 5% after inflation return on a 70/30 stock bond mix for N. After inflation return. Let's assume a 20% rate. And let's bump the .05N after inflation to .07N before inflation. Inflation is still taxable. Result Drop in value of investment funds due to purchase. Return after inflation. After-inflation return minus property taxes. Taxes are on the return including inflation, so we'll assume .06N and a 20% rate (may be lower than that, but better safe than sorry). Amount left. If no property, you would have .036N to live on after taxes. But with the property, that drops to .008N. Given the constraints of the problem, .008N could be anywhere from $8k to $80k. So if we ignore housing, can you live on $8k a year? If so, then no problem. If not, then you need to constrain N more or make do with less house. On the bright side, you don't have to pay rent out of the .008N. You still need housing out of the .036N without the house. These formulas should be considered examples. I don't know how much your property taxes might be. Nor do I know how much you'll pay in taxes. Heck, I don't know that you'll average a 5% return after inflation. You may have to put some of the money into cash equivalents with negligible return. But this should allow you to research more what your situation really is. If we set returns to 3.5% after inflation and 2.4% after inflation and taxes, that changes the numbers slightly but importantly. The \"\"no house\"\" number becomes .024N. The \"\"with house\"\" number becomes So that's $24,000 (which needs to include rent) versus -$800 (no rent needed). There is not enough money in that plan to have any remainder to live on in the \"\"with house\"\" option. Given the constraints for N and these assumptions about returns, you would be $800 to $8000 short every year. This continues to assume that property taxes are 10% of the property value annually. Lower property taxes would of course make this better. Higher property taxes would be even less feasible. When comparing to people with homes, remember the option of selling the home. If you sell your .2N home for .2N and buy a .08N condo instead, that's not just .12N more that is invested. You'll also have less tied up with property taxes. It's a lot easier to live on $20k than $8k. Or do a reverse mortgage where the lender pays the property taxes. You'll get some more savings up front, have a place to live while you're alive, and save money annually. There are options with a house that you don't have without one.\"" }, { "docid": "510219", "title": "", "text": "I recognize you are probably somewhere in the middle of various steps here... but I'd start and go through one-by-one in a disciplined way. That helps to cut through the overwhelming torrent of information that's out there. Here is my start at a general checklist: others can feel free to edit it or add their input. How 'much' house would you like to buy in terms of $$$ and bedrooms/sq ft. You can start pretty general here, but the idea is to figure out if you can actually afford a brand new 4bd/3ba 2,500 sq ft house (upwards of $500K in your neck of the woods according to trulia.com). Or maybe with your current resources you'll be looking at something like a townhome that is more entry-level but still yours. Some might recommend that this is a good time to talk to any significant others/whomevers and understand/manage expectations. My wife usually cares a lot about schools at this stage, but I think it's too early. Just ballpark whether you're looking at a $500K house, a $300K house, or a $200K townhome. How much house can you afford in terms of monthly payments only... (not considering other costs like utilities yet). Looking around at calculators like this one from bankrate.com can help you figure this out. Set the interest rate @ 5%, 30-year loan, and change the 'mortgage amount' until you have something that is about 80%-90% of what you currently pay in rent each month. I'll get to 'why' to undershoot your rent payment later. Crap... can't afford my dream house... If you don't have the down payment to make the numbers work (remember that this doesn't even include closing costs yet), there are other loan options like FHA loans that can go as low as about 5% down payment. The math would be the same but you replace 0.8 with 0.95. Then, look at your personal budget. Come up with general estimates of what you currently bring in and spend each month overall. Just ballpark it... Next, figure what you currently spend towards housing in particular. Whether you are paying for it or your landlord is paying for it, someone pays for a lot of different things for housing. For now, my list would include (1) Rent, (2) Mortgage Payment, (3) Electricity, (4) Gas, (5) Sewer, (6) Water, (7) Trash, (8) Other utilities... TV/Internet/Phone, (9) Property Insurance, (10) Renter's Insurance, and (11) Property Taxes. I would put it into a table in Excel somewhere that has 3 columns... The first has the labels, the second will have what you spend now, and the third will have what you might spend on each one as a homeowner. If you pay it now, put it in the second column. If your landlord pays it right now, leave it out as that's included in your rent payment. Obviously each cell won't be filled in. Fill in the rest of the third column. You won't pay rent anymore, but you will have a mortgage payment. You probably have a good estimate of any electricity bills, etc that you currently pay, but those may be slightly higher in a house vs. a condo or an apartment. As for things like sewer, water, trash or other 'community' utilities, my bet would be that your landlord pays for those. If you need a good estimate ask around with some co-workers or friends that own their own places. They would also be a good resource for property insurance estimates... shooting from the hip I would say about $100/month based on this website. (I'm not affiliated). The real 'ouch' is going to be property tax rates. Based on the data from this website, your county is about 9% of property value. So add that into the third column as well. Can you really afford a house? round 2 Now... add up the third column and see how that monthly expense amount on housing compares against your current monthly budget. If it's over, you don't have to give up, but you should just understand how much your decision to purchase a house will strain your budget. Also, you should use this information to look again at 'how much house can you afford.' Now, do some more research. If you need to get a revised loan amount based on the FHA loan decision, then use the bankrate calculator to find out what the monthly payment is for a 95% loan against your target price. But remember that an FHA loan will also carry PMI that is extra on top of your monthly payment. Or, if you need to revise your mortgage payment downwards (or upwards) change the loan amount accordingly. Once you've got the numbers set, look for properties that fit. This way you can have a meaningful discussion with yourself or other stakeholders about what you can afford. As far as arranging financing... a realtor will be able and willing to point you in the right direction for obtaining funding, etc. And at that point you can just check anything you're offered by shopping interest rates, etc against what the internet has to say. Feel free to ask us, too... it's hard to give much better direction without more specifics." }, { "docid": "296345", "title": "", "text": "\"From Rich Dad, Poor Dad. 3 Major Things: With rental real estate, in addition to mortgage interest, you also deduct property taxes, and must claim depreciation (cost of house / 27.5 years) Business Expenses. For example, buy a yacht and put it in a charter fleet. Deduct interest on the loan, depreciation of the asset, property taxes, upkeep of the boat. Your \"\"business\"\" earns profit from chartering the boat, which if I recall correctly is taxed at a lower rate. You get to go sailing for free. Then there was the concept of subdividing the businesses. If you own a restaurant, create another business to own the property, and the equipment used in the company. Then lease the equipment and rent the land to the restaurant. Now admittedly I thought this was like the Daylight Savings plan of tax avoidance, I mean now aren't you essentially having two companies paying half the taxes. I am sure there are well paid CPAs that make the math happen, perhaps using insurance plans.. Perhaps each business funds a \"\"whole life\"\" insurance account, and contributes vast amounts into that. Then you take a loan from your insurance account. Loans of course are not income, so not taxed. The third way is to create your own bank. Banks are required to have reserves of 9%. Meaning if I have $100 dollars, the FDIA allows me to loan $1,111. I then charge you 20% interest, or $222/yr. Now how much can I loan? ...well you can see how profitable that is. Sure you pay taxes, but when you print your own money who cares? Most of this is just gleamed from books, and government publications, but that was my general understanding of it. Feel free to correct the finer points.\"" }, { "docid": "485898", "title": "", "text": "Getting the first year right for any rental property is key. It is even more complex when you rent a room, or rent via a service like AirBnB. Get professional tax advice. For you the IRS rules are covered in Tax Topic 415 Renting Residential and Vacation Property and IRS pub 527 Residential Rental Property There is a special rule if you use a dwelling unit as a personal residence and rent it for fewer than 15 days. In this case, do not report any of the rental income and do not deduct any expenses as rental expenses. If you reach that reporting threshold the IRS will now expect you to to have to report the income, and address the items such as depreciation. When you go to sell the house you will again have to address depreciation. All of this adds complexity to your tax situation. The best advice is to make sure that in a tax year you don't cross that threshold. When you have a house that is part personal residence, and part rental property some parts of the tax code become complex. You will have to divide all the expenses (mortgage, property tax, insurance) and split it between the two uses. You will also have to take that rental portion of the property and depreciation it. You will need to determine the value of the property before the split and then determine the value of the rental portion at the time of the split. From then on, you will follow the IRS regulations for depreciation of the rental portion until you either convert it back to non-rental or sell the property. When the property is sold the portion of the sales price will be associated with the rental property, and you will need to determine if the rental property is sold for a profit or a loss. You will also have to recapture the depreciation. It is possible that one portion of the property could show a loss, and the other part of the property a gain depending on house prices over the decades. You can expect that AirBnB will collect tax info and send it to the IRS As a US company, we’re required by US law to collect taxpayer information from hosts who appear to have US-sourced income. Virginia will piggyback onto the IRS rules. Local law must be researched because they may limit what type of rentals are allowed. Local law could be state, or county/city/town. Even zoning regulations could apply. Also check any documents from your Home Owners Association, they may address running a business or renting a property. You may need to adjust your insurance policy regarding having tenants. You may also want to look at insurance to protect you if a renter is injured." }, { "docid": "549601", "title": "", "text": "I know of no generic formula for determining if an investment property is a good investment, besides the trivial formula. Make sure your income is greater than your expenses, and hope the value of the property doesn't drop. Some people will tell you to expect the monthly rent to be a fixed percentage of the purchase price, but that is a goal not a certainty. It is also impossible to estimate the difficulty renting the property, or how long the roof will last. Taxes can't be predicted, as the value of the house increase, so do the property taxes, but you might not be able to increase the rent. You can't even predict the quality of the tenant. Will they damage the property? Or skip out early? You will need somebody who knows the local market to estimate the local conditions, and help you determine the estimated costs and income based on the actual property involved." }, { "docid": "565409", "title": "", "text": "As a landlord for 14 years with 10 properties, I can give a few pointers: be able and skilled enough to perform the majority of maintenance because this is your biggest expense otherwise. it will shock you how much maintenance rental units require. don't invest in real estate where the locality/state favors the tenant (e.g., New York City) in disputes. A great state is Florida where you can have someone evicted very quickly. require a minimum credit score of 620 for all tenants over 21. This seems to be the magic number that keeps most of the nightmare tenants out makes sure they have a job nearby that pays at least three times their annual rent every renewal, adjust your tenant's rent to be approximately 5% less than going rates in your area. Use Zillow as a guide. Keeping just below market rates keeps tenants from moving to cheaper options. do not rent to anyone under 30 and single. Trust me trust me trust me. you can't legally do this officially, but do it while offering another acceptable reason for rejection; there's always something you could say that's legitimate (bad credit, or chose another tenant, etc.) charge a 5% late fee starting 10 days after the rent is due. 20 days late, file for eviction to let the tenant know you mean business. Don't sink yourself too much in debt, put enough money down so that you start profitable. I made the mistake of burying myself and I haven't barely been able to breathe for the entire 14 years. It's just now finally coming into profitability. Don't get adjustable rate or balloon loans under any circumstances. Fixed 30 only. You can pay it down in 20 years and get the same benefits as if you got a fixed 20, but you will want the option of paying less some months so get the 30 and treat it like a 20. don't even try to find your own tenants. Use a realtor and take the 10% cost hit. They actually save you money because they can show your place to a lot more prospective tenants and it will be rented much sooner. Empty place = empty wallet. Also, block out the part of the realtor's agreement-to-lease where it states they keep getting the 10% every year thereafter. Most realtors will go along with this just to get the first year, but if they don't, find another realtor. buy all in the same community if you can, then you can use the same vendor list, the same lease agreement, the same realtor, the same documentation, spreadsheets, etc. Much much easier to have everything a clone. They say don't put all your eggs in one basket, but the reality is, running a bunch of properties is a lot of work, and the more similar they are, the more you can duplicate your work for free. That's worth a lot more day-to-day than the remote chance your entire community goes up in flames" }, { "docid": "285449", "title": "", "text": "You should have a partnership agreement of some sort. The reason partnership agreements exist is so nobody can change the game because of the outcome. I'd say the most typical partnership agreement is that everyone gets an equal cut, meaning that everyone also makes an equal contribution. If you have start up expenses of $10,000, you'd each contribute $5,000. Separately, you can determine ownership share by contribution amounts, maybe one of you contributed $2,000 and the other $8,000; this would be an 80/20 split. The performance of the operation doesn't have anything to do with determining how to divide the pie, your partnership agreement determines that. How much have you each contributed and what agreement did you make before you decided to be partners? If you have a poor performing business segment, then the partnership should get together and consider adjusting or stopping that line of business. But you don't change how the pie is divided because of it; unless your partnership agreement says you do." }, { "docid": "453656", "title": "", "text": "you are discounting the cash used, the discount rate for cash should be whatever you determine is your risk premium over the risk free rate not the equity growth rate. if equity growth rate is above your determined required return the equity investment is wealth destroying and if it is above that then it is wealth increasing. The difficulty I see is that the scenario is all wrong, what you are really after is a rent vs buy decision. Do I take this money and rent a place or do I buy a house? In either case you could invest the remainder after paying your rent/mortgage in the equity market no? So what really matters is the difference in cost between renting and buying. Let (EGR)=equity growth rate Rent = rent M = Mortgage payment I = income HA = home value appreciation Now the question is is renting or buying a better decision two scenarios, renting first PMT =(I - rent) I/y = (EGR) N =Time horizon in years FV= Gain from cf left after paying rent then discount to present day at your required rate of return to find present value now scenario for buying, this is more complicated because you are investing two different cf streams at different rates and have to calculate both and add them together. 1) CF 1 the mortgage payments buy you equity in the house which appreciates (hopefully) but can be extremely volatile. This is the cf stream scenario one doesnt have, when renting the rent payments poof disappear forever and you earn nothing on them 2) The income left after mortgage payment which can be invested at the market rate measured the same way as above. **This is extremely simplistic and doesnt take into account expected maintenance, property taxes and other costs intrinsic to the investment. It also doesnt take into account the lost down payment setting you well behind the renter. TL DR: It is complicated but you determine the required return(discount rate) based on the perceived risk of the investment and your particular views and it doesnt matter what expected growth rates are since any investment with an expected growth rate below your required rate is wealth destroying since you are paying for something which returns cash flows too small for its risk level. If you use growth rates as discount rates then all your investments will net to zero" }, { "docid": "67816", "title": "", "text": "\"Even if the price of your home did match inflation or better — and that's a question I'll let the other answers address — I propose that owning a home, by itself, is not a sufficient hedge against inflation. Consider: Inflation will inflate your living expenses. If you're lucky, they'll inflate at the average. If you're unlucky, a change in your spending patterns (perhaps age-related) could result in your expenses rising faster than inflation. (Look at the sub-indexes of the CPI.) Without income also rising with inflation (or better), how will you cope with rising living expenses? Each passing year, advancing living expenses risk eclipsing a static income. Your home is an illiquid asset. Generally speaking, it neither generates income for you, nor can you sell only a portion. At best, owning your principal residence helps you avoid a rent expense and inflation in rents — but rent is only one of many living expenses. Some consider a reverse-mortgage an option to tap home equity, but it has a high cost. In other words: If you don't want to be forced to liquidate [sell] your home, you'll also need to look at ways to ensure your income sources rise with inflation. i.e. look at your cash flow, not just your net worth. Hence: investing in housing, as in your own principal residence, is not an adequate hedge against inflation. If you owned additional properties to generate rental income, and you retained pricing power so you could increase the rent charged at least in line with inflation, your situation would be somewhat improved — except you would, perhaps, be adopting another problem: Too high a concentration in a single asset class. Consequently, I would look at ways other than housing to hedge against inflation. Consider other kinds of investments. \"\"Safe as houses\"\" may be a cliché, but it is no guarantee.\"" }, { "docid": "363120", "title": "", "text": "Firstly, I'm going to do what you said and analyze your question taking your entire family's finances into account. That means giving you an answer that maximizes your family's total wealth rather then just your own. If instead of that your question really was, should I let my parents buy me a house and live rent free, then obviously you should do that (assuming your parents can afford it and you aren't taking advantage people who need to be saving for retirement and not wasting it on a 25 y/o who should be able to support him / herself). This is really an easy question assuming you are willing to listen to math. Goto the new york times rent vs buy calculator and plug in the numbers: http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html Firstly, if you do what you say you want to do buy the house all cash and live there for 4 years, it would be the equivalent of paying 1151 / month in rent once you factor in transaction costs, taxes, opportunity costs, etc. Take a look at the calculator, it's very detailed. This is why you should never buy houses all cash (unless its a negotiating tactic in a hot market, and even then you should refi after). Mortgage rates are super low right now, all that money sitting in the house is appreciating at maybe the rate of inflation (assuming the house value isn't going down which it can very easily do if you don't maintain it, another cost you need to factor in). Instead, you could be invested in the stock market getting 8%, the lost opportunity cost there is huge. I'm not even considering your suggestion that you hang onto the house after you move out in 4 years. That's a terrible idea. Investment properties should be at a maximum value of 10x the yearly rent. I wouldn't pay more then 72K for a house / apartment that rents for only 600 / month (and even then I would look for a better deal, which you can find if you time things right). Don't believe me? Just do the numbers. Renting your 200K house for 600 / month is 7200 / year. Figure you'll need to spend 1% / year (I'm being optimistic here) on maintanence / vacancy (and I'm not even considering your time dealing with tenants). Plus another 1% or so on property tax. That's 4K / year, so your total profit is 3200 which is a return of only 1.6% on your 200K. You can get 1% in an ally savings account for comparison. Really you are much better off investing in a diversified portfolio. You only need 6 months living expenses in cash, so unless your family is ridicuouly wealthy (In which case you should be asking your financial planner what to do and not stack exchange), I have no idea why your parents have 200K sitting around in a savings account earning 0. Open a vanguard account for them and put that money in VTI and your family will be much better off 5 years from now then if you buy that money pit (err house). If risk is a concern, diversify more. I have some money invested with a robo advisor. They do charge a small fee, but it's set it and forget it with auto diversification and tax loss harvesting. Bottom line is, get that money invested in something, having it sitting in a bank account earning 0 is probably the second worst thing you could do with next to buying this house." }, { "docid": "546528", "title": "", "text": "\"Based on what you asked and your various comments on other answers, this is the first time that you will be making an offer to buy a house, and it seems that the seller is not using a real-estate agent to sell the house, that is, it is what is called a FSBO (for sale by owner) property (and you can learn a lot of about the seller's perspective by visiting fsbo.com). On the other hand, you are a FTB (first-time buyer) and I strongly recommend that you find out about the purchase process by Googling for \"\"first-time home buyer\"\" and reading some of the articles there. But most important, I urge you DO NOT make a written offer to purchase the property until you understand a lot more than you currently do, and a lot more than all the answers here are telling you about making an offer to buy this property. Even when you feel absolutely confident that you understand everything, hire a real-estate lawyer or a real-estate agent to write the actual offer itself (the agent might well use a standard purchase offer form that his company uses, or the State mandates, and just fill in the blanks). Yes, you will need to pay a fee to these people but it is very important for your own protection, and so don't just wing it when making an offer to purchase. As to how much you should offer, it depends on how much you can afford to pay. I will ignore the possibility that you are rich enough that you can pay cash for the purchase and assume that you will, like most people, be needing to get a mortgage loan to buy the house. Most banks prefer not to lend more than 80% of the appraised value of the house, with the balance of the purchase price coming from your personal funds. They will in some cases, loan more than 80% but will usually charge higher interest rate on the loan, require you to pay mortgage insurance, etc. Now, the appraised value is not determined until the bank sends its own appraiser to look at the property, and this does not happen until your bid has been accepted by the seller. What if your bid (say $500K) is much larger than the appraised value $400K on which the bank is willing to lend you only $320K ? Well, you can still proceed with the deal if you have $180K available to make the pay the rest. Or, you can let the deal fall apart if you have made a properly written offer that contains the usual contingency clause that you will be applying for a mortgage of $400K at rate not to exceed x% and that if you can't get a mortgage commitment within y days, the deal is off. Absent such a clause, you will lose the earnest money that you put into escrow for failure to follow through with the contract to purchase for $500K. Making an offer in the same ballpark as the market value lessens the chances of having the deal fall through. Note also that even if the appraised value is $500K, the bank might refuse to lend you $400K if your loan application and credit report suggest that you will have difficulty making the payments on a $400K mortgage. It is a good idea to get a pre-approval from a lender saying that based on the financial information that you have provided, you will likely be approved for a mortgage of $Z (that is, the bank thinks that you can afford the payments on a mortgage of as much as $Z). That way, you have some feel for how much house you can afford, and that should affect what kinds of property you should be bidding on.\"" }, { "docid": "253552", "title": "", "text": "\"First of all, the numbers you give are most probably nowhere near the total expenses you have/need to budget: Maybe you should have a look at the expenses you had over the last years (look at how much money came in and how much went to the savings and compare this expenses to the sum of all the expenses you have on your list of expenses as plausibility check. Just starting on some numbers you give and assuming the house is the main goal. House of 300 - 500 k€, assuming downpayment of 30 - 40 %, i.e. somewhere between 90 and 200 k€. I'll go on calculating with 150 k€ which would be 50 % of 300 k€ or 30 % of 500 k€. You want to be there in 8 - 15 a: this means saving 10 - 19 k€ per year. 19 k€/a is clearly impossible with 20 k€ net wage. 10 k€ with 20 k€ net wage means a savings quote of 50 %, so for each € you spend, one goes towards the house. This is doable in the sense that if you continue with 4 k€/a for rent plus a Harz 4 (= 400 €/month) style of life, that would put you to 9 k€ expenses/a, thus 1 k€ saving for unexpected disaster (I'd actually first get a couple of k€ together for such things, and then go as much as possible towards the house). Still, this is not the life style the rest of your goals sounds like. (You can update this somewhat with the expected income of your girlfriend/wife. But remember that she needs food and clothes as well and you assume she'll need a car of her own) Let me rephrase the savings goal of 150 k€: you'd try to save 3 times the median German household equity within 8 to 15 years. This should tell you that it is a very steep proposition. On the other hand, e.g. Slowakians manage to have a median household equity of ca 60 k€ out of a median income that is roughly half the median income in Germany. So again it is somehow possible, but it will be really tough to live a life style like a Slowakian or Harz 4ler between peers that spend roughly everything (good approximation as we're talking about savings rates above 50 % of net income) they earn. I think the \"\"easiest\"\" way to get your savings going is to postpone lifestyle upgrades. On the other hand, around Waldeck, 150 k€ would buy you a complete new house of the same size that costs 300 - 500 k€ around Darmstadt. So if you really want to go for the house, I'd recommend not only to save as hard as you can*, but also to look out for possibilities to relocate to a cheaper area. 8 - 15 years should be enough time to decide what area you'd like and then to look for an opportunity without too much pressure. And actually this should be enough time so that also your girlfriend/wife could get herself transferred to another Bundesland. * In reality saving as hard as possible will probably get you nowhere near 150 k€ (there are very few people who manage to do this - though they exist), but if you get to 75 k€ that would mean a reasonably good position for both starting negotiations with the bank about buying a 150 k€ house plus the corresponding payment of the mortgage. If you get there within less than 15 years that would also leave some air in case you change opinion with regard to kids and then leaves a reasonable amount of time to put together your pension. Consider your psychology about saving towards the house. Even if both of you know that you want it really hard, it may be good to enter a building savings contract (15 years should be reasonable for that way) which will enforce you to keep up the savings rate and also does not allow you to divert money for other purposes. However, I'd say that 6 months into the first job it may be a bit early to fix such savings rates. Maybe for the beginning a savings account that includes some hassle to get the money out again (set low limit and allow any outgoing money to go only to another account of yours) with an automatic savings deposit every month is a way how to safely determine the savings rate you can manage. Maybe you can use this to first put together your new emergency savings which should be first priority anyways. If you want to cut expenses in order to save, look at the recommendations for people who try to get out of debt: budget your expenses, cook yourself and enjoy this (maybe taking a cooking class together with your girlfriend is a lot of fun, leads to food that may even be more to your taste than restaurant stuff - and is much cheaper), keep book, pay in cash (not by card) and so on. If you're not a DIY person, try whether you could enjoy becoming one - no magic involved there. I guess the most important point is to find out how much you want the house and then how hard you are willing to save. This is something only you and your girlfriend can decide (together!). IMHO you really don't need to invest (unless you drop the house plan), you need to save towards your goals. You may decide to invest a small part of the money while saving in order to learn slowly how that works, but if the house goal is already kind of fixed in time, you don't want to find yourself in the situation that you have to get out of investments at a bad time in order to be able to buy the house. Even if you consider 15 years long enough to do some investing now and then get out some time during the next 15 years, you don't have any money to invest now. Later, the risk posed by the fixed point in time when you need the money is too large: Considering the rather steep saving propositions, the marginal costs of having less money are really large. This means you don't want to go for risky investments => plain old saving is what you need. Consider also that low house prices tend to come during economic crisis (people cannot pay mortgage and have to sell) so within the time window, you want to have your money for anticyclic buying if possible.\"" }, { "docid": "458183", "title": "", "text": "Here would be the general steps to my mind for creating such a plan: Write out the final desired outcome. Is it $x in y years to fund your retirement? Is it $a in b years to put as a house down payment? This is the first step in defining how much money you want at what point in time. Consider what is your risk tolerance and how much time do you plan on spending in this plan. Is it rebalancing once a quarter and that's it or do you plan on doing monthly research and making tweaks all the time? This is slightly different from the first where one has to be mindful of how much volatility would one handle and what time commitment does one have for an investing strategy. Also, how much money would you be adding to the investments on what kind of time table would also be worth noting here. Construct the asset allocation based on the previous two steps along with historical returns averaged out to be a first draft of what you are buying in general. Is it US stocks? Is it a short-term bond fund? There are more than a few choices here that may make sense and it is worth considering based on the first couple of responses that determine what this will look like. Retirement in 40 years may be quite different than a house down payment in 2 years for example. Determine what brokerages or fund companies would offer such funds along with what types of accounts you'd want to have as in some countries there may be tax-advantaged accounts that may be useful to use here. This is where you're almost ready to start by doing the homework of figuring out how will things work. This may vary depending on one's jurisdiction. Get the applications from whatever institutions you'll be using and run with the desired asset allocation across various funds and accounts. Note that in the first few steps there were points of being aware of how much would you have, how aggressive are you investing and so forth. This is where you actually send in the money and get things rolling. Run with the plan and make tweaks as needed to achieve result, hopefully desired or better." }, { "docid": "434257", "title": "", "text": "\"Accounting for this properly is not a trivial matter, and you would be wise to pay a little extra to talk with a lawyer and/or CPA to ensure the precise wording. How best to structure such an arrangement will depend upon your particular jurisdiction, as this is not a federal matter - you need someone licensed to advise in your particular state at least. The law of real estate co-ownership (as defined on a deed) is not sufficient for the task you are asking of it - you need something more sophisticated. Family Partnership (we'll call it FP) is created (LLC, LLP, whatever). We'll say April + A-Husband gets 50%, and Sister gets 50% equity (how you should handle ownership with your husband is outside the scope of this answer, but you should probably talk it over with a lawyer and this will depend on your state!). A loan is taken out to buy the property, in this case with all partners personally guaranteeing the loan equally, but the loan is really being taken out by FP. The mortgage should probably show 100% ownership by FP, not by any of you individually - you will only be guaranteeing the loan, and your ownership is purely through the partnership. You and your husband put $20,000 into the partnership. The FP now lists a $20,000 liability to you, and a $20,000 asset in cash. FP buys the $320,000 house (increase assets) with a $300,000 mortgage (liability) and $20,000 cash (decrease assets). Equity in the partnership is $0 right now. The ownership at present is clear. You own 50% of $0, and your sister owns 50% of $0. Where'd your money go?! Simple - it's a liability of the partnership, so you and your husband are together owed $20,000 by the partnership before any equity exists. Everything balances nicely at this point. Note that you should account for paying closing costs the same as you considered the down payment - that money should be paid back to you before any is doled out as investment profit! Now, how do you handle mortgage payments? This actually isn't as hard as it sounds, thanks to the nature of a partnership and proper business accounting. With a good foundation the rest of the building proceeds quite cleanly. On month 1 your sister pays $1400 into the partnership, while you pay $645 into the partnership. FP will record an increase in assets (cash) of $1800, an increase in liability to your sister of $1400, and an increase in liability to you of $645. FP will then record a decrease in cash assets of $1800 to pay the mortgage, with a matching increase in cost account for the mortgage. No net change in equity, but your individual contributions are still preserved. Let's say that now after only 1 month you decide to sell the property - someone makes an offer you just can't refuse of $350,000 dollars (we'll pretend all the closing costs disappeared in buying and selling, but it should be clear how to account for those as I mention earlier). Now what happens? FP gets an increase in cash assets of $350,000, decreases the house asset ($320,000 - original purchase price), and pays off the mortgage - for simplicity let's pretend it's still $300,000 somehow. Now there's $50,000 in cash left in the partnership - who's money is it? By accounting for the house this way, the answer is easily determined. First all investments are paid back - so you get back $20,000 for the down payment, $645 for your mortgage payments so far, and your sister gets back $1400 for her mortgage payment. There is now $27,995 left, and by being equal partners you get to split it - 13,977 to you and your husband and the same amount to your sister (I'm keeping the extra dollar for my advice to talk to a lawyer/CPA). What About Getting To Live There? The fact is that your sister is getting a little something extra out of the deal - she get's the live there! How do you account for that? Well, you might just be calling it a gift. The problem is you aren't in any way, shape, or form putting that in writing, assigning it a value, nothing. Also, what do you do if you want to sell/cash out or at least get rid of the mortgage, as it will be showing up as a debt on your credit report and will effect your ability to secure financing of your own in the future if you decide to buy a house for your husband and yourself? Now this is the kind of stuff where families get in trouble. You are mixing personal lives and business arrangements, and some things are not written down (like the right to occupy the property) and this can really get messy. Would evicting your sister to sell the house before you all go bankrupt on a bad deal make future family gatherings tense? I'm betting it might. There should be a carefully worded lease probably from the partnership to your sister. That would help protect you from extra court costs in trying to determine who has the rights to occupy the property, especially if it's also written up as part of the partnership agreement...but now you are building the potential for eviction proceedings against your sister right into an investment deal? Ugh, what a potential nightmare! And done right, there should probably be some dollar value assigned to the right to live there and use the property. Unless you just want to really gift that to your sister, but this can be a kind of invisible and poorly quantified gift - and those don't usually work very well psychologically. And it also means she's going to be getting an awfully larger benefit from this \"\"investment\"\" than you and your husband - do you think that might cause animosity over dozens and dozens of writing out the check to pay for the property while not realizing any direct benefit while you pay to keep up your own living circumstances too? In short, you need a legal structure that can properly account for the fact that you are starting out in-equal contributors to your scheme, and ongoing contributions will be different over time too. What if she falls on hard times and you make a few of the mortgage payments? What if she wants to redo the bathroom and insists on paying for the whole thing herself or with her own loan, etc? With a properly documented partnership - or equivalent such business entity - these questions are easily resolved. They can be equitably handled by a court in event of family squabble, divorce, death, bankruptcy, emergency liquidation, early sale, refinance - you name it. No percentage of simple co-ownership recorded on a deed can do any of this for you. No math can provide you the proper protection that a properly organized business entity can. I would thus strongly advise you, your husband, and your sister to spend the comparatively tiny amount of extra money to get advice from a real estate/investment lawyer/CPA to get you set up right. Keep all receipts and you can pay a book keeper or the accountant to do end of the year taxes, and answer questions that will come up like how to properly account for things like depreciation on taxes. Your intuition that you should make sure things are formally written up in times when everyone is on good terms is extremely wise, so please follow it up with in-person paid consultation from an expert. And no matter what, this deal as presently structured has a really large built-in potential for heartache as you have three partners AND one of the partners is also renting the property partially from themselves while putting no money down? This has a great potential to be a train wreck, so please do look into what would happen if these went wrong into some more detail and write up in advance - in a legally binding way - what all parties rights and responsibilities are.\"" }, { "docid": "297427", "title": "", "text": "First, determine the workload he will expect. Will you have to quit your other work, either for time or for competition? How much of your current business will be subsumed into his business, if any? Make sure to understand what he wants from you. If you make an agreement, set it in writing and set some clear expectations about what will happen to your business (e.g. it continues and is not part of your association with the client). Because he was a client for your current business, it can blur the lines. Second, if you join him, make sure there is a business entity. By working together for profit, you will have already formed a partnership for tax purposes. Best to get an entity, both for the legal protection and also for the clarity of law and accounting. LLCs are simplest for small ventures; C corps are useful if you have lots of early losses and owners that can't use them personally, or if you want to be properly formed for easy consumption by a strategic. Most VCs and super-angels prefer everybody be a straight C. Again, remember to define, as necessary, what you are contributing to be an owner and what you are retaining (your original business, which for simplicity may already be in an entity). As part of this process, make sure he defines the cap table and any outstanding loans. Auntie June and Cousin Steve might think their gifts to him were loans or equity purchases; best to clear this issue up early before there's any more money in it. Third, with regard to price, that is an intensely variable question. It matters what the cap table looks like, how early you are, how much work he's already done, how much work remains to be done, and how much it will pay off. Also, if you do it, expect to be diluted by other employees, angels, VCs, other investors, strategics, and so on. Luckily, more investors usually indicates a growing pie, so the dilution may not be at all painful. But it should still be on your horizon. You also need to consider your faith in your prospective partner's ability to run the business and to be a trustworthy partner (so you don't get Zuckerberg'd), and to market the business and the product to customers and investors. If you don't like the prospects, then opt for cash. If you like the business but want to hedge, ask for compensation plus equity. There are other tricks you could use to get out early, like forced redemption, but they probably wouldn't help either because it'd sour your relationship or the first VC or knowledgeable angel to come along will want you to relinquish that sort of right. It probably comes down to a basic question of your need for cash, his willingness to let you pursue outside work (hopefully high) and your appraisal of the business' prospects." }, { "docid": "488113", "title": "", "text": "Oh, man, you are in for a life of disappointment if you think it's this easy. Ask your dad why he didn't think of this idea years ago. Owning and maintaining a business is quite difficult, and the business owners I know are stressed out and work hard just like everyone else. (Except with the added benefit that many people hate them and say that they've only been successful due to dishonesty.) But, if you want to start, look at your profit and loss statement (you do calculate one, right?) and determine how much additional fixed cost you can afford. Look into local employment law with your lawyer and determine how much an employee would cost. Then figure out the duties you want them to do, and check local job postings to see if someone in your local labor market will meet those needs for the compensation you can give. If so, determine the value of those contributions. If the value is greater than the costs, go ahead and hire. Rinse and repeat." }, { "docid": "107780", "title": "", "text": "Investing is good. Insurance when you have something to insure is good. But using a single account for investing and insurance is not so good. You need to determine how much you need to invest for retirement. You also need to determine if you need life insurance. As a single person you might determine that you don't have a great need for life insurance. If you get married, or have kids, your needs may grow. So you will want to revisit your decisions every so often. You may need to save for retirement, or setup a college fund. You may need to protect your spouse or children in case you die. It doesn't seem to make sense to invest and insure in a plan with complicated rules, fees and schedules. What happens if in 3 years you need to blow it up and start over? What surrender charges will they hit you with?" }, { "docid": "451849", "title": "", "text": "\"The general answer is: \"\"it depends on how long you want to live there\"\". Here is a good calculator to figure it out: http://www.nytimes.com/interactive/business/buy-rent-calculator.html Basically, if you plan to move in a few years, then renting makes more sense. It is a lot easier to move from an apartment when your lease is up versus selling a house, which can be subject to fluctuations in the real-estate market. As an example, during the real estate bubble, a lot of \"\"young professional\"\" types bought condos and town homes instead of renting. Now these people are married with kids, need to move somewhere bigger, but they can't get rid of their old place because they can't sell it for what they still owe. If these people had rented for a few years, they would be in a better position financially. (Many people fell for the mantra \"\"If you are renting, you are throwing your money away\"\", without looking at the long-term implications.) However, your question is a little unique, because you mentioned renting for the rest of your life, and putting the savings into an investment, which is a cool idea. (Thinking outside the box, I like it.) I'm going to assume you mean \"\"rent the same place for many years\"\" versus \"\"moving around the country every few years\"\". If you are staying in one place for a long time, I am going to say that buying a house is probably a better option. Here's why: So what about investing? Let's look at some numbers: So, based on the above, I say that buying a house is the way to go (as long as you plan to live in the same place for several years). However, if you could find a better investment than the Dow, or if mortgage interest rates change drastically, things could tip in another direction. Addendum: CrimsonX brought up a good point about the costs of owning a house (upkeep and property taxes), which I didn't mention above. However, I don't think they change my answer. If you rent, you are still paying those costs. They are just hidden from you. Your landlord pays the contractor or the tax man, and then you pay the landlord as part of your rent.\"" }, { "docid": "573265", "title": "", "text": "The are a couple of explanations that I can think of; though for determining exactly what is different you will want to print out both returns and compare them line by line to see how they differ. If the company grossed up your income to account for the taxes on housing (possibly by paying the additional withholding), you may be just benefiting from them estimating your tax rate. This can especially be the case if your only work was the three month internship. They would have to assume your salary was for the entire year. There is an earned income tax credit for low wage earners that you may have qualified for (it would depend your specific circumstances if you meet the criteria). But that credit for a range of income actually pays out more the more you earn (to encourage working that extra hour instead of reducing benefit because you had another hour of employment). As for the housing subsidy itself, while the value is quite high the IRS considers that to be a taxable benefit that the employer provided you and so it needs to be added to your W-2 wages. $8k a month seems quite high, but I don't know the quality of the apartment you were provided and what the going rates are in the area. Given that you said you worked for a major tech company, I can imagine that you might have been working in an area with high rents. If the employer did gross up your paycheck so as to cover your taxes, that $24k would also include that extra tax payment (e.g. if the employer paid $8k in additional taxes for you, then the housing cost that they directly paid were $16k)." } ]

[ { "docid": "459119", "title": "", "text": "\"In the UK it all comes down to what HMRC will allow you to charge without taxing you on the \"\"rent profit\"\" and not hitting capital gain tax when you sell the house, it may not all count as your \"\"main home\"\" if some is rented out. (http://www.accountingweb.co.uk/ is a good place to ask this type of questions in the uk)\"" } ]

[ { "docid": "233413", "title": "", "text": "Myself I am in a similar position. I've had a few good conversations about this with people in the financial services industry. It all depends how much time you want to spend on yielding your profits and how much risk you would like to take. High time and high risk obviously means higher expected gain, but also has a high chance of creating a loss. Option 1: You could buy a home now and take out a mortgage with a high down payment (thus lower interest rates) and rent it out. By the time you are ready to have your own house, you can decide to either take out a mortgage on your second house and make money off your first house, and keep renting it out. Or you could move in there yourself. If you use an asset-back mortgage (i'm not sure if that is the term, but a mortgage where in the worst case you give your home back to the bank), you generally carry least risk. If you keep doing this you can have 2 houses paid off if everything goes well. Option 2: You could also invest in stocks. This all depends on the risk you want to take and the time you want to put in it. Option 3: You could also put the money in a savings account. Some banks will give you better interest rates if you lock the money for a set amount of years. Option 4: You could buy a foreclosure and try to flip it, though this is very risky and requires a lot of time. Also, it is important to also have some sort of emergency fund, so whatever you do, don't spend all your money. Save some for a rainy day :-) Hope it helps.." }, { "docid": "34246", "title": "", "text": "\"Figure out how much money you earn, what you spend it on, and how that will change when you have kids (will one of you stay at home? if not, how much will daycare cost and how do you finance the first few month when your child is still too young for daycare?) You will usually plan to spend your current Kaltmiete (rent without utilities) on your mortgage (the Darlehen that is secured by your house) - keep in mind though that a house usually has a higher utility cost than an appartment. When you've figured out what you can save/pay towards a house now and how that will change when you have kids, you can go on to the next step. If you don't want to buy now but want to commit to saving up for a house and also want to secure today's really low interest rates, consider getting a \"\"Bausparvertrag\"\". I didn't find a good translation for Bausparvertrag, so here is a short example of how it works: You take a building saving sum (Bausparsumme) of 150000€ with a savings goal (Sparziel) of 50000€ (the savings goal is usually between 20% and 50% of the sum) and then you make monthly payments into the Bausparvertrag until you reach the savings goal at which point you can take out your savings and a loan of 100000 € (or whatever your difference between the Bausparsumme and Sparziel is). If you're living in an expenisve area, you're likely to need more than 150000 but this is just an example. Upsides: Downsides: If you decide to buy sooner, you can also use your Bausparvertrag to refinance later. If you have a decent income and a permanent job, then ask your bank if they would consider financing your house now. To get a sense of what you'll be able to afford, google \"\"wie viel Haus kann ich mir leisten\"\" and use a few of the many online calculators. Remember that these websites want to sell you on the idea of buying a house instead of paying rent, so they'll usually overestimate the raise in rents - repeat the calculation with rent raise set to 0% to get a feeling for how much you'll be able to afford in today's money. Also, don't forget that you're planning to get children, so do the calculation with only one income, not two, and add the cost of raising the kids to your calculation. Once you've decided on a property, shop around a bit at different banks to get the best financing. If you decide to buy now (or soon), start looking at houses now - go to model homes (Musterhäuser) to find out what style of house you like - this is useful whether you want to buy an existing house or build a new one. If buying an existing house is an option for you, start visiting houses that are on sale in your area in order to practice what to ask and what to look for. You should have a couple of visits under your belt before you really start looking for the one you want to buy. Once you're getting closer to buying or making a contract with a construction company, consider getting an expert \"\"Bausachverständiger\"\". When buying an existing house they can help you estimate the price and also estimate the renovation cost you'll have to factor in for a certain house (new heating, better insulation, ...). When building a new house they can advise you on the contract with the construction company and also examine the construction company's work at each major step (Zwischenabnahme). Source: Own experience.\"" }, { "docid": "81530", "title": "", "text": "\"Anytime you do work without any payment until the work is complete, you are effectively extending credit to the party receiving your service. How much credit you are willing to extend will vary greatly, depending on the amount and the trustworthiness of the party. For example, if you are charging $50 for something, you probably won't bother to collect money upfront, whereas if you are charging $5,000 you probably would collect some upfront. But if the party you are working for is a large financially sound company, the number may be even much higher than $5K as you can trust you will be paid. Obviously there are many factors that go into how much credit you are willing to extend to your customer. (This is why credit reports exist for banks to determine how much credit to extend to you.) As for the specific case you are asking about, which may be classified as a decent amount of work for a small business, I would default to having a written scope of work, a place in the document for both parties to sign, and specify 50% upfront payment and 50% payment at completion. When you receive the signed document and the upfront payment (and possibly even after the check clears), you begin work. I would call this my \"\"default contract\"\" and adjust according to your needs depending on the size of the job and the trustworthiness of the customer. As for your question about how to deposit the check, that depends on what type of entity you are. If you are a sole proprietor you should ask for the checks to be made out to you. If you are a business then the checks should be made out to your business name. You don't need \"\"in trust\"\" or anything similar because your customer, after paying the upfront fee, must trust that you will do the work you promise to do, just like you have to trust that after completing the work you will receive the final payment. This is the reason the default is 50% before and after. Both parties are risking (roughly) the same amount. Tip: having done the \"\"default\"\" contract many times in my career, both as a sole proprietor and a business owner, I can assure you there is a big difference between a potential customer agreeing to something in advance, and actually writing a check. The upfront payment definitely helps weed out those that were never going to end up paying you, even if their intentions were good. Tip 2: be as specific as possible as to what the scope of work will include. If you don't, particularly with software, they'll be adding feature after feature and expecting it to be \"\"included\"\".\"" }, { "docid": "65835", "title": "", "text": "\"Consider property taxes (school, municipal, county, etc.) summing to 10% of the property value. So each year, another .02N is removed. Assume the property value rises with inflation. Allow for a 5% after inflation return on a 70/30 stock bond mix for N. After inflation return. Let's assume a 20% rate. And let's bump the .05N after inflation to .07N before inflation. Inflation is still taxable. Result Drop in value of investment funds due to purchase. Return after inflation. After-inflation return minus property taxes. Taxes are on the return including inflation, so we'll assume .06N and a 20% rate (may be lower than that, but better safe than sorry). Amount left. If no property, you would have .036N to live on after taxes. But with the property, that drops to .008N. Given the constraints of the problem, .008N could be anywhere from $8k to $80k. So if we ignore housing, can you live on $8k a year? If so, then no problem. If not, then you need to constrain N more or make do with less house. On the bright side, you don't have to pay rent out of the .008N. You still need housing out of the .036N without the house. These formulas should be considered examples. I don't know how much your property taxes might be. Nor do I know how much you'll pay in taxes. Heck, I don't know that you'll average a 5% return after inflation. You may have to put some of the money into cash equivalents with negligible return. But this should allow you to research more what your situation really is. If we set returns to 3.5% after inflation and 2.4% after inflation and taxes, that changes the numbers slightly but importantly. The \"\"no house\"\" number becomes .024N. The \"\"with house\"\" number becomes So that's $24,000 (which needs to include rent) versus -$800 (no rent needed). There is not enough money in that plan to have any remainder to live on in the \"\"with house\"\" option. Given the constraints for N and these assumptions about returns, you would be $800 to $8000 short every year. This continues to assume that property taxes are 10% of the property value annually. Lower property taxes would of course make this better. Higher property taxes would be even less feasible. When comparing to people with homes, remember the option of selling the home. If you sell your .2N home for .2N and buy a .08N condo instead, that's not just .12N more that is invested. You'll also have less tied up with property taxes. It's a lot easier to live on $20k than $8k. Or do a reverse mortgage where the lender pays the property taxes. You'll get some more savings up front, have a place to live while you're alive, and save money annually. There are options with a house that you don't have without one.\"" }, { "docid": "271023", "title": "", "text": "The rent will be determined by: the rent being charged on similar houses near you. Your mortgage and other costs (very unfortunately!) have no bearing, at all, on the price you will get." }, { "docid": "547033", "title": "", "text": "\"The obvious advantage is turning your biggest liability into an income-generating asset. The downside are: (1), you have to find tenants (postings, time to show the place, credit/background check, and etc) (2), you have to deal with tenants (collection of rent, repairs of things that broke by itself, complaints from neighbors, termination, and etc) (3), you have to deal with the repairs In many ways, it's no different from running another (small) business, so it all boils down to how much time you are willing to invest and how handy you are in doing reno's and/or small repairs around the house. For profitability/ROI analysis, you want to assume collection of 11 months of rent per year (i.e. assume tenant doesn't renew after year, so you have the worst case scenario) and factor in all the associated expense (be honest). Renting out a second property is a bit tricky as you often have to deal with a large operating expense (i.e. mortgage), and renting a basement apartment is not bad financially and you will have to get used to have \"\"strangers\"\" downstairs.\"" }, { "docid": "339115", "title": "", "text": "\"It certainly seems like you are focusing on the emotional factors. That's your blind spot, and it's the surest path to a situation where your husband gets to say \"\"I told you so\"\". I recommend you steer straight into that blind spot, and focus your studies on the business aspects of buying and owning homes. You should be able to do spreadsheets 6 ways from Sunday, be able to recite every tax deduction you'll get as a homeowner, know the resale impacts of 1 bathroom vs 2, tell a dirty house from a broken house, etc. Everybody's got their favorites, mine are a bit dated but I like Robert Irwin and Robert Allen's books. For instance: a philosophy of Allen's that I really like: never sell. This avoids several problems, like the considerable costs of money, time and nerves of actually selling a house, stress about house prices, mistaking your house's equity for an ATM machine, and byzantine rules for capital gains tax mainly if you rent out the house, which vary dramatically by nation. In fact the whole area of taxes needs careful study. There's another side to the business of home ownership, and that's renting to others. There's a whole set of economics there - and that is a factor in what you buy. Now AirBNB adds a new wrinkle because there's some real money there. Come to understand that market well enough to gauge whether a duplex or triplex will be a money maker. Many regular folk like you have retired early and live off the rental income from their properties. JoeTaxpayer has an interesting way of looking at the finances of housing: if a house doesn't make sense as a a rental unit, maybe it doesn't make sense as a live-in either. So learn how to identify those fundamentals - the numbers. And get in the habit of evaluating houses. Work it regularly until it's second nature. Then, yes, you'll see houses you fall in love with, partly because the numbers work. It also helps to be handy. It really, really changes the economics if you can do your own quality work, because you don't need to spend any money on labor to convert a dirty house into a clean house. And lots of people do, and there's a whole SE just for that. There is a huge difference between going down to the local building supply and getting the water pipe you need, vs. having to call a plumber. And please deal with local businesses, please don't go to the Big Box stores, their service is abominable, they will cheerfully sell you a gadget salad of junk that doesn't work together, and I can't imagine a colder and less inviting scene to come up as a handy person.\"" }, { "docid": "316515", "title": "", "text": "\"Whatever you do, you need to be saving a lot more to have a good chance at retirement at a reasonable age. With a combined salary of $150,000, I'd recommend: In total, that's $47,000/year in tax advantaged accounts, plus whatever you put into taxable accounts. Your $150,000 yearly income, less $90,000/year in savings is still an income of $60,000. People live comfortably and raise families on a lot less. Consider how fortunate you are. You could retire in 10 years, if you wanted, by increasing your savings and decreasing your expenses. Seriously, I'm speaking from first-hand experience. If you stay on your present course (saving $2,000/mo), at a 7% real return, you'll need about 37 years to accumulate $3,800,000 (in today's dollars), which is enough to: Even if those student loans are forgiven, that only knocks off about 2 years. If you are in your late 30s now, there's a decent chance you'll be dead before you retire. As for buying a house or not, this depends a lot on your personal circumstance and how the rental market in your city compares. In your decision, don't forget to consider: Renting is not necessarily throwing money away any more than buying a house is. If you take out a mortgage, you'll be \"\"throwing away\"\" a lot of money anyway. Look for a \"\"loan amortization calculator\"\" to see how much goes to interest versus principal. For a $500,000 loan at a 3.5% rate, you will be paying approximately $1400 per month in interest versus only $800 towards the principal. When you deduct insurance, taxes, maintenance, etc from that $800, you may find you are still throwing away most of your monthly payment on interest and expenses you wouldn't have if you rented. The money you do \"\"save\"\", after interest and expenses, isn't really saved. Housing markets go up and down, but on average, over the long term, they go up just enough to keep up with inflation, meaning a 0% real return. If renting means less cash out of pocket per month, you can put that extra cash towards investments that yield a much higher return. Sure, you may need to continue making rental payments in perpetuity, but you can save enough extra money to pay for the rental in investment income. Again, it depends considerably on how the housing and rental markets compare where you live. Popular cities (San Francisco, New York, Paris, etc.) tend to favor renting. Unpopular cities (Detroit, St. Louis) and rural areas tend to favor buying. Further reading: Mr. Money Mustache: Rent vs. Buy: If You Have to Ask, You Should Probably Rent\"" }, { "docid": "215647", "title": "", "text": "There is no relationship between the government appraisal and the mortgage appraisal. The loan appraisal is done by a lender to determine if the property value is in agreement with the loan amount. The government appraisal is done to determine how much to charge you in taxes. They use the values of residences and commercial property to get their operating budget each year. They also set the rate to generate the amount of income money they need. If they cut all appraisals in half, they would just double the rate. In some jurisdictions the government appraises every year, in other places every three years. Some only when the property is sold. In some jurisdictions the maximum increase or decrease in government appraisal is set by law. But then they reset after the house is sold. That being said. Use this time to review the appraisal from the government. They may have facts wrong. They may think you have a pool, or more bedrooms or a garage, when you don't. Some jurisdictions use an automated process, others do a more detailed/individual process. If there was a mistake ten years ago with the description it will never get caught unless you complain. Check with the governemnt website for how to appeal. Some have windows of opportunity for an appeal." }, { "docid": "379023", "title": "", "text": "EDIT: new ideas based on the full story. I wouldn't worry about the price history. While it is certainly true that some buyers might try to leverage that information against you, the bottom line is the price is the price. Both the buyer and the seller have to agree. If the initial listing was too high, then lower the price. If that isn't low enough, then readjust down. I see no harm in moving the price down over time repeatedly. In fact, I thin that is a good tactic to getting the most for the house. If you happen to have the luxury of time, then keep lowering that price until it sells. Don't fret how that behavior appears. You can lower the price as often as you like until it sells. I am not a real estate agent, and I am a terrible negotiator, but I would lower the price every quarter until it sells. You can't go down to fast (a buyer might wait you out) and you can't wait to long as you stated. Also, if you house is priced inline with the neighborhood, you can at least get offers and negotiate. Buy asking for such a premium (25%) folks might not even make an offer. You simply need to decide what is more important, the selling price or the time frame in getting it sold. If you house doesn't sell because the market doesn't support your price, then consider keeping it as a rental. You can do it yourself, or if you are not interested in that (large) amount of work, then hire a rental management company to do it for a fee. Renting a home is hard work and requires attention to detail, a good amount of your time and much labor. If you just need to wait a couple of years before selling, renting it can be a good option to cover your costs while you wait for the market to reach you. You should get advice on how to handle the money, how to rent it, how to deal with renters, and the the laws are in your jurisdiction. Rent it out to a trusted friend or family member for a steal of a deal. They save money, and you get the luxury of time waiting for the sale. With a real estate lawyer you hire, get a contract for a lease option or owner finance deal on the house. Sometimes you can expand the market of people looking to buy your house. If you have a willing purchaser will bad credit, you can be doing them a favor and solving your own issue. It costs money and you will make less on the sale, but it could be better than nothing. Take heed, there is a reason some people cannot get a traditional loan on their own. Before you extend your good name or credit think about it. It is another hassle for sure. This won't help if you have to pay off a mortgage, but you could donate it. This is another tricky deal that you really need to speak with a lawyer who specialize in charitable giving. There are tax benefits, but I would make any kind of a deal where tax deductions are the only benefit. This is common enough these days. If you are unable to pay for the mortgage, it benefits you and the bank to get into a short sale arrangement. They bank gets probably more money than if they have to foreclose (and they save money on legal fees) and you can get rid of the obligation. You will do a deed in lieu or the short sale depending on how the market it and what the house can be sold for. You and the bank will have to work it out. This will ruin for a credit for a while, and you will not likely qualify to get a new mortgage for at least a few years. You can stop paying your mortgage, tell the bank and they will foreclose. This is going to ruin your credit for a long time as well as disqualify you from mortgages in the near future. Don't do this. If you are planning a foreclosure, take the time to contact your bank and arrange a short sale or a deed in lieu. There isn't really any excuse to go into foreclosure if you are having problems. Talk to the bank and work out a deal." }, { "docid": "546187", "title": "", "text": "\"If I have a house that its market value went from $100k to $140k can I get HELOC $40K? Maybe - the amount that you can borrow depends on the market value of the house, so if you already have $100k borrowed against it, it will be tough to borrow another $40k without paying a higher interest rate, since there is a real risk that the value will decrease and you will be underwater. Can I again ask for HELOC after I finish the renovation in order to do more renovation and maybe try to end up renovating the house so its value raises up to $500k? I doubt you can just \"\"renovate\"\" a house and increase its market value from $140k to $500K. Much of a house's value is determined by its location, and you can quickly outgrow a neighborhood. If you put $360k in improvements in a neighborhood where other homes are selling for $140k you will not realize nearly that amount in actual market value. People that buy $500k houses generally want to be in an area where other homes are worth around the same amount. If you want to to a major renovation (such as an addition) I would instead shop around for a Home Improvement Loan. The main difference is that you can use the expected value of the house after improvements to determine the loan balance, instead of using the current value. Once the renovations are complete, you roll it and the existing mortgage into a new mortgage, which will likely be cheaper than a mortgage + HELOC. The problem is that the cost of the improvements is generally more than the increase in market value. It also helps you make a wise decision, versus taking out a $40k HELOC and spending it all on renovations, only to find out that the increase in market value is only $10k and you're now underwater. So in your case, talk to a contractor to plan out what you want to do, which will tell you how much it will cost. Then talk to a realtor to determine what the market value with those improvements will be, which will tell you how much you can borrow. It's highly likely that you will need to pay some out-of-pocket to make up the difference, but it depends on what the improvements are and what comparable homes sell for.\"" }, { "docid": "284081", "title": "", "text": "Down payment: Emphatically avoid PMI if at all possible; it's pouring money down the drain. Do 20% down if you can, or pay off enough to bring you above 20% and ask for PMI to be removed as soon as you can. Beyond that it's a matter of how much risk you want to accept and how long you'll own the place, and you'll have to run the numbers for the various alternatives -- allowing for uncertainty in your investments -- to guide your decision. Do not assume you will be able to make a profit when you sell the house; that's the mistake which left many people under water and/or foreclosed on. Do not assume that you will be able to sell it quickly; it can take a year of more. Do not assume immediate or 100% occupancy it you rent it out; see many other answers here for more realistic numbers.... and remember that running a rental is a business and has ongoing costs and hassles. (You can contract those out, but then you lose a good percentage of the rent income.) Double mortgage is another great way to dig yourself into a financial hole; it can be a bigger cost than the PMI it tries to dodge and is definitely a bigger risk. Don't." }, { "docid": "329620", "title": "", "text": "The moment that you start to rent your car to strangers you are talking about using your car as a business. Will it be financially advantageous? If you can convince somebody to rent your vehicle for more than your required monthly payments then it might be. Of course you have to determine what would be the true cost of ownership for you. It could include your auto loan, and insurance, but you would be saving on the garage costs. Of course if you don't have it rented 100% of the time you will still have some costs. Your insurance company will need to know about your plan. They charge based on the risk. If you aren't honest about the situation they won't cover you if something goes wrong. The local government may want to know. They charge different car registration fees for businesses. If there are business taxes they will want that. Taxes. you are running a business so everybody from the federal governemnt to the local government may want a cut. Plus you will have to depreciate the value of the item. Turning the item from a personal use item to a business item can have tax issues. If you don't own it 100% the lender may also have concerns about making sure their collateral survives. Is it safe? and from the comments to the question : Should I do a contract or something that would protect me? Nope. it isn't safe unless you do have a contract. Of course that contract will have to be drawn up by a lawyer to make sure it protects you from theft, negligence, breach of contract.... You will have to be able to not just charge rent, but be able to repossess the car if they don't return it on time. You will have to be able to evaluate if the renter is trustworthy, or you may find your car is in far worse shape if you can even get it back." }, { "docid": "15951", "title": "", "text": "\"House prices do not go up. Land prices in countries with growing economies tend to go up. The price of the house on the land generally depreciates as it wears out. Houses require money; they are called money pits for a reason. You have to replace HVAC periodically, roofs, repairs, rot, foundation problems, leaks, electrical repair; and all of that just reduces the rate at which the house (not the land) loses value. To maintain value (of the house proper), you need to regularly rebuild parts of the house. People expect different things in Kitchens, bathrooms, dining rooms, doors, bedrooms today than they do in the past, and wear on flooring and fixtures accumulate over time. The price of land and is going to be highly determined by the current interest rates. Interest rates are currently near zero; if they go up by even a few percent, we can expect land prices to stop growing and start shrinking, even if the economy continues to grow. So the assumption that land+house prices go up is predicated on the last 35 years of constant rigorous economic growth mixed with interest rate decreases. This is a common illusion, that people assume the recent economic past is somehow the way things are \"\"naturally\"\". But we cannot decrease interest rates further, and rigorous economic growth is far from guaranteed. This is because people price land based on their carrying cost; the cost you have to spend out of your income to have ownership of it. And that is a function of interest rates. Throw in no longer expecting land values to constantly grow and second-order effects that boost land value also go away. Depending on the juristiction, a mortgage is a hugely leveraged investment. It is akin to taking 10,000$, borrowing 40,000$ and buying stock. If the stock goes up, you make almost 5x as much money; if it goes down, you lose 5x as much. And you owe a constant stream of money to service the debt on top of that. If you want to be risk free, work out how you'd deal with the value of your house dropping by 50% together with losing your job, getting a job paying half as much after a period of 6 months unemployment. The new job requires a 1.5 hour commute from your house. Interest rates going up to 12% and your mortgage is up for renewal (in 15 years - they climbed gradually over the time, say), optionally. That is a medium-bad situation (not a great depression scale problem), but is a realistic \"\"bad luck\"\" event that could happen to you. Not likely, but possible. Can you weather it? If so, the risk is within your bounds. Note that going bankrupt may be a reasonable plan to such a bit of bad luck. However, note that had you not purchased the house, you wouldn't be bankrupt in that situation. It is reasonably likely that house prices will, after you spend ~3% of the construction cost of the house per year, pay the mortgage on the land+house, grow at a rate sufficient to offset the cost of renting and generate an economically reasonable level of profit. It is not a risk-free investment. If someone tries to sell you a risk-free investment, they are almost certainly wrong.\"" }, { "docid": "573265", "title": "", "text": "The are a couple of explanations that I can think of; though for determining exactly what is different you will want to print out both returns and compare them line by line to see how they differ. If the company grossed up your income to account for the taxes on housing (possibly by paying the additional withholding), you may be just benefiting from them estimating your tax rate. This can especially be the case if your only work was the three month internship. They would have to assume your salary was for the entire year. There is an earned income tax credit for low wage earners that you may have qualified for (it would depend your specific circumstances if you meet the criteria). But that credit for a range of income actually pays out more the more you earn (to encourage working that extra hour instead of reducing benefit because you had another hour of employment). As for the housing subsidy itself, while the value is quite high the IRS considers that to be a taxable benefit that the employer provided you and so it needs to be added to your W-2 wages. $8k a month seems quite high, but I don't know the quality of the apartment you were provided and what the going rates are in the area. Given that you said you worked for a major tech company, I can imagine that you might have been working in an area with high rents. If the employer did gross up your paycheck so as to cover your taxes, that $24k would also include that extra tax payment (e.g. if the employer paid $8k in additional taxes for you, then the housing cost that they directly paid were $16k)." }, { "docid": "253552", "title": "", "text": "\"First of all, the numbers you give are most probably nowhere near the total expenses you have/need to budget: Maybe you should have a look at the expenses you had over the last years (look at how much money came in and how much went to the savings and compare this expenses to the sum of all the expenses you have on your list of expenses as plausibility check. Just starting on some numbers you give and assuming the house is the main goal. House of 300 - 500 k€, assuming downpayment of 30 - 40 %, i.e. somewhere between 90 and 200 k€. I'll go on calculating with 150 k€ which would be 50 % of 300 k€ or 30 % of 500 k€. You want to be there in 8 - 15 a: this means saving 10 - 19 k€ per year. 19 k€/a is clearly impossible with 20 k€ net wage. 10 k€ with 20 k€ net wage means a savings quote of 50 %, so for each € you spend, one goes towards the house. This is doable in the sense that if you continue with 4 k€/a for rent plus a Harz 4 (= 400 €/month) style of life, that would put you to 9 k€ expenses/a, thus 1 k€ saving for unexpected disaster (I'd actually first get a couple of k€ together for such things, and then go as much as possible towards the house). Still, this is not the life style the rest of your goals sounds like. (You can update this somewhat with the expected income of your girlfriend/wife. But remember that she needs food and clothes as well and you assume she'll need a car of her own) Let me rephrase the savings goal of 150 k€: you'd try to save 3 times the median German household equity within 8 to 15 years. This should tell you that it is a very steep proposition. On the other hand, e.g. Slowakians manage to have a median household equity of ca 60 k€ out of a median income that is roughly half the median income in Germany. So again it is somehow possible, but it will be really tough to live a life style like a Slowakian or Harz 4ler between peers that spend roughly everything (good approximation as we're talking about savings rates above 50 % of net income) they earn. I think the \"\"easiest\"\" way to get your savings going is to postpone lifestyle upgrades. On the other hand, around Waldeck, 150 k€ would buy you a complete new house of the same size that costs 300 - 500 k€ around Darmstadt. So if you really want to go for the house, I'd recommend not only to save as hard as you can*, but also to look out for possibilities to relocate to a cheaper area. 8 - 15 years should be enough time to decide what area you'd like and then to look for an opportunity without too much pressure. And actually this should be enough time so that also your girlfriend/wife could get herself transferred to another Bundesland. * In reality saving as hard as possible will probably get you nowhere near 150 k€ (there are very few people who manage to do this - though they exist), but if you get to 75 k€ that would mean a reasonably good position for both starting negotiations with the bank about buying a 150 k€ house plus the corresponding payment of the mortgage. If you get there within less than 15 years that would also leave some air in case you change opinion with regard to kids and then leaves a reasonable amount of time to put together your pension. Consider your psychology about saving towards the house. Even if both of you know that you want it really hard, it may be good to enter a building savings contract (15 years should be reasonable for that way) which will enforce you to keep up the savings rate and also does not allow you to divert money for other purposes. However, I'd say that 6 months into the first job it may be a bit early to fix such savings rates. Maybe for the beginning a savings account that includes some hassle to get the money out again (set low limit and allow any outgoing money to go only to another account of yours) with an automatic savings deposit every month is a way how to safely determine the savings rate you can manage. Maybe you can use this to first put together your new emergency savings which should be first priority anyways. If you want to cut expenses in order to save, look at the recommendations for people who try to get out of debt: budget your expenses, cook yourself and enjoy this (maybe taking a cooking class together with your girlfriend is a lot of fun, leads to food that may even be more to your taste than restaurant stuff - and is much cheaper), keep book, pay in cash (not by card) and so on. If you're not a DIY person, try whether you could enjoy becoming one - no magic involved there. I guess the most important point is to find out how much you want the house and then how hard you are willing to save. This is something only you and your girlfriend can decide (together!). IMHO you really don't need to invest (unless you drop the house plan), you need to save towards your goals. You may decide to invest a small part of the money while saving in order to learn slowly how that works, but if the house goal is already kind of fixed in time, you don't want to find yourself in the situation that you have to get out of investments at a bad time in order to be able to buy the house. Even if you consider 15 years long enough to do some investing now and then get out some time during the next 15 years, you don't have any money to invest now. Later, the risk posed by the fixed point in time when you need the money is too large: Considering the rather steep saving propositions, the marginal costs of having less money are really large. This means you don't want to go for risky investments => plain old saving is what you need. Consider also that low house prices tend to come during economic crisis (people cannot pay mortgage and have to sell) so within the time window, you want to have your money for anticyclic buying if possible.\"" }, { "docid": "137459", "title": "", "text": "Mixing friendship and money, whether that's loans or landlording, is risky. Often things work out, but sometimes the unexpected happens, and it doesn't. If things go wrong, are you prepared to walk away from either the friendship or the money? After you've considered that, the next question is how your roommates feel about the deal. You're looking to charge your friends $2000 to rent part of a property that, from the sound of it, they could rent much cheaper from a stranger. Maybe the market is different in Cleveland, but in my area, I'd expect to pay $2000 in rent for a place worth closer to $300,000 than $100,000. Have your roommates expressed interest in the idea, and have you discussed dollar values with them? Are you still interested if they ended up paying $1600 in rent? $1000?" }, { "docid": "219274", "title": "", "text": "Definitely get a lawyer to write up all the details of the partnership in a formal agreement. If your ex does not want to do this, that is a bad sign. You both need to be clear about expectations and responsibilities in this partnership, and define an exit strategy in the case one of you wants out. This is the most fair to both parties. Generally, what is common is that property is split cleanly when the relationship ends. I would strongly recommend you both work towards a clean split with no joint property ownership. How this looks depends on your unique situation. To address your questions 2 and 3: You have two roles here - tenant and owner. As a 50% owner, you are running a business with a partner. That business will have assets (home), income, expenses, and profit. You basically need to run this partnership as a simple business. All the rent income (your rent and the other tenant's) should go into a separate account. The mortgage and all other housing expenses are then paid from only this account. Any excess is then profit that may be split 50/50. All expenses should be agreed upon by both of you, either by contract or by direct communication. You should see a financial professional to make sure accounting and taxes are set up properly. Under this system, your ex could do work on the house and be paid from the business income. However, they are responsible to you to provide an estimate and scope of work, just like any other contractor. If you as a joint owner agree to his price, he then could be paid out of the business income. This reduces the business cash flow for the year accordingly. You can probably see how this can get very complicated very fast. There is really no right or wrong answer on what both of you decide is fair and best. For the sake of simplicity and the least chance of a disaster, the usual and recommended action is to cleanly split all property. Good Luck!" }, { "docid": "397749", "title": "", "text": "There could be a number of reasons for a rent increase. The only information I can offer is how I calculate what rent I will charge. The minimum I would ever charge per unit (Mortgage payment + Water) / Number of units This number is the minimum because it's what I need to keep afloat. Keep in mind these are ballpark numbers The target rent ((Mortgage payment + Water) / Number of units)*1.60 I mark up the price 60% for a few reasons. First, the building needs a repair budget. That money has to come from somewhere. Second, I want to put away for my next acquisition and third I want to make a profit. These get me close to my rental price but ultimately it depends on your location and the comparables in the area. If my target rent is 600 a month but the neighbors are getting 700-800 for the same exact unit I might ask more. It also depends on the types of units. Some of my buildings, all of the units are identical. Other buildings half of the units are bigger than the other half so clearly I wouldn't charge a equal amount for them. Ultimately you have to remember we're not in the game to lose money. I know what my renters are going to pay before I even put an offer in on a building because that's how I stay in business. It might go up over the years but it will always outpace my expenses for that property." } ]

[ { "docid": "482165", "title": "", "text": "It depends on the structure of your business. Are you a sole proprietor filing Schedule C on your 1040, or an S-corp, or part of a partnership? The treatment of a home office will differ depending on business entity." } ]

[ { "docid": "125057", "title": "", "text": "&gt; But their strategy is not debt spending to increase demand. They deficit spend. They increase prosperity and thus demand. They do it consistently and repeatedly. Claims that it's effects are unintentional don't hold up. Starve the beast is political cover. What they are doing is pushing profits up for the rich by cutting their taxes. Why has as many answers as there are politicians pursuing these policies, but the deficit spending is fairly obviously designed to make the economy appear to be doing better. The interesting side effect is, that they *are* making the economy do better. &gt; Deficit spending does drive demand short term. But as this debt rises so does the rent seeking cost of that debt. This is not where rent seeking occurs. The net cost of national debt is negative. &gt; Most such debt spending is a complete waste. Only if you don't understand that people having money is a prerequisite for people spending money. &gt; Your tax rate is not determined by how much money the government takes from you. The government gives you more income than it takes from you in taxes. Every bit of cut spending removes income from the population. Since we all work for each other and one person's income becomes another's relatively quickly, it's an appropriate approximation to average that income out over the population and when you do that you quickly see that government taxes and spending have a net positive effect on how much money we have. This is why we can dump so much into defense spending and still have a viable economy and why removing that spending would do more harm than good. Our economic trouble has nothing to do with efficiency and how much work needs to be done, and everything to do with how much money people have to spend. Government taking on more debt thus creating more money and handing it to it's population makes that problem better and thus the economy gains strength. Fixing the core problem that is causing the population to run out of money is a harder task, but piling on the debt in the meantime alleviates the symptoms." }, { "docid": "546187", "title": "", "text": "\"If I have a house that its market value went from $100k to $140k can I get HELOC $40K? Maybe - the amount that you can borrow depends on the market value of the house, so if you already have $100k borrowed against it, it will be tough to borrow another $40k without paying a higher interest rate, since there is a real risk that the value will decrease and you will be underwater. Can I again ask for HELOC after I finish the renovation in order to do more renovation and maybe try to end up renovating the house so its value raises up to $500k? I doubt you can just \"\"renovate\"\" a house and increase its market value from $140k to $500K. Much of a house's value is determined by its location, and you can quickly outgrow a neighborhood. If you put $360k in improvements in a neighborhood where other homes are selling for $140k you will not realize nearly that amount in actual market value. People that buy $500k houses generally want to be in an area where other homes are worth around the same amount. If you want to to a major renovation (such as an addition) I would instead shop around for a Home Improvement Loan. The main difference is that you can use the expected value of the house after improvements to determine the loan balance, instead of using the current value. Once the renovations are complete, you roll it and the existing mortgage into a new mortgage, which will likely be cheaper than a mortgage + HELOC. The problem is that the cost of the improvements is generally more than the increase in market value. It also helps you make a wise decision, versus taking out a $40k HELOC and spending it all on renovations, only to find out that the increase in market value is only $10k and you're now underwater. So in your case, talk to a contractor to plan out what you want to do, which will tell you how much it will cost. Then talk to a realtor to determine what the market value with those improvements will be, which will tell you how much you can borrow. It's highly likely that you will need to pay some out-of-pocket to make up the difference, but it depends on what the improvements are and what comparable homes sell for.\"" }, { "docid": "285449", "title": "", "text": "You should have a partnership agreement of some sort. The reason partnership agreements exist is so nobody can change the game because of the outcome. I'd say the most typical partnership agreement is that everyone gets an equal cut, meaning that everyone also makes an equal contribution. If you have start up expenses of $10,000, you'd each contribute $5,000. Separately, you can determine ownership share by contribution amounts, maybe one of you contributed $2,000 and the other $8,000; this would be an 80/20 split. The performance of the operation doesn't have anything to do with determining how to divide the pie, your partnership agreement determines that. How much have you each contributed and what agreement did you make before you decided to be partners? If you have a poor performing business segment, then the partnership should get together and consider adjusting or stopping that line of business. But you don't change how the pie is divided because of it; unless your partnership agreement says you do." }, { "docid": "65461", "title": "", "text": "First, let me fill in the gaps on your situation, based on the numbers you've given so far. I estimate that your student loan balance (principal) is $21,600. With the variable rate loan option that you've presented, the maximum interest rate you could be charged would be 11.5%, which would bring your monthly payment up to that $382 number you gave in the comments. Your thoughts are correct about the advantage to paying this loan off sooner. If you are planning on paying off this loan sooner, the interest rate on the variable rate loan has less opportunity to climb. One thing to be cautious of with the comparison, though: The $1200 difference between the two options is only valid if your rate does not increase. If the rate does increase, of course, the difference would be less, or it could even go the other way. So keep in mind that the $1200 savings is only a theoretical maximum; you won't actually see that much savings with the variable rate option. Before making a decision, you need to find out more about the terms of this variable rate loan: How often can your rate go up? What is the loan rate based on? I'm not as familiar with student loan variable rate loans, but there are other variable rate loans I am familiar with: With a typical adjustable rate home mortgage, the rate is locked for a certain number of years (perhaps 5 years). After that, the bank might be allowed to raise the rate once every period of months (perhaps once every year). There will be a limit to how much the rate can rise on each increase (perhaps 1.0%), and there will be a maximum rate that could be charged over the life of the loan (perhaps 12%). The interest rate on your mortgage can adjust up, inside of those parameters. (The actual formula used to adjust will be found in the fine print of your mortgage contract.) However, the bank knows that if they let your rate get too high above the current market rates, you will refinance to a different bank. So the mortgage is typically structured so that it will raise your rate somewhat, but it won't usually get too far above the market rate. If you knew ahead of time that you would have the house paid off in 5 years, or that you would be selling the house before the 5 years is over, you could confidently take the adjustable rate mortgage. Credit cards, on the other hand, also typically have variable rates. These rates can change every month, but they are usually calculated on some formula determined ahead of time. For example, on my credit card, the interest rate is the published Prime Rate plus 13.65%. On my last statement, it said the rate was 17.15%. (Of course, because I pay my balance in full each month, I don't pay any interest. The rate could go up to 50%, for all I care.) As I said, I don't know what determines the rate on your variable rate student loan option, and I don't know what the limits are. If it climbs up to 11.5%, that is obviously ridiculously high. I recommend that you try to pay off this student loan as soon as you possibly can; however, if you are not planning on paying off this student loan early, you need to try to determine how likely the rate is to climb if you want to pick the variable rate option." }, { "docid": "216384", "title": "", "text": "\"Having convinced myself that there is no point of paying someone's else mortgage Somewhat rhetorical this many years later, but I expect some other kid forcefed the obsession with propping up the housing market might be repeating the nonsense about \"\"paying someone else's mortgage\"\" and read this. Will you be buying your own farm to grow your own food, or are you happy with people using the money you spend on food for a mortgage? How about clothes? Will you be weaving your own clothes because you don't want money you spend on clothes to pay someone else's mortgage? What's special about the money you pay for rent that you get annoyed at how someone else spends it? Don't get a mortgage just because you don't like the idea of how other people might spend the money that's no longer yours after you pay them with it. As an aside, at your age with your income and no debt, you could be sensibly investing a lot of money. If you did that for five years, you'd be in a much better position that you would be tying yourself to whatever current scheme the UK is using to desperately prop up house prices.\"" }, { "docid": "105345", "title": "", "text": "An amortization schedule is often used to produce identical payments for the term (repayment period) of a loan, resulting in the principal being paid off and the debt retired at the end of the loan. This is in contrast to an interest only, or balloon loan. These loans require little or no payment against the balance of the loan, requiring the loan to be paid indefinitely if there is no term, or requiring the loan to be entirely paid off from cash or a new loan at the end of the term. A basic amortization formula can be derived from the compound interest formula: This formula comes from the Wikipedia article on amortization. The basics of the formula are the periodic payment amount, A (your monthly payment), can be determined by the principal loan, P, the rate, r, and the number of payments, n. Lenders lend money to make a profit on the interest. They'd like to get back all the money they lent out. Amortization schedules are popular because the fixed low payments make it easier for borrowers to pay the loan off eventually. They also tend to be very profitable for lenders, especially at the start of the term, because they make a lot of profit on interest, just like the start of your mortgage. The principal of a mortgage has more meaning than the principal of a revolving debt credit card. The mortgage principal is fixed at the start, and represents the value of the collateral property that is your home. You could consider the amount of principal paid to be the percentage of your home that you actually own (as part of your net worth calculation). A credit card has a new balance each month depending on how much you charge and how much you pay off. Principal has less meaning in this case, because there is no collateral to compare against, and the balance will change monthly. In this case, the meaning of the amortization schedule on your credit card is how long it will take you to pay off the balance if you stop charging and pay at the proscribed payment level over the term described. Given the high interest rate on credit cards, you may end up paying twice as much for goods in the long run if you follow your lenders schedule. Amortizing loans are common for consumer loans, unless a borrower is seeking out the lowest possible monthly payment. Lenders recognize that people will eventually die, and want to be paid off before that happens. Balloon and interest only bonds and loans are more commonly issued by businesses and governments who are (hopefully) investing in capital improvements that will pay off in the long run. Thousands of people and businesses have gone bankrupt in this financial crisis because their interest only loans reached term, and no one was willing to lend them money anymore to replace their existing loan." }, { "docid": "277457", "title": "", "text": "\"You're not focusing in the right place and neither is anyone else on this thread because this isn't about the guy owning you money... This is about you not having enough money to pay your rent. If rent wasn't due and the utility bills weren't piling up, you wouldn't be trying to justify taking money out of someone else's account. So let's triage this. Your #1 problem isn't hunting down Dr. Deadbeat's wallet. So put a pin in that for now and get to the real deal. Getting rent paid. Right? OK, you said he called \"\"regarding a business I have\"\". It's great that you have your own business. Are you also employed elsewhere? If you are, then you really should simply go to your employer and tell them you are in financial distress. Tell them that right now you can't cover your rent or bills and you want to know if they can help, i.e. give you an advance from your paycheck, do a withdrawal/loan from a retirement savings that's in your employee benefits package, etc... They will HELP YOU because it's in their best interest as much as it is in yours. Foregoing that, consider these thoughts... If you were to go your grandparents telling them what you told all of us here, and ask them the same \"\"do you think it's ok to...\"\", they would say something close to \"\"Absolutely DO NOT touch someone else bank account EVER! It doesn't matter what information you have, how you got it, or what you think they owe you. Do NOT touch it. There's a legal system that will help you get it from them if they truly do owe it to you.\"\" I guarantee you this, withdrawing funds from an account on which you are NOT an authorized signatory is both financial theft as well as identity theft. Bonus if you do it on a computer, because you'd then be facing criminal charges that go beyond your specific legal district, i.e. you'd face criminal charges on a national level. If convicted, odds are you'd be sentenced within the penal guidelines of the Netherlands 1983 Financial Penalties Act (FPA). Ergo, you would have much much much less money in the very near future, which would feel like an eternal walk through the Hell of the court system. Ultimately, over your lifetime you would be exponentially poorer than you may think you are now. I strongly urge you to rebrand this \"\"financial loss\"\" as \"\"Tuition at the School of Hard Knocks\"\". There's one last thing... the train jumps the tracks for me during your story... This guy called you? Right?... (raised eyebrow) What kind of business do you \"\"have\"\"? The sense of desperation and naiveté in your urgent need for money to pay rent. The fact that you are accepting payment for services by conducting a bank transfer specifically from your clients account directly toward your own utility bills is a big red flag. Bypassing business accounting and using revenue for personal finances isn't legitimate business practices. Plus you are doing it by using the bank information of brand new client who is a TOTAL stranger. Now consider fact that this total stranger was so exceedingly generous to someone from whom he wanted personal services to be rendered. Those all tell me that he's doing something he wants the other person to do for him and he doesn't want anyone else to know. The fact that he's being so benevolent like a 'sugar daddy' tells me that he feels guilty for having someone do what he's asking them to do. Perceived financial superiority is the smoothest of smooth power tools that predators and abusers have in their bag. For instance, an outlandish financial promise is probably the easiest way to target someone who is vulnerable; and then seduce them into being their victim. Redirecting your focus on how much better life will be once your problem is solved by this cash rather than focusing on the fact that they're taking advantage of you. Offering to pay rates that are dramatically excessive is a way of buying a clean conscious, because he's doing something that will \"\"rescue you\"\" from a crisis. The final nail in the coffin for me was that he left so abruptly and your implied instinct suggesting his reason was a lie. It sounds like he got scared or ashamed of his actions and ran out. It paints a picture that this was sex-for-money Good luck to you.\"" }, { "docid": "28504", "title": "", "text": "First you should understand the basics of how insurance companies make money: In a simple scenario, assume 1,000 have car insurance. Assume that on average, 100 people have accidents per year, and that each accident costs $10,000. So, we can expect total costs to be $1,000,000 per year. Some of those costs will be paid by the drivers, who have some sort of 'deductible'. That is - the insurance company will only cover costs after the driver has themself paid some initial amount [something like, the first $1,000 of repairs is paid by the driver]. So now the insurance company expects to have to pay out $900,000 in total claims this year. If they want to pay those claims (and also pay their administrative costs, and earn a profit), they might want to have $1,250,000 in revenue. Across 1,000 people, that would be $1,250 / year in insurance premiums. Of course, the big question for the insurance company is: how much will they really need to pay out in insurance claims each year? The better they can predict that number, the more profitable they can be [because they can charge a much more accurate amount, which can earn them new customers and gives them insurance {pun} that each new customer is actually profitable to them on average]. So the insurance company spends a lot of time and money trying to predict your likelihood of a car accident. They use a lot of metrics to do this. Some might be statistical hogwash that they charge you because they feel they can [if every insurance company charges you extra for driving a 2-door instead of a 4-door, then they all will], and some might be based in reality. So they attempt to correlate all of the items in your list, to see if any of those items indicates that you should be charged more (or less) for your insurance. This is equal parts art and science, and a lot of it comes down to how they market themselves. ie: if an insurance company gives a discount for being in college, is that because college drivers are better drivers, or is it because they want to increase the number of young customers they have, so they can keep those customers for life? Therefore how each metric factors into your calculation will be based on the company using it. It would basically be impossible to 'come up with' the same answer as the insurance company by having the information you provided, because of how heavily dependant that answer is on statistics + marketing. As for how your state matters - some states may have different accident rates, and different payout systems. For example - is Hawaii driving more dangerous because of all the tourists driving rented cars faster than they should? Is New York less expensive to insure because better public health care means less cost is borne by the insurance company in the event of an accident [I have no idea if either of these things are the case, they are purely for hypothetical discussion purposes]. In short, make sure you get quotes from multiple providers, and understand that it isn't just the cost that changes. Check changes in coverage and deductibles as well [ie: if one company charges you $100 / month when everyone else charges $200 / month - make sure that the cheaper company doesn't limit its coverage in ways that matter to you]." }, { "docid": "344955", "title": "", "text": "There are other answers here about how much you can deduct for a home office. What seems unique is the question of whether you can deduct it for both your LLC and for your employment. Unless your LLC owns the home, you cannot deduct the depreciation directly. Instead you have to charge your LLC rent for the time that you are using the space for the LLC. That rent must be declared as income on your personal tax return, and you can then offset some of it with the time you spend in that space working for your employer and depreciation for time it is being rented to your LLC. Using a strategy this complex may save you a few bucks on your return, but this is definitely an area where a tax professional is worth the expense making sure you get it right." }, { "docid": "385829", "title": "", "text": "Many good answers here, especially that you have to consider that renting may be more expensive than you'd think. Also, keep in mind that rent is money that is completely lost. Even if the property has dropped in value, if you keep paying, you will be able to recuperate part of your mortgage payments when you sell the house. Normally this is about +-30%, but you need to calculate this yourself by dividing the expected sales price of the house by the total mortgage payments you have to make to pack back everything. So I'd say walking away only makes sense if the rents around where you want to live are much lower than (<+-30%) your mortgage payment, and stable. In stead of walking away immediately, perhaps you can refinance your mortgage with a new one? In 2008 the rates were around 5.8%, now they are around 3.6% or so. I don't know how it goes in the USA but in my country, if the rates drop, it is relatively to do this and it can save people who refinance thousands if not more." }, { "docid": "324066", "title": "", "text": "\"You could end up with nothing, yes. I imagine those that worked at Enron years ago if their 401(k) was all in company stock would have ended up with nothing to give an example here. However, more likely is for you to end up with less than you thought as you see other choices as being better that with the benefit of hindsight you wish you had made different choices. The strategies will vary as some people will want something similar to a \"\"set it and forget it\"\" kind of investment and there may be fund choices where a fund has a targeted retirement date some years out into the future. These can be useful for people that don't want to do a lot of research and spend time deciding amongst various choices. Other people may prefer something a bit more active. In this case, you have to determine how much work do you want to do, do you want to review fund reviews on places like Morningstar, and do periodic reviews of your investments, etc. What works best for you is for you to resolve for yourself. As for risks, here are a few possible categories: Time - How many hours a week do you want to spend on this? How much time learning this do you want to do in the beginning? While this does apply to everyone, you have to figure out for yourself how much of a cost do you want to take here. Volatility - Some investments may fluctuate in value and this can cause issues for some people as it may change more than they would like. For example, if you invest rather aggressively, there may be times where you could have a -50% return in a year and that isn't really acceptable to some people. Inflation - Similarly to those investments that vary wildly there is also the risk that with time, prices generally rise and thus there is something to be said for the purchasing power of your investment. If you want to consider this in more detail consider what $1,000,000 would have bought 30 years ago compared to now. Currency risk - Some investments may be in other currencies and thus there is a risk of how different denominations may impact a return. Fees - How much do your fund's charge in the form of annual expense ratio? Are you aware of the charges being taken to manage your money here?\"" }, { "docid": "215647", "title": "", "text": "There is no relationship between the government appraisal and the mortgage appraisal. The loan appraisal is done by a lender to determine if the property value is in agreement with the loan amount. The government appraisal is done to determine how much to charge you in taxes. They use the values of residences and commercial property to get their operating budget each year. They also set the rate to generate the amount of income money they need. If they cut all appraisals in half, they would just double the rate. In some jurisdictions the government appraises every year, in other places every three years. Some only when the property is sold. In some jurisdictions the maximum increase or decrease in government appraisal is set by law. But then they reset after the house is sold. That being said. Use this time to review the appraisal from the government. They may have facts wrong. They may think you have a pool, or more bedrooms or a garage, when you don't. Some jurisdictions use an automated process, others do a more detailed/individual process. If there was a mistake ten years ago with the description it will never get caught unless you complain. Check with the governemnt website for how to appeal. Some have windows of opportunity for an appeal." }, { "docid": "573265", "title": "", "text": "The are a couple of explanations that I can think of; though for determining exactly what is different you will want to print out both returns and compare them line by line to see how they differ. If the company grossed up your income to account for the taxes on housing (possibly by paying the additional withholding), you may be just benefiting from them estimating your tax rate. This can especially be the case if your only work was the three month internship. They would have to assume your salary was for the entire year. There is an earned income tax credit for low wage earners that you may have qualified for (it would depend your specific circumstances if you meet the criteria). But that credit for a range of income actually pays out more the more you earn (to encourage working that extra hour instead of reducing benefit because you had another hour of employment). As for the housing subsidy itself, while the value is quite high the IRS considers that to be a taxable benefit that the employer provided you and so it needs to be added to your W-2 wages. $8k a month seems quite high, but I don't know the quality of the apartment you were provided and what the going rates are in the area. Given that you said you worked for a major tech company, I can imagine that you might have been working in an area with high rents. If the employer did gross up your paycheck so as to cover your taxes, that $24k would also include that extra tax payment (e.g. if the employer paid $8k in additional taxes for you, then the housing cost that they directly paid were $16k)." }, { "docid": "565409", "title": "", "text": "As a landlord for 14 years with 10 properties, I can give a few pointers: be able and skilled enough to perform the majority of maintenance because this is your biggest expense otherwise. it will shock you how much maintenance rental units require. don't invest in real estate where the locality/state favors the tenant (e.g., New York City) in disputes. A great state is Florida where you can have someone evicted very quickly. require a minimum credit score of 620 for all tenants over 21. This seems to be the magic number that keeps most of the nightmare tenants out makes sure they have a job nearby that pays at least three times their annual rent every renewal, adjust your tenant's rent to be approximately 5% less than going rates in your area. Use Zillow as a guide. Keeping just below market rates keeps tenants from moving to cheaper options. do not rent to anyone under 30 and single. Trust me trust me trust me. you can't legally do this officially, but do it while offering another acceptable reason for rejection; there's always something you could say that's legitimate (bad credit, or chose another tenant, etc.) charge a 5% late fee starting 10 days after the rent is due. 20 days late, file for eviction to let the tenant know you mean business. Don't sink yourself too much in debt, put enough money down so that you start profitable. I made the mistake of burying myself and I haven't barely been able to breathe for the entire 14 years. It's just now finally coming into profitability. Don't get adjustable rate or balloon loans under any circumstances. Fixed 30 only. You can pay it down in 20 years and get the same benefits as if you got a fixed 20, but you will want the option of paying less some months so get the 30 and treat it like a 20. don't even try to find your own tenants. Use a realtor and take the 10% cost hit. They actually save you money because they can show your place to a lot more prospective tenants and it will be rented much sooner. Empty place = empty wallet. Also, block out the part of the realtor's agreement-to-lease where it states they keep getting the 10% every year thereafter. Most realtors will go along with this just to get the first year, but if they don't, find another realtor. buy all in the same community if you can, then you can use the same vendor list, the same lease agreement, the same realtor, the same documentation, spreadsheets, etc. Much much easier to have everything a clone. They say don't put all your eggs in one basket, but the reality is, running a bunch of properties is a lot of work, and the more similar they are, the more you can duplicate your work for free. That's worth a lot more day-to-day than the remote chance your entire community goes up in flames" }, { "docid": "307276", "title": "", "text": "No It's not a loan. It's an equity investment. Think of it as a business. The parents bought 75% of the equity with $115K, and are entitled to 75% of the sale proceeds, should you someday liquidate the business (i.e. selling the house). The $500 per month is just business revenue and is paid to your parents as a dividend. Imagine you rent it out to your self and charge a $666.66 rent - you take 25% of that back and give your parents the rest. Like any equity investment, the risk for them is that if the value of the house goes down, they will have to shoulder the loss. And you are right, there is no way to build equity. You already sold that to your parents." }, { "docid": "510219", "title": "", "text": "I recognize you are probably somewhere in the middle of various steps here... but I'd start and go through one-by-one in a disciplined way. That helps to cut through the overwhelming torrent of information that's out there. Here is my start at a general checklist: others can feel free to edit it or add their input. How 'much' house would you like to buy in terms of $$$ and bedrooms/sq ft. You can start pretty general here, but the idea is to figure out if you can actually afford a brand new 4bd/3ba 2,500 sq ft house (upwards of $500K in your neck of the woods according to trulia.com). Or maybe with your current resources you'll be looking at something like a townhome that is more entry-level but still yours. Some might recommend that this is a good time to talk to any significant others/whomevers and understand/manage expectations. My wife usually cares a lot about schools at this stage, but I think it's too early. Just ballpark whether you're looking at a $500K house, a $300K house, or a $200K townhome. How much house can you afford in terms of monthly payments only... (not considering other costs like utilities yet). Looking around at calculators like this one from bankrate.com can help you figure this out. Set the interest rate @ 5%, 30-year loan, and change the 'mortgage amount' until you have something that is about 80%-90% of what you currently pay in rent each month. I'll get to 'why' to undershoot your rent payment later. Crap... can't afford my dream house... If you don't have the down payment to make the numbers work (remember that this doesn't even include closing costs yet), there are other loan options like FHA loans that can go as low as about 5% down payment. The math would be the same but you replace 0.8 with 0.95. Then, look at your personal budget. Come up with general estimates of what you currently bring in and spend each month overall. Just ballpark it... Next, figure what you currently spend towards housing in particular. Whether you are paying for it or your landlord is paying for it, someone pays for a lot of different things for housing. For now, my list would include (1) Rent, (2) Mortgage Payment, (3) Electricity, (4) Gas, (5) Sewer, (6) Water, (7) Trash, (8) Other utilities... TV/Internet/Phone, (9) Property Insurance, (10) Renter's Insurance, and (11) Property Taxes. I would put it into a table in Excel somewhere that has 3 columns... The first has the labels, the second will have what you spend now, and the third will have what you might spend on each one as a homeowner. If you pay it now, put it in the second column. If your landlord pays it right now, leave it out as that's included in your rent payment. Obviously each cell won't be filled in. Fill in the rest of the third column. You won't pay rent anymore, but you will have a mortgage payment. You probably have a good estimate of any electricity bills, etc that you currently pay, but those may be slightly higher in a house vs. a condo or an apartment. As for things like sewer, water, trash or other 'community' utilities, my bet would be that your landlord pays for those. If you need a good estimate ask around with some co-workers or friends that own their own places. They would also be a good resource for property insurance estimates... shooting from the hip I would say about $100/month based on this website. (I'm not affiliated). The real 'ouch' is going to be property tax rates. Based on the data from this website, your county is about 9% of property value. So add that into the third column as well. Can you really afford a house? round 2 Now... add up the third column and see how that monthly expense amount on housing compares against your current monthly budget. If it's over, you don't have to give up, but you should just understand how much your decision to purchase a house will strain your budget. Also, you should use this information to look again at 'how much house can you afford.' Now, do some more research. If you need to get a revised loan amount based on the FHA loan decision, then use the bankrate calculator to find out what the monthly payment is for a 95% loan against your target price. But remember that an FHA loan will also carry PMI that is extra on top of your monthly payment. Or, if you need to revise your mortgage payment downwards (or upwards) change the loan amount accordingly. Once you've got the numbers set, look for properties that fit. This way you can have a meaningful discussion with yourself or other stakeholders about what you can afford. As far as arranging financing... a realtor will be able and willing to point you in the right direction for obtaining funding, etc. And at that point you can just check anything you're offered by shopping interest rates, etc against what the internet has to say. Feel free to ask us, too... it's hard to give much better direction without more specifics." }, { "docid": "339115", "title": "", "text": "\"It certainly seems like you are focusing on the emotional factors. That's your blind spot, and it's the surest path to a situation where your husband gets to say \"\"I told you so\"\". I recommend you steer straight into that blind spot, and focus your studies on the business aspects of buying and owning homes. You should be able to do spreadsheets 6 ways from Sunday, be able to recite every tax deduction you'll get as a homeowner, know the resale impacts of 1 bathroom vs 2, tell a dirty house from a broken house, etc. Everybody's got their favorites, mine are a bit dated but I like Robert Irwin and Robert Allen's books. For instance: a philosophy of Allen's that I really like: never sell. This avoids several problems, like the considerable costs of money, time and nerves of actually selling a house, stress about house prices, mistaking your house's equity for an ATM machine, and byzantine rules for capital gains tax mainly if you rent out the house, which vary dramatically by nation. In fact the whole area of taxes needs careful study. There's another side to the business of home ownership, and that's renting to others. There's a whole set of economics there - and that is a factor in what you buy. Now AirBNB adds a new wrinkle because there's some real money there. Come to understand that market well enough to gauge whether a duplex or triplex will be a money maker. Many regular folk like you have retired early and live off the rental income from their properties. JoeTaxpayer has an interesting way of looking at the finances of housing: if a house doesn't make sense as a a rental unit, maybe it doesn't make sense as a live-in either. So learn how to identify those fundamentals - the numbers. And get in the habit of evaluating houses. Work it regularly until it's second nature. Then, yes, you'll see houses you fall in love with, partly because the numbers work. It also helps to be handy. It really, really changes the economics if you can do your own quality work, because you don't need to spend any money on labor to convert a dirty house into a clean house. And lots of people do, and there's a whole SE just for that. There is a huge difference between going down to the local building supply and getting the water pipe you need, vs. having to call a plumber. And please deal with local businesses, please don't go to the Big Box stores, their service is abominable, they will cheerfully sell you a gadget salad of junk that doesn't work together, and I can't imagine a colder and less inviting scene to come up as a handy person.\"" }, { "docid": "271591", "title": "", "text": "When I purchased my house I struggled with this same idea. I felt sick to my stomach signing a contract stating how much money I now owe a bank. However, the lawyer I was using put it in terms that eased the nausea a little (I still hate owing that much money - but it's a little more palatable). His words, paraphrased: At the end of the day, you have to have a place to stay. Your mortgage payment is replacing your rent except in this case, you're paying yourself instead of someone else. You lose a little flexibility in being able to up and move with relative ease. However, you've lived in apartments, you know that rent almost only goes up. Your mortgage will not. He wrote out some numbers and basically showed that everything evened out except mortgage payments will give you property as opposed to paying for someone else's property. To answer your question though - others have already stated - you'll get a better return in the stock market (usually). But unless you're really really bad at real estate evaluation - you should make some money off your house when you decide to sell." }, { "docid": "378384", "title": "", "text": "\"Not sure what you are talking about. The house isn't part of a business so neither of you can deduct half of normal maintenance and repairs. It is just the cost of having a house. The only time this would be untrue is if the thing that you are buying for the house is part of a special deduction or rebate for that tax year. For instance the US has been running rebates and deductions on certain household items that reduce energy - namely insulation, windows, doors, and heating/cooling systems (much more but those are the normal things). And in actuality if your brother is using the entire house as a living quarters you should be charging him some sort of rent. The rent could be up to the current monthly market price of the home minus 50%. If it were my family I would probably charge them what I would pay for a 3% loan on the house minus 50%. Going back to the repairs... Really if these repairs are upgrades and not things caused by using the house and \"\"breaking\"\" or \"\"wearing\"\" things you should be paying half of this, as anything that contributes to the increased property value should be paid for equally if you both are expecting to take home 50% a piece once you sell it.\"" } ]

[ { "docid": "397152", "title": "", "text": "To be confident in your solution, and get the best solution for you, consult a local accountant, preferably one who is specialized in taxes for businesses. Or muddle through the code and figure it out for yourself. The primary advantage in consulting with an accountant is that you can ask them to point out ways you can restructure your expenses, debts and income in order to minimize your tax burden. They can help you run the numbers for the various options and choose the one that is right, numerically." } ]

[ { "docid": "496395", "title": "", "text": "It seems that you are misunderstanding how your taxes are calculated. You seem to be under the impression that once you pass $37,450 annual income, ALL of your income will be taxed at 25%. However, in reality, only the income you earn above that amount will be taxed at 25%. You can use this chart to determine exactly how much federal tax you will pay; As you can see, if you earned, $37,500 in a year, you would only be charged 25% taxes on $50 (and you will pay 15% on the amount between $9226 and $37450, and 10% on the amount from $0 to $9225, which is $5126.25 when summed together)." }, { "docid": "451849", "title": "", "text": "\"The general answer is: \"\"it depends on how long you want to live there\"\". Here is a good calculator to figure it out: http://www.nytimes.com/interactive/business/buy-rent-calculator.html Basically, if you plan to move in a few years, then renting makes more sense. It is a lot easier to move from an apartment when your lease is up versus selling a house, which can be subject to fluctuations in the real-estate market. As an example, during the real estate bubble, a lot of \"\"young professional\"\" types bought condos and town homes instead of renting. Now these people are married with kids, need to move somewhere bigger, but they can't get rid of their old place because they can't sell it for what they still owe. If these people had rented for a few years, they would be in a better position financially. (Many people fell for the mantra \"\"If you are renting, you are throwing your money away\"\", without looking at the long-term implications.) However, your question is a little unique, because you mentioned renting for the rest of your life, and putting the savings into an investment, which is a cool idea. (Thinking outside the box, I like it.) I'm going to assume you mean \"\"rent the same place for many years\"\" versus \"\"moving around the country every few years\"\". If you are staying in one place for a long time, I am going to say that buying a house is probably a better option. Here's why: So what about investing? Let's look at some numbers: So, based on the above, I say that buying a house is the way to go (as long as you plan to live in the same place for several years). However, if you could find a better investment than the Dow, or if mortgage interest rates change drastically, things could tip in another direction. Addendum: CrimsonX brought up a good point about the costs of owning a house (upkeep and property taxes), which I didn't mention above. However, I don't think they change my answer. If you rent, you are still paying those costs. They are just hidden from you. Your landlord pays the contractor or the tax man, and then you pay the landlord as part of your rent.\"" }, { "docid": "481401", "title": "", "text": "Personal finance is a fairly broad area. Which part might you be starting with? From the very basics, make sure you understand your current cashflow: are you bank balances going up or down? Next, make a budget. There's plenty of information to get started here, and it doesn't require a fancy piece of software. This will make sure you have a deeper understanding of where your money is going, and what is it being saved for. Is it just piling up, or is it allocated for specific purchases (i.e. that new car, house, college tuition, retirement, or even a vacation or a rainy day)? As part of the budgeting/cashflow exercise, make sure you have any outstanding debts covered. Are your credit card balances under control? Do you have other outstanding loans (education, auto, mortgage, other)? Normally, you'd address these in order from highest to lowest interest rate. Your budget should address any immediate mandatory expenses (rent, utilities, food) and long term existing debts. Then comes discretionary spending and savings (especially until you have a decent emergency fund). How much can you afford to spend on discretionary purchases? How much do you want to be able to spend? If the want is greater than the can, what steps can you take to rememdy that? With savings you can have a whole new set of planning to consider. How much do you leave in the bank? Do you keep some amount in a CD ladder? How much goes into retirement savings accounts (401k, Roth vs. Traditional IRA), college savings accounts, or a plain brokerage account? How do you balance your overall portfolio (there is a wealth of information on portfolio management)? What level of risk are you comfortable with? What level of risk should you consider, given your age and goals? How involved do you want to be with your portfolio, or do you want someone else to manage it? Silver Dragon's answer contains some good starting points for portfolio management and investing. Definitely spend some time learning the basics of investing and portfolio management even if you decide to solicit professional expertise; understanding what they're doing can help to determine earlier whether your interests are being treated as a priority." }, { "docid": "283657", "title": "", "text": "\"I have the same problem. The people above are right to an extent. You have to be more disciplined. But there is no reason why you can't get there in stages. If you try to do too much too fast you'll just give up. You need to find a system that removes some of the passive barriers affecting you. You need to think what in particular is overwhelming you. For me it was sitting down at the end of the month to write it all down. Writing it all down at the end of the week or even each day didn't work either because it was too much and I had forgotten what stuff was. I'm like you. The bank account is a record so why do I have to retype it or worse, hand write it out? Bleh. What I ended up doing was divide my expenses into four categories: food (to include all medical) shelter, transportation, spending -- with the first three being needs and the last being wants. Eating out is spending. I have four checking accounts with four debit cards. I saved up some money. I put a paycheck's worth of money in each because I didn't know how much I spent each month in each category, but knew I didn't spend an entire paycheck in any one category per month. Voila. No more work. At the store you just put things in the basket by category. At Target you pay for the food and toothpaste with the medical card and the DVD with the spending card. The cashiers don't care that you pay separately. And if you are buying so much crap that separating items by category is a problem, why the heck are you buying so much crap? At the end of the month you will now have a record of how much you spend on transportation, housing (electricity would be paid online from this account for example), medical and fun. That's all anyone needs to help you get started. You can then see if your housing is 35% or less (or whatever percentage you feel is right). The person trying to help the author above is right. A Target charge doesn't indicate whether you bought some oil for the car or cold medicine or a lock for the cabinet door that broke. But when you pay for each of these things under the right account, you do know how the money is allocated. Doing it this way requires little discipline. Before you put the item in the basket, you just ask yourself, is this a want or a need (which is something you should be doing anyway). If it's a need, is it for my car, house, or body. The house is what I use if i can't figure it out (like paying for the renewal of my professional license). that's it! You have to stand at the register for longer but so what. If you are spending all your salary and you stop when you have no more money (assuming you've run through all of your savings, which you will soon if you don't change), then you have no more money to spend. So if you are honest when you put things in the basket(need vs want), you are going to run out of spending money real quick. Your spending money account will be empty but you will still have food money. Set your debit card up so that it denies your charge if you dont have enough money. Once you realize how much you truly spend for needs in each category, yoy will only put that much in each account. Therefore, You can't use the house card to just \"\"borrow\"\" from it till next month. If you do, you won't be able to pay your bills. If you have so little discipline that you knowingly spend your bill money, then there is a deeper issue going on than just finding the right budgeting/cash flow system for you. Something is seriously wrong and you need to seek professional help. When someone is trying to help you, the first step is to determine what category you are spending too much in. Then when you realize it's the house category, for example, you will need to figure out why you are spending so much in that category. A bank statement wont tell you that. So you can do what we did. On every receipt --before you walk out of the store-- write down what each purchase is on the receipt. Then you can hand over the receipts to whoever is helping you. Most items are easily recognizable on the receipt so you wont have to write everything down. you should be doing this for insurance purposes anyway. Again, if your receipt is so blooming long that this is onerous, probably everything you just spent is not a need and maybe you need to turn right around and return stuff. Maybe you need to go to the store more often so there are only a few purchases on each receipt. Groceries are groceries. You don't need to detail that out. For Ikea when you have to purchase pieces to a set, we get a separate receipts for each. So the brackets and shelving for the bedroom will be on one receipt and the brackets and shelving for the other room will be on another receipt. Even at the store I cant figure out what all the little pieces are! But really, if you are making a decent enough salary, then you are probably spending too much on wants and are calling the items needs. So really your problem is correctly identifying needs from wants. Define a NEED. YOU. Make up your own definition of need Dwell on it. Let it become meaningful for you. Oranges are a need. Chocolate is not (no, really it's not! Lol!). So when you are putting the stuff in the basket, you dont even have to think about whether it's a need or not after a while. Wants go in the child seat if at all possible (to keep the number of items smaller). When you are ready to check out, add up the items roughly in the want pile. Ask yourself if you really want all that stuff. Then put some stuff back! At this point ask yourself is the 8 hours I will have to work to pay for this worth it? Am I really going to use it? Will using the item make me happy? Or is it the actual buying of the item that makes me feel powerful? Where will I put it? How much time will I need to maintain it? Then put some stuff back! Get some good goals, a kayaking trip or whatever. Ask yourself if the item is worth delaying the trip. How will I feel later? Will I have buyers remorse? If so, put it back! These are controls you can put into place that don't take a lot of discipline. Writing the items down on the receipt is a more advanced step you can take later. If you are with friends, go first so that you can write down the items while they are checking out. If you are private and don't want to share your method with your friends, go to the bathroom and in the stall write it down while they wait. Writing the items on the receipt while in the store is sort of a trigger mechanism for remembering to do so. That pulling out of the card triggers your memory to get out your pen or ask the cashier for one. The side benefit is catching someone using a cloned copy of your card. In the medical account if you see an Exxon charge, you know it's not yours. Also, while that one account is shut down, you have three others to rely on in the meantime. My spouse hated fumbling for the right card. They all look the same. Color code your cards. We have blue cross blue shield so it feels natural to have the food/medical account with a blue sticker (just buy a little circle sticker and place it on the edge so half is on the front and half is on the back -- nowhere near the strip). I've never been given a hard time about it. Our car is red so the car card is red, etc. If you think four cards is a lot to carry, ask yourself if you would rather carry four cards or keep track of every little thing? Good luck. I know you will find a system that works for you if you keep trying.\"" }, { "docid": "344955", "title": "", "text": "There are other answers here about how much you can deduct for a home office. What seems unique is the question of whether you can deduct it for both your LLC and for your employment. Unless your LLC owns the home, you cannot deduct the depreciation directly. Instead you have to charge your LLC rent for the time that you are using the space for the LLC. That rent must be declared as income on your personal tax return, and you can then offset some of it with the time you spend in that space working for your employer and depreciation for time it is being rented to your LLC. Using a strategy this complex may save you a few bucks on your return, but this is definitely an area where a tax professional is worth the expense making sure you get it right." }, { "docid": "137459", "title": "", "text": "Mixing friendship and money, whether that's loans or landlording, is risky. Often things work out, but sometimes the unexpected happens, and it doesn't. If things go wrong, are you prepared to walk away from either the friendship or the money? After you've considered that, the next question is how your roommates feel about the deal. You're looking to charge your friends $2000 to rent part of a property that, from the sound of it, they could rent much cheaper from a stranger. Maybe the market is different in Cleveland, but in my area, I'd expect to pay $2000 in rent for a place worth closer to $300,000 than $100,000. Have your roommates expressed interest in the idea, and have you discussed dollar values with them? Are you still interested if they ended up paying $1600 in rent? $1000?" }, { "docid": "510219", "title": "", "text": "I recognize you are probably somewhere in the middle of various steps here... but I'd start and go through one-by-one in a disciplined way. That helps to cut through the overwhelming torrent of information that's out there. Here is my start at a general checklist: others can feel free to edit it or add their input. How 'much' house would you like to buy in terms of $$$ and bedrooms/sq ft. You can start pretty general here, but the idea is to figure out if you can actually afford a brand new 4bd/3ba 2,500 sq ft house (upwards of $500K in your neck of the woods according to trulia.com). Or maybe with your current resources you'll be looking at something like a townhome that is more entry-level but still yours. Some might recommend that this is a good time to talk to any significant others/whomevers and understand/manage expectations. My wife usually cares a lot about schools at this stage, but I think it's too early. Just ballpark whether you're looking at a $500K house, a $300K house, or a $200K townhome. How much house can you afford in terms of monthly payments only... (not considering other costs like utilities yet). Looking around at calculators like this one from bankrate.com can help you figure this out. Set the interest rate @ 5%, 30-year loan, and change the 'mortgage amount' until you have something that is about 80%-90% of what you currently pay in rent each month. I'll get to 'why' to undershoot your rent payment later. Crap... can't afford my dream house... If you don't have the down payment to make the numbers work (remember that this doesn't even include closing costs yet), there are other loan options like FHA loans that can go as low as about 5% down payment. The math would be the same but you replace 0.8 with 0.95. Then, look at your personal budget. Come up with general estimates of what you currently bring in and spend each month overall. Just ballpark it... Next, figure what you currently spend towards housing in particular. Whether you are paying for it or your landlord is paying for it, someone pays for a lot of different things for housing. For now, my list would include (1) Rent, (2) Mortgage Payment, (3) Electricity, (4) Gas, (5) Sewer, (6) Water, (7) Trash, (8) Other utilities... TV/Internet/Phone, (9) Property Insurance, (10) Renter's Insurance, and (11) Property Taxes. I would put it into a table in Excel somewhere that has 3 columns... The first has the labels, the second will have what you spend now, and the third will have what you might spend on each one as a homeowner. If you pay it now, put it in the second column. If your landlord pays it right now, leave it out as that's included in your rent payment. Obviously each cell won't be filled in. Fill in the rest of the third column. You won't pay rent anymore, but you will have a mortgage payment. You probably have a good estimate of any electricity bills, etc that you currently pay, but those may be slightly higher in a house vs. a condo or an apartment. As for things like sewer, water, trash or other 'community' utilities, my bet would be that your landlord pays for those. If you need a good estimate ask around with some co-workers or friends that own their own places. They would also be a good resource for property insurance estimates... shooting from the hip I would say about $100/month based on this website. (I'm not affiliated). The real 'ouch' is going to be property tax rates. Based on the data from this website, your county is about 9% of property value. So add that into the third column as well. Can you really afford a house? round 2 Now... add up the third column and see how that monthly expense amount on housing compares against your current monthly budget. If it's over, you don't have to give up, but you should just understand how much your decision to purchase a house will strain your budget. Also, you should use this information to look again at 'how much house can you afford.' Now, do some more research. If you need to get a revised loan amount based on the FHA loan decision, then use the bankrate calculator to find out what the monthly payment is for a 95% loan against your target price. But remember that an FHA loan will also carry PMI that is extra on top of your monthly payment. Or, if you need to revise your mortgage payment downwards (or upwards) change the loan amount accordingly. Once you've got the numbers set, look for properties that fit. This way you can have a meaningful discussion with yourself or other stakeholders about what you can afford. As far as arranging financing... a realtor will be able and willing to point you in the right direction for obtaining funding, etc. And at that point you can just check anything you're offered by shopping interest rates, etc against what the internet has to say. Feel free to ask us, too... it's hard to give much better direction without more specifics." }, { "docid": "453656", "title": "", "text": "you are discounting the cash used, the discount rate for cash should be whatever you determine is your risk premium over the risk free rate not the equity growth rate. if equity growth rate is above your determined required return the equity investment is wealth destroying and if it is above that then it is wealth increasing. The difficulty I see is that the scenario is all wrong, what you are really after is a rent vs buy decision. Do I take this money and rent a place or do I buy a house? In either case you could invest the remainder after paying your rent/mortgage in the equity market no? So what really matters is the difference in cost between renting and buying. Let (EGR)=equity growth rate Rent = rent M = Mortgage payment I = income HA = home value appreciation Now the question is is renting or buying a better decision two scenarios, renting first PMT =(I - rent) I/y = (EGR) N =Time horizon in years FV= Gain from cf left after paying rent then discount to present day at your required rate of return to find present value now scenario for buying, this is more complicated because you are investing two different cf streams at different rates and have to calculate both and add them together. 1) CF 1 the mortgage payments buy you equity in the house which appreciates (hopefully) but can be extremely volatile. This is the cf stream scenario one doesnt have, when renting the rent payments poof disappear forever and you earn nothing on them 2) The income left after mortgage payment which can be invested at the market rate measured the same way as above. **This is extremely simplistic and doesnt take into account expected maintenance, property taxes and other costs intrinsic to the investment. It also doesnt take into account the lost down payment setting you well behind the renter. TL DR: It is complicated but you determine the required return(discount rate) based on the perceived risk of the investment and your particular views and it doesnt matter what expected growth rates are since any investment with an expected growth rate below your required rate is wealth destroying since you are paying for something which returns cash flows too small for its risk level. If you use growth rates as discount rates then all your investments will net to zero" }, { "docid": "28504", "title": "", "text": "First you should understand the basics of how insurance companies make money: In a simple scenario, assume 1,000 have car insurance. Assume that on average, 100 people have accidents per year, and that each accident costs $10,000. So, we can expect total costs to be $1,000,000 per year. Some of those costs will be paid by the drivers, who have some sort of 'deductible'. That is - the insurance company will only cover costs after the driver has themself paid some initial amount [something like, the first $1,000 of repairs is paid by the driver]. So now the insurance company expects to have to pay out $900,000 in total claims this year. If they want to pay those claims (and also pay their administrative costs, and earn a profit), they might want to have $1,250,000 in revenue. Across 1,000 people, that would be $1,250 / year in insurance premiums. Of course, the big question for the insurance company is: how much will they really need to pay out in insurance claims each year? The better they can predict that number, the more profitable they can be [because they can charge a much more accurate amount, which can earn them new customers and gives them insurance {pun} that each new customer is actually profitable to them on average]. So the insurance company spends a lot of time and money trying to predict your likelihood of a car accident. They use a lot of metrics to do this. Some might be statistical hogwash that they charge you because they feel they can [if every insurance company charges you extra for driving a 2-door instead of a 4-door, then they all will], and some might be based in reality. So they attempt to correlate all of the items in your list, to see if any of those items indicates that you should be charged more (or less) for your insurance. This is equal parts art and science, and a lot of it comes down to how they market themselves. ie: if an insurance company gives a discount for being in college, is that because college drivers are better drivers, or is it because they want to increase the number of young customers they have, so they can keep those customers for life? Therefore how each metric factors into your calculation will be based on the company using it. It would basically be impossible to 'come up with' the same answer as the insurance company by having the information you provided, because of how heavily dependant that answer is on statistics + marketing. As for how your state matters - some states may have different accident rates, and different payout systems. For example - is Hawaii driving more dangerous because of all the tourists driving rented cars faster than they should? Is New York less expensive to insure because better public health care means less cost is borne by the insurance company in the event of an accident [I have no idea if either of these things are the case, they are purely for hypothetical discussion purposes]. In short, make sure you get quotes from multiple providers, and understand that it isn't just the cost that changes. Check changes in coverage and deductibles as well [ie: if one company charges you $100 / month when everyone else charges $200 / month - make sure that the cheaper company doesn't limit its coverage in ways that matter to you]." }, { "docid": "565409", "title": "", "text": "As a landlord for 14 years with 10 properties, I can give a few pointers: be able and skilled enough to perform the majority of maintenance because this is your biggest expense otherwise. it will shock you how much maintenance rental units require. don't invest in real estate where the locality/state favors the tenant (e.g., New York City) in disputes. A great state is Florida where you can have someone evicted very quickly. require a minimum credit score of 620 for all tenants over 21. This seems to be the magic number that keeps most of the nightmare tenants out makes sure they have a job nearby that pays at least three times their annual rent every renewal, adjust your tenant's rent to be approximately 5% less than going rates in your area. Use Zillow as a guide. Keeping just below market rates keeps tenants from moving to cheaper options. do not rent to anyone under 30 and single. Trust me trust me trust me. you can't legally do this officially, but do it while offering another acceptable reason for rejection; there's always something you could say that's legitimate (bad credit, or chose another tenant, etc.) charge a 5% late fee starting 10 days after the rent is due. 20 days late, file for eviction to let the tenant know you mean business. Don't sink yourself too much in debt, put enough money down so that you start profitable. I made the mistake of burying myself and I haven't barely been able to breathe for the entire 14 years. It's just now finally coming into profitability. Don't get adjustable rate or balloon loans under any circumstances. Fixed 30 only. You can pay it down in 20 years and get the same benefits as if you got a fixed 20, but you will want the option of paying less some months so get the 30 and treat it like a 20. don't even try to find your own tenants. Use a realtor and take the 10% cost hit. They actually save you money because they can show your place to a lot more prospective tenants and it will be rented much sooner. Empty place = empty wallet. Also, block out the part of the realtor's agreement-to-lease where it states they keep getting the 10% every year thereafter. Most realtors will go along with this just to get the first year, but if they don't, find another realtor. buy all in the same community if you can, then you can use the same vendor list, the same lease agreement, the same realtor, the same documentation, spreadsheets, etc. Much much easier to have everything a clone. They say don't put all your eggs in one basket, but the reality is, running a bunch of properties is a lot of work, and the more similar they are, the more you can duplicate your work for free. That's worth a lot more day-to-day than the remote chance your entire community goes up in flames" }, { "docid": "65461", "title": "", "text": "First, let me fill in the gaps on your situation, based on the numbers you've given so far. I estimate that your student loan balance (principal) is $21,600. With the variable rate loan option that you've presented, the maximum interest rate you could be charged would be 11.5%, which would bring your monthly payment up to that $382 number you gave in the comments. Your thoughts are correct about the advantage to paying this loan off sooner. If you are planning on paying off this loan sooner, the interest rate on the variable rate loan has less opportunity to climb. One thing to be cautious of with the comparison, though: The $1200 difference between the two options is only valid if your rate does not increase. If the rate does increase, of course, the difference would be less, or it could even go the other way. So keep in mind that the $1200 savings is only a theoretical maximum; you won't actually see that much savings with the variable rate option. Before making a decision, you need to find out more about the terms of this variable rate loan: How often can your rate go up? What is the loan rate based on? I'm not as familiar with student loan variable rate loans, but there are other variable rate loans I am familiar with: With a typical adjustable rate home mortgage, the rate is locked for a certain number of years (perhaps 5 years). After that, the bank might be allowed to raise the rate once every period of months (perhaps once every year). There will be a limit to how much the rate can rise on each increase (perhaps 1.0%), and there will be a maximum rate that could be charged over the life of the loan (perhaps 12%). The interest rate on your mortgage can adjust up, inside of those parameters. (The actual formula used to adjust will be found in the fine print of your mortgage contract.) However, the bank knows that if they let your rate get too high above the current market rates, you will refinance to a different bank. So the mortgage is typically structured so that it will raise your rate somewhat, but it won't usually get too far above the market rate. If you knew ahead of time that you would have the house paid off in 5 years, or that you would be selling the house before the 5 years is over, you could confidently take the adjustable rate mortgage. Credit cards, on the other hand, also typically have variable rates. These rates can change every month, but they are usually calculated on some formula determined ahead of time. For example, on my credit card, the interest rate is the published Prime Rate plus 13.65%. On my last statement, it said the rate was 17.15%. (Of course, because I pay my balance in full each month, I don't pay any interest. The rate could go up to 50%, for all I care.) As I said, I don't know what determines the rate on your variable rate student loan option, and I don't know what the limits are. If it climbs up to 11.5%, that is obviously ridiculously high. I recommend that you try to pay off this student loan as soon as you possibly can; however, if you are not planning on paying off this student loan early, you need to try to determine how likely the rate is to climb if you want to pick the variable rate option." }, { "docid": "549601", "title": "", "text": "I know of no generic formula for determining if an investment property is a good investment, besides the trivial formula. Make sure your income is greater than your expenses, and hope the value of the property doesn't drop. Some people will tell you to expect the monthly rent to be a fixed percentage of the purchase price, but that is a goal not a certainty. It is also impossible to estimate the difficulty renting the property, or how long the roof will last. Taxes can't be predicted, as the value of the house increase, so do the property taxes, but you might not be able to increase the rent. You can't even predict the quality of the tenant. Will they damage the property? Or skip out early? You will need somebody who knows the local market to estimate the local conditions, and help you determine the estimated costs and income based on the actual property involved." }, { "docid": "408112", "title": "", "text": "\"Thinking about the business overall, your \"\"profit\"\" would be: Since this is a sole proprietorship, the taxes are going to depend on your marginal tax rate. If you file jointly, your income will determine what your marginal tax rate is. If you file separately, there likely wouldn't be any tax on that income since it's less than the standard deduction, but you lose benefits of filing jointly (combined exemptions, etc.) So think about how much she would charge, what expenses are involved (before taxes), what the taxes would be on that profit, and what the \"\"opportunity costs\"\" are - is it worth time away from the kids/hobbies/etc. for that hobby? How much should a hobby business make to make it worth the effort of charging for such services? That would fall in the \"\"expense\"\" section. Are you talking about the actual costs (tax prep, etc.) or just the hassle of collecting, accounting, etc. Certainly those are a consideration but it's harder to quantify that. If you can come up with some sort of cost then certainly it would fit in the overall value equation. I'm not sure using additional Social Security benefits as a gauge is helpful, since you wouldn't see those benefits until you're of retirement age (according to SS) and a lot can happen between now and then.\"" }, { "docid": "213975", "title": "", "text": "&gt;means less demand for absurdly priced homes which means prices will drop to affordable levels. Rent and home prices are obviously variable but in my area home prices are pretty aligned with rents. Assuming both home prices and rent goes up with inflation and accounting for insurance, taxes, tax advantages, maintenance and a list of other issues the prices are comparable. If you have the capital for a down payment and plan to stay in one house (or aparment) for 5 years you are probably better off buying. To say home prices are absurd you need to be comparing it to what you consider it's true worth but how are you determining that? Edit: Perhaps both rent and home prices will go down as more people live with their parents and room mates but I haven't seen that trend start yet and vacancy rates aren't that high (as far as I know) so I don't see it starting soon. If that trend did start I imagine new construction would be the first ones to go but housing developments are going strong around me." }, { "docid": "547033", "title": "", "text": "\"The obvious advantage is turning your biggest liability into an income-generating asset. The downside are: (1), you have to find tenants (postings, time to show the place, credit/background check, and etc) (2), you have to deal with tenants (collection of rent, repairs of things that broke by itself, complaints from neighbors, termination, and etc) (3), you have to deal with the repairs In many ways, it's no different from running another (small) business, so it all boils down to how much time you are willing to invest and how handy you are in doing reno's and/or small repairs around the house. For profitability/ROI analysis, you want to assume collection of 11 months of rent per year (i.e. assume tenant doesn't renew after year, so you have the worst case scenario) and factor in all the associated expense (be honest). Renting out a second property is a bit tricky as you often have to deal with a large operating expense (i.e. mortgage), and renting a basement apartment is not bad financially and you will have to get used to have \"\"strangers\"\" downstairs.\"" }, { "docid": "314163", "title": "", "text": "Advantages of buying: With every mortgage payment you build equity, while with rent, once you sign the check the money is gone. Eventually you will own the house and can live there for free. You can redecorate or remodel to your own liking, rather than being stuck with what the landlord decides is attractive, cost-effective, etc. Here in the U.S. there are tax breaks for homeowners. I'm not sure if that's true in U.K. Advantages of renting: If you decide to move, you may be stuck paying out a lease, but the financial penalty is small. With a house, you may find it difficult to sell. You may be stuck accepting a big loss or having to pay a mortgage on the empty house while you are also paying for your new place. When there are maintenance issues, you call the landlord and it's up to him to fix it. You don't have to come up with the money to pay for repairs. You usually have less maintenance work to do: with a house you have to mow the lawn, clear snow from the driveway, etc. With a rental, usually the landlord does that for you. (Not always, depends on type of rental, but.) You can often buy a house for less than it would cost to rent an equivalent property, but this can be misleading. When you buy, you have to pay property taxes and pay for maintenance; when you rent, these things are included in the rent. How expensive a house you can afford to buy is not a question that can be answered objectively. Banks have formulas that limit how much they will loan you, but in my experience that's always been a rather high upper bound, much more than I would actually be comfortable borrowing. The biggest issue really is, How important is it to you to have a nice house? If your life-long dream is to have a big, luxurious, expensive house, then maybe it's worth it to you to pour every spare penny you have into the mortgage. Other people might prefer to spend less on their house so that they have spare cash for a nice car, concert tickets, video games, cocaine, whatever. Bear in mind that if you get a mortgage that you can just barely afford, what do you do if something goes wrong and you can't afford it any more? What if you lose your job and have to take a lower-paying job? What if some disaster strikes and you have some other huge expense? Etc. On the flip side, the burden of a mortgage usually goes down over time. Most people find that their incomes go up over time, between inflation and growing experience. But the amount of a mortgage is fixed, or if it varies it varies with interest rates, probably bouncing up and down rather than going steadily up like inflation. So it's likely -- not at all certain, but likely -- that if you can just barely afford the payment now, that in 5 or 10 years it won't be as big a burden." }, { "docid": "107780", "title": "", "text": "Investing is good. Insurance when you have something to insure is good. But using a single account for investing and insurance is not so good. You need to determine how much you need to invest for retirement. You also need to determine if you need life insurance. As a single person you might determine that you don't have a great need for life insurance. If you get married, or have kids, your needs may grow. So you will want to revisit your decisions every so often. You may need to save for retirement, or setup a college fund. You may need to protect your spouse or children in case you die. It doesn't seem to make sense to invest and insure in a plan with complicated rules, fees and schedules. What happens if in 3 years you need to blow it up and start over? What surrender charges will they hit you with?" }, { "docid": "284081", "title": "", "text": "Down payment: Emphatically avoid PMI if at all possible; it's pouring money down the drain. Do 20% down if you can, or pay off enough to bring you above 20% and ask for PMI to be removed as soon as you can. Beyond that it's a matter of how much risk you want to accept and how long you'll own the place, and you'll have to run the numbers for the various alternatives -- allowing for uncertainty in your investments -- to guide your decision. Do not assume you will be able to make a profit when you sell the house; that's the mistake which left many people under water and/or foreclosed on. Do not assume that you will be able to sell it quickly; it can take a year of more. Do not assume immediate or 100% occupancy it you rent it out; see many other answers here for more realistic numbers.... and remember that running a rental is a business and has ongoing costs and hassles. (You can contract those out, but then you lose a good percentage of the rent income.) Double mortgage is another great way to dig yourself into a financial hole; it can be a bigger cost than the PMI it tries to dodge and is definitely a bigger risk. Don't." }, { "docid": "67731", "title": "", "text": "\"Property taxes, where they exist, are generally levied by cities, counties and other local-level administrative bodies like MUDs, and are the primary source of revenue at these levels of government. These taxes pay the lion's share of the expenses for basic services provided by a city or county: There are federal dollars, other revenue sources (State lottery revenues often go toward public schools for instance), and \"\"usage fees\"\" (vehicle registration, utility bills, toll roads) at play as well, but a lot of that money covers larger-scale infrastructure development (freeways/interstates) and specialized \"\"earmarks\"\" (political backscratching involving this bridge or that dam in a Congresscritter's home district, a few national initiatives from the President's budget like first-responder technology upgrades for improved disaster/terrorism readiness). Property taxes are the main funding for the day-to-day government operations at the most visible level to the average resident. The theory behind using a property tax instead of some other form of taxation (like income) is that the value of the property and the quality of services provided to the resident(s) of that property are interrelated; the property is valuable in part because the infrastructure is well-maintained and nearby schools/hospitals are good, and by the same token, affluent residents expect high-quality services. Property taxes are also easier to levy, because most of the work can be done by the tax assessor; monitor recent sale prices, do drive-bys through neighborhoods, come up with a number and send the resident the bill. That's opposed to sales taxes which businesses operating in the jurisdiction have to calculate, collect and turn over, or income taxes which require residents to fill out paperwork to calculate how much they owe. The justification is eminent domain. It's very simple; when you buy land in the U.S. and a State thereof, you are still a citizen and/or resident of that State and the U.S., and subject to their laws. You're not creating your own country when you buy a house. As such, the government charges you for the facilities and services they provide in your area and your State, which are then your privilege to use. Obviously roads aren't free; a one-mile stretch behind my house is costing the county $15 million to expand it from 2-lane to 4-lane. Here's the kicker; you've already been paying these taxes. You think your landlord's just going to take the property taxes for the whole apartment complex on the chin? He's out to make money, and doing that requires charging a sufficient amount to cover costs, including taxes he incurs. You just never see \"\"allocated property taxes\"\" as an item on your rent statement, just like you don't see \"\"allocated landowner mortgage\"\", \"\"allocated facilities maintenance\"\", \"\"allocated gross margin\"\" etc. You know you're getting shafted, paying someone else's financing with a little extra on the side to boot. That's why you want a house. Unfortunately, not being able to pay these taxes is a grim reality for some people, old and young, and government generally doesn't go easy on delinquent homeowners. After medical bills and mortgage delinquency, property tax delinquency is the number three reason for bankruptcy, and only a mortgage or property tax delinquency can cause your home to be seized and sold. Well that and using it for criminal enterprise, but unless you're running a meth lab in your half-million-dollar home or financing it with coke money I wouldn't worry about that score. Retirement planners figure property taxes into cost of living, and they do often advise a downgrade from the 2-story house you raised your children in to something smaller (for many reasons, including lower taxes). There really isn't a way to structure a completely \"\"pay-as-you-go\"\" metropolitan area, and you wouldn't want to live in it if there were. Imagine every strip of asphalt in the county being a toll road where your transponder (TollTag, EZ-Pass, etc) or license plate was scanned and you were billed at each intersection. In addition to being a huge invasion of privacy, the cost to maintain this network (and your cost to use it) would skyrocket. Imagine 911 asking for a credit card number before dispatching police, fire or EMS (Ambulance services already do bill on a per-event basis, but you'd be surprised how few people pay and how little power a county EMS has to enforce collection; without a property tax and Medicaid to cover the difference, EMS service could not be provided in most counties).\"" } ]

[ { "docid": "46092", "title": "", "text": "I see no reason why a US ID would be mandatory anywhere in the UK. I'm sure they have their own tax IDs in the UK. However, if the gallery requires US persons to submit US W-9 - then yes, you're covered under that requirement." } ]

[ { "docid": "512939", "title": "", "text": "You should check this with a tax accountant or tax preparation expert, but I encountered a similar situation in Canada. Your ISA income does count as income in a foreign country, and it is not tax exempt (the tax exemption is only because the British government specifically says so). You would need to declare the income to the foreign government who would almost certainly charge you tax on it. There are a couple of reasons why you should probably keep the funds in the ISA, especially if you are looking to return. First contribution limits are per year, so if you took the money out now you would have to use future contribution room to put it back. Second almost all UK savings accounts deduct tax at source, and its frankly a pain to get it back. Leaving the money in an ISA saves you that hassle, or the equal hassle of transferring it to an offshore account." }, { "docid": "523431", "title": "", "text": "\"If you're a US citizen, money earned while in the US is sourced to the US. So you can't apply FTC/FEIE to the amounts attributable to the periods of your work while in the US even if it is a short business trip. Tax treaties may affect this. Most tax treaties have explicit provisions to exclude short trips from the sourcing rules, however due to the \"\"saving clause\"\" these would probably not apply to you if you're a US citizen - you'll need to read the relevant treaty. Your home country should allow credit for the US taxes paid on the US-sourced income, and the double-taxation avoidance provision should apply in this case. The technicalities depend on your specific country. You would probably not just remove it from the taxable income, there probably is a form similar to the US form 1116 to calculate the available credit.\"" }, { "docid": "376828", "title": "", "text": "&gt; Less capital tax = less pressure on the wealthy/entrepreneurs (since you keep bigger portion of your net income, the interest to bring back business should increase) = capital inflow back to the US. IMO, this statement makes a whole lot of assumptions that are untrue. 1) The wealthy create jobs. I believe the opposite is true. I think if you want more companies/jobs you should offer universal healthcare so low to middle class folks can risk leaving an established company to start on their own. 2) More money to the rich means more investment in the economy. My experience shows the rich will use the money to grow their own wealth, not everyone's. I remember a recent Bloomberg article where businessmen said they would use repatriated money for buyouts, liminting competition and growing a company's hold on the market. 3) Take home money is used for investment. It isn't. Companies do the large investments, not individuals. Consider Amazon looking at growing their distribution channels or Apple with their iPhone evolution. If you make it more profitable for corporate profits to go to compensation, you leave less money for investment. 4) Companies struggle in the US due to overtaxation. This is a flat out myth. Cost of taxes for business in the US is one of the lowest for rich, educated countries and that is before the tax kickbacks (a la Foxconn) or loopholes. 5) And the bigges IMO -- the US has been fed the lie that the best thing for the citizens of the country is aligned with the best things for the country's companies. The opposite is the case." }, { "docid": "388983", "title": "", "text": "All the major American and British banks, with a couple of exceptions. The British government, despite its conservative ideology, is imposing stronger regulatory limits and even discussing 'say on pay' provisions for executive compensation. The US remains wedded to its allegedly free market leanings despite revelations that JP Morgan, among others, receives $14 BILLION a year in government subsidies. And the markets have made it clear that they dont just welcome, but demand government intervention, despite the libertarian rhetorical flourishes of the business lobbies. We may not see the confluence of economic and political policy until after the US presidential election but the widening gap between ideology and reality may hasten the end of that peculiar conceit." }, { "docid": "464449", "title": "", "text": "If you can make the trip to BC yourself, I'd recommend opening an account with TD Canada Trust. They allow non-citizens to make accounts — apparently the only Canadian bank to do so. The customer service is great and they have a good online banking site that will allow you to manage it from the US. If you have an account with TD Bank in the US, it's also very easy to set up a TD Canada account through them that will be linked on their online site (though you will still have separate logins for both and manage them separately). I've done the reverse as a Canadian living in the US. You can set it up over the phone; their Cross-Border Banking number is listed here. They also offer better currency conversion rates than their standard ones when you do a cross-border transfer. You could also look into HSBC as well. They operate in Washington as well as across the border in BC. If you can't open a CAD account locally, they can help you open and manage one in Canada from the US. It may or may not require having a small business account instead of a personal account." }, { "docid": "77685", "title": "", "text": "Our organisation is well connected with various invigilators, British council data base managers and test centers, which enables us to register your scores in any ielts center around the world . All our certificates are original and British Council certified. If you want to make an inquiry please use below details to contact us." }, { "docid": "322838", "title": "", "text": "How much amount can we transfer from India to the USA? Is the limit per year? As I understand your father in law is Indian Citizen and his tax paid earnings need to be transferred outside of India. Under the Liberalized Remittance Scheme by RBI, one can transfer upto 2,50,000 USD. Please check with your Bank for the exact paperwork. A form 15CA and 15CB [by CA] are required to establish taxes have been paid. What documents we have to present to the bank? See above. Should money be transferred to company's account(Indian Company) to USA company? or can be transferred to my husband's account. Transfer of funds by a Indian Company to US Company has some restrictions. Please check with CA for details. If you father in law has sold the Indian Company and paid the taxes in India; he can transfer the proceeds to his son in US as per the Liberalized Remittance Scheme. Can they just gift the whole amount to my husband? What will be the tax implication on my husband's part in USA and on my father in law in India. The whole amount can be gifted by your father in law to your husband [his son]. There is no tax implication in India as being an Indian resident, gift between close relatives is tax free. There is no tax implication to your husband as he is a US Citizen and as per gift tax the person giving the gift should be paying the applicable taxes. Since the person gifting is not US Citizen; this is not applicable." }, { "docid": "48269", "title": "", "text": "\"Yes and no. There are two primary ways to do this. The first is known as \"\"cross listing\"\". Basically, this means that shares are listed in the home country are the primary shares, but are also traded on secondary markets using mechanisms like ADRs or Globally Registered Shares. Examples of this method include Vodafone and Research in Motion. The second is \"\"dual listing\"\". This is when two corporations that function as a single business are listed in multiple places. Examples of this include Royal Dutch Shell and Unilever. Usually companies choose this method for tax purposes when they merge or acquire an international company. Generally speaking, you can safely buy shares in whichever market makes sense to you.\"" }, { "docid": "205088", "title": "", "text": "As non-EU citizen who went to university in England and also doing an MBA in Spain, I can assure you they are not hard to get. It literally is filling out a form. I went to university in England because of England's strong university status and I went to university in Spain because I wanted to improve my Spanish. I'm sure a small percentage of people will maybe go to a different country due to having to fill out a visa application (maybe. We don't know if U.K. will allow visa-free studies for EU), but we don't have any way to measure the *possible* impact (if it even happens) right now. If visas were such a hurdle then why do so many students from around the world come to the USA and Canada to study? They do it because US and Canada have some of the best universities in the world and students want to improve their English - all factors that British universities still have. I get it. You don't like Brexit. But just try and look at it objectively." }, { "docid": "47579", "title": "", "text": "It is more easier if you select a Broker in India that would allow you these services. The reason being the broker in India will follow the required norms by India and allow you to invest without much hassel. Further as the institution would be in India, it would be more easy for resolving any disputes. ICICI Direct an Indian online broker allows one to trade in US stocks. For more details refer to ICIC Direct. Reliance Money also offers limited trading in US stocks. Selecting a Broker in US maybe more difficult as your would have to met their KYC norm's and also operate a Bank account in US. I am not aware of the requirements. For more details visit ICICI Direct website. Refer to http://www.finance-trading-times.com/2007/10/investing-in-us-stocks-and-options.html for a news article. TDAmeritrade or Charlesschwab are good online brokers, however from what I read they are more for US nationals holding Social Security. Further with the recent events and KYC norms becoming more stringent, it would be difficult for an individual [Indian Citizen] to open an account directly with these firms." }, { "docid": "420529", "title": "", "text": "I assume US as mhoran_psprep edited, although I'm not sure IRS necessarily means US. (It definitely used to also include Britain's Inland Revenue, but they changed.) (US) Stockbrokers do not normally withhold on either dividends/interest/distributions or realized capital gains, especially since gains might be reduced or eliminated by later losses. (They can be required to apply backup withholding to dividends and interest; don't ask how I know :-) You are normally required to pay most of your tax during the year, defined as within 10% or $1000 whichever is more, by withholding and/or estimated payments. Thus if the tax on your income including your recent gain will exceed your withholding by 10% and $1000, you should either adjust your withholding or make an estimated payment or some combination, although even if you have a job the last week of December is too late for you to adjust withholding significantly, or even to make a timely estimated payment if 'earlier in the year' means in an earlier quarter as defined for tax (Jan-Mar, Apr-May, June-Aug, Sept-Dec). See https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes and for details its link to Publication 505. But a 'safe harbor' may apply since you say this is your first time to have capital gains. If you did not owe any income tax for last year (and were a citizen or resident), or (except very high earners) if you did owe tax and your withholding plus estimated payments this year is enough to pay last year's tax, you are exempt from the Form 2210 penalty and you have until the filing deadline (normally April 15 but this year April 18 due to weekend and holiday) to pay. The latter is likely if your job and therefore payroll income and withholding this year was the same or nearly the same as last year and there was no other big change other than the new capital gain. Also note that gains on investments held more than one year are classified as long-term and taxed at lower rates, which reduces the tax you will owe (all else equal) and thus the payments you need to make. But your wording 'bought and sold ... earlier this year' suggests your holding was not long-term, and short-term gains are taxed as 'ordinary' income. Added: if the state you live in has a state income tax similar considerations apply but to smaller amounts. TTBOMK all states tax capital gains (and other investment income, other than interest on exempt bonds), and don't necessarily give the lower rates for long-term gains. And all states I have lived in have 'must have withholding or estimated payments' rules generally similar to the Federal ones, though not identical." }, { "docid": "144190", "title": "", "text": "You can receive funds from US Client as an individual. There is no legal requirement for you to have a company. If the transactions are large say more than 20 lacs in a year, its advisable to open a Private Ltd. Although its simple opening & Registering a company [A CA or a Laywer would get one at a nominal price of Rs 5000] you can do yourself. Whatever be the case, its advisable to have seperate accounts for this business / professional service transactions. Maintain proper records of the funds received. There are certain benefits you can claim, a CA can help you. Paying taxes in Advance is your responsibility and hence make sure you keep paying every quarter as advance tax. Related questions Indian citizen working from India as freelancer for U.S.-based company. How to report the income & pay tax in India? Freelancer in India working for Swiss Company Freelancing to UK company from India How do I account for money paid to colleagues out of my professional income?" }, { "docid": "598607", "title": "", "text": "So I want to sell my 100 shares of AAPL to him at a price of 10 or even 1 US Dollar. Is that legal/allowed? Of course. It's your stocks - do with it what you want. if the two persons are not served by a same broker. You'll have to talk to your broker about the technicalities of the transaction. if the person who sell are US citizen and the person who buy are not, and and vice-versa Since you asked specifically about US citizenship, I'll assume you're in the US or the transaction is taking place in the US. Citizenship has nothing to do with it (except may be for economic sanctions against Russians or Iranians that may come into play). What is important is the tax residency status. Such a transfer is essentially a gift, and if you're a US tax resident (which doesn't correlate to your immigration status necessarily) - you'll have to deal with the gift tax consequences on the discount value. For example - you have 100 shares of AAPL which you sold to your friend for $1 each when the fair market value (FMV) was $501. So essentially, the friend got $50,100 value for $100. I.e.: $50K gift. Since this amount is above the annual $14K exemption - you'll have to deal with the gift tax and file gift tax return. There are also consequences for the capital gains tax for both you and your friend. I suggest you talk to a licensed tax adviser (EA/CPA licensed in your State) about the specifics given your circumstances. If you (or the recipient) are also a foreign citizen/tax resident - then that country's laws also may affect your situation." }, { "docid": "574975", "title": "", "text": "\"sorry, my response was supposed to be to the above comment, not yours. My main point was that colonizing in Africa, where there was already a large population did not require bringing in people (which you would need to incentivize to move to, hence offering the \"\"free\"\" carrot of property rights to settlers of NA) to extract resources. Instead the British (and other European powers) just used the local populace to extract the resources. The main reason the US and Canada are well off is that property rights were established very early on and this encouraged people to \"\"invest\"\" and produce more because the higher production accrued to the producer and the producer would have legal recourse should a negative \"\"externality\"\" be put upon them by someone else. Obviously there were other reasons as well, but property rights are huge (this is true globally now) in encouraging people to \"\"grow\"\" their assets. Part of the reason Africa is still so screwed up is that many of their institutions and governments are too corrupt to protect their citizens' property rights, thereby discouraging investment and production.\"" }, { "docid": "495827", "title": "", "text": "\"Its not for US citizens - its for US residents. If the US considers you as a tax resident - you'll be treated the same as a US citizen, regardless of your immigration status. The question is very unclear, since it is not mentioned whether your US sourced income \"\"from the Internet\"\" is sales in the US, sales on-line, services you provide, investments, or what else. All these are treated differently. For some kinds of US-sourced income you should have paid taxes in the US already, regardless of where you physically reside. For others - not. In any case, if you become US tax resident, you'll be taxed on your worldwide income, not only the $10K deposited in the US bank account. ALL of your income, everywhere in the world, must be declared to the US government and will be taxed. You should seek professional advice, before you move to the US, in order to understand your responsibilities, liabilities and rights. I suggest looking for a EA/CPA licensed in California and experienced with taxation of foreigners (look for someone in the SF or LA metropolitan areas). Keep in mind that there may be a tax treaty between the US and your home country that may affect your Federal (but not California) taxes.\"" }, { "docid": "447303", "title": "", "text": "For question #1, at least some US-based online brokers do permit direct purchases of stocks on foreign exchanges. Depending on your circumstances, this might be more cost effective than purchasing US-listed ADRs. One such broker is Interactive Brokers, which allows US citizens to directly purchase shares on many different foreign exchanges using their online platform (including in France). For France, I believe their costs are currently 0.1% of the total trade value with a 4€ minimum. I should warn you that the IB platform is not particularly user-friendly, since they market themselves to traders and the learning curve is steep (although accounts are available to individual investors). IB also won't automatically convert currencies for you, so you also need to use their foreign exchange trading interface to acquire the foreign currency used to purchase a foreign stock, which has plusses and minuses. On the plus side, their F/X spread is very competitive, but the interface is, shall we say, not very intuitive. I can't answer question #2 with specific regards to US/France. At least in the case of IB, though, I believe any dividends from a EUR-denominated stock would continue to accumulate in your account in Euros until you decide to convert them to dollars (or you could reinvest in EUR if you so choose)." }, { "docid": "345942", "title": "", "text": "Am I required to send form 1099 to non-US citizens who are not even residing in the US? Since they're not required to file US taxes, do I still have to send the form to them? That's tricky. You need to get W8/W9 from them, and act accordingly. You may need to withhold 30% (or different percentage, depending on tax treaty they claim on W8). If you withhold taxes, you also need to file form 1042. I suggest you talk to a tax professional. Is it fine to expose my ITIN (taxpayer identification number) to individuals or companies who I send the form to them. Since the form requires me to write my TIN/EIN, what would be the risks of this and what precautions should be taken to avoid inappropriate/illegal use? No, it is not OK. But if you pay these people directly - you don't have much choice, so deal with it. Get a good insurance for identity theft, and don't transact with people you don't trust. One alternative would be to pay through a payment processor (Paypal or credit cards) - see your next question. I send payments via PayPal and wire transfer. Should I send form 1099-MISC or 1099-K? Paypal is a corporation, so you don't need to send 1099 to Paypal. Whatever Paypal sends to others - it will issue the appropriate forms. Similarly if you use a credit card for payment. When you send money through Paypal - you don't send money directly to your business counterparts. You send money to Paypal." }, { "docid": "397510", "title": "", "text": "You should not form a company in the U.S. simply to get the identification number required for a W-8BEN form. By establishing a U.S.-based company, you'd be signing yourself up for a lot of additional hassle! You don't need that. You're a European business, not a U.S. business. Selling into the U.S. does not require you to have a U.S. company. (You may want to consider what form of business you ought to have in your home country, however.) Anyway, to address your immediate concern, you should just get an EIN only. See businessready.ca - what is a W8-BEN?. Quote: [...] There are other reasons to fill out the W8-BEN but for most of you it is to make sure they don’t hold back 30% of your payment which, for a small company, is a big deal. [...] How do I get one of these EIN US taxpayer identification numbers? EIN stands for Employer Identification Number and is your permanent number and can be used for most of your business needs (e.g. applying for business licenses, filing taxes when applicable, etc). You can apply by filling out the Form SS-4 but the easier, preferred way is online. However, I also found at IRS.gov - Online EIN: Frequently Asked Questions the following relevant tidbit: Q. Are any entity types excluded from applying for an EIN over the Internet? A. [...] If you were incorporated outside of the United States or the U.S. territories, you cannot apply for an EIN online. Please call us at (267) 941-1099 (this is not a toll free number) between the hours of 6:00 a.m. to 11:00 p.m. Eastern Time. So, I suggest you call the IRS and describe your situation: You are a European-based business (sole proprietor?) selling products to a U.S.-based client and would like to request an EIN so you can supply your client with a W-8BEN. The IRS should be able to advise you of the correct course of action. Disclaimer: I am not a lawyer. Consider seeking professional advice." }, { "docid": "197478", "title": "", "text": "If you are a US citizen, you need to very carefully research the US tax implications of investing in foreign stocks before you do so. The US tax rules have been set up in general to make this very unattractive." } ]

[ { "docid": "153541", "title": "", "text": "\"First, filing status. If you and your wife are legally married, you should be filing your tax returns as married, either jointly or separately. In the US, \"\"head of household\"\" has a specific meaning and is for unmarried people who are supporting one or more relatives, per the IRS. If you are working full-time and your wife is not, then likely you will file a joint return, including all your income and all the expenses for your wife's business. So yes, the losses in her business will offset your income. Depending on how complex things are, you may want to hire a professional to help with your taxes. The rules for what can and cannot be deducted as a business expense can be opaque.\"" } ]

[ { "docid": "307779", "title": "", "text": "It looks like fair-market value when you receive your virtual currency is counted as income. And you're also subject to self-employment tax on that income. Here's an FAQ from the IRS: Q-8: Does a taxpayer who “mines” virtual currency (for example, uses computer resources to validate Bitcoin transactions and maintain the public Bitcoin transaction ledger) realize gross income upon receipt of the virtual currency resulting from those activities? A-8: Yes, when a taxpayer successfully “mines” virtual currency, the fair market value of the virtual currency as of the date of receipt is includible in gross income. See Publication 525, Taxable and Nontaxable Income, for more information on taxable income.Q-9: Is an individual who “mines” virtual currency as a trade or business subject to self-employment tax on the income derived from those activities? A-9: If a taxpayer’s “mining” of virtual currency constitutes a trade or business, and the “mining” activity is not undertaken by the taxpayer as an employee, the net earnings from self-employment (generally, gross income derived from carrying on a trade or business less allowable deductions) resulting from those activities constitute selfemployment income and are subject to the self-employment tax. See Chapter 10 of Publication 334, Tax Guide for Small Business, for more information on selfemployment tax and Publication 535, Business Expenses, for more information on determining whether expenses are from a business activity carried on to make a profit. You'd of course be able to offset that income with the expense of mining the virtual currency, depreciation of dedicated mining equipment, electricity, not sure what else. Edit: Here's a good resource on filing taxes with Bitcoin: Filling in the 1040 Income from Bitcoins and all crypto-currencies is declared as either capital gains income or ordinary income, for example from mining. Income Ordinary income will be declared on either your 1040 (line 21 - Other Income) for an individual, or within your Schedule C, if you are self-employed or have sole-proprietor business. Capital Gains Capital gains income, or losses, are declared on Schedule D. Since there are no reported 1099 forms from Bitcoin exchanges, you will need to include your totals with Box C checked for short-term gains, and with Box F checked for long-term gains. Interesting notes from that article, your first example could actually be trickier than expected if you started mining before there was a Monero to USD exchange. Also, there can also be capital gains implications from using your virtual currency to buy goods, which sounds like a pain to keep track of." }, { "docid": "362060", "title": "", "text": "I am not an accountant, but I have a light accounting background, despite being primarily an engineer. I also have a tiny schedule C business which has both better and worse years. I am also in the United States and pay US taxes. I assume you are referring to the US Form 1040 tax return, with the attached Schedule C. However little I know about US taxes, I know nothing about foreign taxes. You are a cash-basis taxpayer, so the transactions that happen in each tax year are based on the cash paid and cash received in that year. You were paid last year, you computed your schedule C based on last year's actual transactions, and you paid taxes on that income. You can not recompute last years schedule C based on the warranty claim. You might want to switch to an accrual accounting method, where you can book allowances for warranty claims. It is more complex, and if your business is spotty and low volume, it may be more trouble than it is worth. At this point, you have two months to look for ways to shift expenses into next year or being income into this year, both of which help offset this loss. Perhaps a really aggressive accountant would advise otherwise (and remember, I am not an accountant), but I would take the lumps and move on. This article on LegalZoom (link here) discusses how to apply a significant net operating loss (NOL) in this year to the previous two years, and potentially carry it forward to the next two years. This does involve filing amended returns for the prior two years, showing this year's NOL. For this to be relevant, your schedule C loss this year must exceed your other W2 and self-employment income this year, with other tests also applied. Perhaps a really aggressive accountant would advise otherwise (and remember, I am not an accountant), but I would take the lumps and move on." }, { "docid": "114857", "title": "", "text": "The cap loss can be used to offset future gains or $3000/yr of ordinary income. (I just used up the last of mine from the dot com bubble.) I hope you have future gains that let you use this up quickly. The IRS debt is separate, and I don't imagine they'll let you use any of the loss to offset it. As always, it can't hurt to ask. Their normal payment plans are for 5 years. $40k/yr is a lot. Edit - The IRS does negotiate. I recall, from the dot-com bubble, instances where someone exercised stock grants, but kept the shares. Now, they had a $1M gain, but after year end, the stock crashed. They owed tax on that gain, but the loss was in the next tax year, with nothing to offset. These people were 'regular' guys and gals, no background in finance. I understand the IRS looked at these people and made some exceptions." }, { "docid": "306180", "title": "", "text": "SXL is a Master Limited Partnership so all of the income is pass-through. Your equity purchase entitles you to a fraction of the 66% of the company that is not owned by Energy Transfer Partners. You should have been receiving the K-1s from SXL from the time that you bought the shares. Without knowing your specific situation, you will likely have to amend your returns for at most 6 years (if the omitted amount of gross income exceeds 25% of your gross income originally stated as littleadv has graciously pointed out in the comments) and include Schedule E to report the additional income (you'll also be able to deduct any depreciation, losses etc. that are passed through the entity on that form, so that will offset some of the gains). As littleadv has recommended, speak with a tax professional (CPA/EA or attorney) before you take any further steps, as everyone's situation is a bit different. This Forbes article has a nice overview of the MLP. There's a click-through to get to it, but it's not paywalled." }, { "docid": "316932", "title": "", "text": "As a sole trader you would fill out an Individual Tax Return and complete the Business and Professional Items Section P1 to P19, then enter the amounts from that section into Item 15 in the Supplementary Section of the Tax Return. Any business income as a sole trader will be included into your taxable income for the year together with other sources of income you may have earned in the same income year. Whether you get a tax refund will depend on the amount of taxable income you make, the amount of tax you have already paid in instalments throughout the year, and any tax deductions and tax offsets you can claim." }, { "docid": "542213", "title": "", "text": "\"From the IRS perspective, there's no difference between \"\"your taxes\"\" and \"\"your sole proprietorship's taxes\"\", they're all just \"\"your taxes\"\". While I could see it being very useful and wise to track your business's activities separately, and use separate bank accounts and the like, this is just a convenience to help you in your personal accounting, and not something that needs to relate directly to how tax forms are completed or taxes are paid. When calculating your taxes, if you want to figure out how much \"\"you\"\" owe vs. how much \"\"your business\"\" owes, you'll have to do so yourself. One approach might be just to take the amount that your Schedule C puts as income on your return and multiply by your marginal tax rate. Another approach might be to have your tax software run the calculations as though you had no business income, and see what just \"\"your personal\"\" taxes would have been without the business. If you think of the business income as being \"\"first\"\" and should use up the lower brackets rather than your personal income, maybe do it the other way around and have your software run the calculations as though you had only the business income and no other personal/investment income, and see what the amount of taxes would be then. Once you've figured out a good allocation, the actual mechanics of paying some \"\"personal tax amount\"\" from your personal bank account and some \"\"business tax amount\"\" from your business bank account are up to you. I'd probably just transfer the money from my business account to my personal account and pay all the taxes from the personal account. Writing two separate checks, one from each account, that total to the correct amount, I'm sure would work just fine as well. You can probably make separate payments from each account electronically through Direct Pay or EFTPS as well. As long as all taxes are paid by the deadline, I don't think the IRS is too picky about the details of how many payments are made.\"" }, { "docid": "351137", "title": "", "text": "I haven't seen anyone mention tax considerations and that's why I'm answering this. The rest of my answer is probably covered in the aggregate of other responses. Here's how I would look at this in a taxable (not an IRA) account: This could be an opportunity to harvest the tax losses to offset taxable gains this year or in future years. Unless I have compelling reasons to believe that the price will recover by at least (Loss% x ApplicableTaxRate) in the next 31 days then I would take the known - IRS tables - opportunities over the unknown. Here's what I would consider for all accounts: Is this the most likely place to earn a good return on my money and is it contributing to a strategy that fits my risk tolerance? You might need to get some emotional distance from the pain to make this determination objectively. As you consider your trading and investment strategy going forward consider that when it hurts and you have to pull yourself up by the bootstraps to think clearly about your situation, you were most likely trading with too much size for you in that particular position. I'm willing to make exceptions to that rule of thumb, but it's a good way to use the painful losses as a gut check on how your strategy fits your real situation. P.S. All traders experience individual losses that hurt and find their way to the most suitable strategies for them through these painful experiences." }, { "docid": "313361", "title": "", "text": "\"If this is truly hobby income (you do not intend to operate as a business and don't have a profit motive) then report the income on Line 21 (\"\"other income\"\") of form 1040. If this is a business, then the income and expenses belong on a Schedule C to form 1040. The distinction is in the treatment of profits and losses - your net profits on a business are subject to self-employment tax, while hobby income is not. Net losses on a business are deductible against other income; net losses on a hobby are miscellaneous itemized deductions in the \"\"2%\"\" box on Schedule A. From a tax point of view, selling apps and accepting donations are different. Arguably, donations are gifts; gifts are not taxable income. The hobby/business and income/gift distinctions are tricky. If the dollar amounts are small, nobody (including the IRS) really cares. If you start making or losing a lot of money, you'll want to get a good tax person lined up who can help you decide how to characterize these items of income and expens, how to put them on your return, and how to defend the return on audit if necessary.\"" }, { "docid": "564453", "title": "", "text": "It will depend on how much you expect to earn this way, and whether you expect the company to become profitable soon. Has the company just not made a profit yet, or has it actually made a significant loss that your invoices would just be offsetting? If you're earning over £10,000 per year then invoicing through the company is preferable. Above that level, you'd be taking money from the company as dividends after paying 20% corporation tax with no other tax to pay on your personal tax return. As a sole trader you'd be paying 20% income tax and 9% NI. (Note however that the company can only pay dividends from profits, which is a problem if there are significant losses to offset.) Below £10,000, there's little difference. Through the company, you can take a salary of £7956 per year without paying any income tax or NI. With the new £2000 discount on employers' NI you could then take salary up to £10,000 and just pay 12% employee's NI. As a sole trader, you pay 9% Class 4 NI over £7956 and a fixed £143 per year for Class 2 NI. Paying 9% rather than 12% saves you £60, but then you add the £143. In practice the company would work out more expensive at this level because you'll probably want to pay an accountant to deal with the payroll for you. Having the company repay your £2000 from the invoices doesn't really save any tax if the company will become profitable in the future. You don't pay any tax now since the money you receive isn't income, and the company doesn't pay any tax if the extra £2000 of revenue doesn't put it back in profit. However, if the company is profitable next year then it will have an extra £2000 of profit that would otherwise have been offset against this year's loss, and you do end up paying 20% corporation tax on the £2000. You could still have the company repay the loan in order to delay the tax liability, but it's not really tax free money. Loaning additional money to the company has no tax benefit, you just give the company £1000 and get your original £1000 back later. You pay no tax and neither does the company, but it was your money in the first place." }, { "docid": "447593", "title": "", "text": "Based on my research, the answer is both. You would pay taxes on the bitcoin you mine as income, and then capital gains tax when you sell them for a profit (or capital loss if you lose value on the sale). You can write off a portion of your electricity bill and hardware purchased for the use of mining as a business expense, but it's recommended that you consult a tax professional for determining the proper amount that is eligible for a deduction. From Forbes: New Bitcoin are being issued by the system roughly every 10 minutes by a process called mining. In mining, computers running the Bitcoin software around the world attempt to solve math problems and the first computer to come up with the solution adds the most recent transactions to the ledger of all Bitcoin transactions, plus receives the new bitcoins created by the system, called the block reward. If you are a miner and win the block reward, you must record the fair market value of Bitcoin that day and mark that as an addition to your personal or business income. Also note the date and timestamp at which your coins were mined. Later, when you dispose of those Bitcoin, you will subtract the date of acquisition from the date of disposal, and you will be taxed a long-term capital gains rate on any Bitcoin you held for more than a year, and a short-term capital gains rate on any Bitcoin you held for a year or less. (The timestamp isn’t absolutely necessary, but is helpful to validate the order of multiple acquisitions or disposals within a day.) The amount you pay in taxes on a long-term capital gain will depend on your income-tax bracket, while short-term capital gains are taxed the same as ordinary income. From bitcoin.tax: Another clarification in the IRS's March notice was how mining should be treated. Mining is income, on the day of receipt of any coins and at the fair value of those coins. This means that if you mined any Bitcoins or alt-coins either solo, as part of a pool, or through a cloud provider, you need to report any coins you received as income. Where it is less clear, is what that dollar value might be, since the fair value is not always as easy to determine. Bitcoins, Litecoins, Dogecoins, are all examples of where there is a direct USD market and so you can easily find out their value of any given day. However, a newly created alt-coin that was mined in its early days has no direct market and so how do you determine its value? Or for any alt-coin, e.g. ABC coin, that has no direct USD market but does have a BTC market. Does it have a value? Do you have to make a conversion from ABC to BTC to USD? Since there is no clarification yet from the IRS on this issue you should discuss how to proceed with your own tax professional. BitcoinTaxes has taken a prudent approach and calculates value where a fiat or BTC market exists, converting an alt-coin to BTC to USD as necessary. And from Bitcoin magazine: The IRS also stated mined bitcoins are treated as immediate income at the market value of those mined coins on their date of mining. “Most don’t know they can write off any losses they have,” said Libra founder Jake Benson. “The IRS allows you to offset income by up to $3,000 per year on capital losses. If you have losses and you aren’t writing them off, then it’s like throwing money away. Nobody likes doing taxes, but if you can owe less or increase your return, then doing your Bitcoin taxes often results in a benefit. In fact, the majority of our users are filing a capital loss, which means they’ve actually saved money by using our tool.” Benson also gives insight for miners. “Mining is considered income, so know the price of Bitcoin at the time you mined it,” he said. “If you make money on Bitcoin trading, the IRS requires that you report gains with line level detail.” The appropriate form for that is 8949, a sub-form of schedule D. Gains and losses, as outlined above, are treated like every other capital asset." }, { "docid": "484301", "title": "", "text": "My household is well into the top 10% of income in the U.S. and I have absolutely no problem paying my fair share of taxes. I grew up poor and have been homeless. My wife wasn't much better off growing up the daughter of a truck driver. Now, I am senior management at a tech firm and she is a research scientist with a PhD in neuroscience. If not for a little bit of luck we would be living very different lives. We need the United States to become a true meritocracy. There are too many people like myself and my wife - who had the talent to achieve really awesome lives for ourselves - that were never given the opportunity to go to college, let alone grad school. Don't get me wrong. I took every opportunity that showed a glimmer of hope while I worked my ass off (at one point, I was working one full time job and another job that was at least 30 hours a week while holding down 12 to 15 credits of classes every semester), but I want everyone to have just the opportunity to be the best person they can be. Obviously, opportunity does not equate to success, but opportunity should be enough. We are letting the next great business leaders, scientists, doctors, and engineers squander their potential in poverty and not only is this inexcusable on the micro level, it makes us weaker as a nation. I will *never* understand how my peers don't understand this." }, { "docid": "391573", "title": "", "text": "I agree with Option 3 from the accepted answer (His/Hers/Joint), but with one caveat (that my wife and I are finding out). Once you have children, if your income is in the mid-range where you are not paycheck to paycheck, but are not floating in excess money either (ie, you can have a vacation, but you have to plan for it and save up for a few months to do so), the child-relative expenses begin to be a huge factor in your overall budget, such that (particularly if one partner does more of the child-related buying) it can be hard to really keep up the 3 account separation, because those child-related expenses may end up being all of one earner's paycheck. We originally did the 3 way split, where we took rent, car, and utilities from joint (ie, each transferred a reasonable portion to the joint account to cover), and just bought groceries each occasionally such that it was generally a reasonable split (as we both shopped for groceries and both earned close enough to each other that it worked out). But once we had kids, it ended up being very different, and we eventually had to more properly budget all of our funds as if they were basically joint funds. While we still do have separate accounts (and, largely, separate credit cards/etc., except for one joint card), it's almost pro forma now due to the kids." }, { "docid": "142966", "title": "", "text": "I believe different banks have slightly different experiences. My wife and I have both joint and individual accounts. When I sign in, I see Joint, Mortgage and Joe. When She logs in, she sees Joint, Mortgage, and Jane. It happens that the Mortgage and Joint accounts have her Social Security number attached. Aside from that, I don't feel like I am an afterthought." }, { "docid": "508706", "title": "", "text": "There is very little effect whatsoever of having a joint bank account--positive or negative. Positive effects: It would be very easy to send your mother money...she can just take it out of the account. If you passed away she could get the money without having to use the legal system (or vice versa). This latter effect is why I have a bunch of joint accounts with my wife...if either of us died I wouldn't want getting access to our money to be an additional hassle. Negative effects: She is able to access money in that account without your consen, which you have pointed out is not going to happen. The case I'm thinking of would be something like a tax lien against her. A government agency might choose to pull money out of that joint account. That would be a downside for you. If we were discussing credit cards, a loan, or a line of credit, there would be a number of legal and credit-rating effects from joint ownership. Not so much with checking accounts." }, { "docid": "490176", "title": "", "text": "\"Individuals most definitely can have NOL. This is covered in the IRS publication 536. What is the difference between NOL and capital loss? NOL is Net Operating Loss. I.e.: a situation where your (allowable) expenses and deductions exceed your gross income. Basically it means that you have negative income for that year, for tax purposes. Capital loss occurs when the total amount of your capital gains reported on Schedule D is negative. What are their relations then? Not all expenses and deductions that you usually put on your tax return are allowed for NOL calculation. For example, capital loss is not allowed. I.e.: if you earned $2000 and you lost in stocks $3000 - you do not get a $1K NOL. Capital losses are excluded from NOL calculation and in this scenario you still have non-negative income for NOL purposes even though it is offset in full by capital loss deduction and your \"\"taxable income\"\" line is negative. The $1K that was not allowed - gets carried forward to the next year using the Capital Loss Carryover Worksheet in the instructions to Schedule D. You calculate your NOL using form 1045 schedule A. You can use the form 1045 to apply the NOL to prior 2 years, or you can elect to apply it only to future years (up to 20 years). In what cases, capital loss can be NOL? Never.\"" }, { "docid": "435320", "title": "", "text": "My wife and I chose to share all bank accounts and credit cards. We did so because we realized that, over the course of a marriage, the pendulum of who is the primary breadwinner may shift repeatedly. Having one account gets us in the habit of thinking about our needs and wants together and eases any transitions that may come as one or the other of us quits a job/returns to school/reduces hours. I should also say that this system would likely not work well if either partner has semi-compulsive spending/consumption habits. I'd recommend separate bank accounts with a joint account for your mortgage in that situation." }, { "docid": "105543", "title": "", "text": "So long as you don't hate what you are doing, I'd say the price is somewhere in the neighborhood of $100-200 year of income to be worth the bookkeeping. I'd only say more than that if you have a ridiculously complex tax situation, you have an irrational hatred of filling out a few forms once a year, or if you just have such a stupidly large amount of money that even having a few hundred dollars a year to donate to people in desperate need just doesn't mean anything to you. Or if you are under special income limits and just a few dollars of income would put you in a bad situation (like a loss of medical benefits, etc). The reason is actually quite simple: the taxes aren't really that hard or time consuming. I've handled three self-employment businesses in my life, and unless you are trying to itemize every last dollar of business deductions and expenses, or you really want to scrape out every last cent from minor deductions that require considerable extra paperwork, it's a few extra forms on your taxes. Most of the extra taxes are as a percentage, so it reduces the benefits, but really not by much. You don't have to make it extra complicated if the extra complexity doesn't give you a big payoff in benefit. I would suggest you pick the simplest imaginable possible system for accounting for this, so that you might only spend an extra few hours per year on the books and taxes. Don't keep $10 sheet music receipts if you feel it's a burden to try to itemize expenses, etc. Instead, the decision should be if you (or in this case your wife) would enjoy doing it, and bringing in money can just be nice in it's own way. I'd suggest she keep some out for little extra niceties, earmark some for feel-good charitable giving, and then of course sock away the rest. Don't let extra income be an unnecessary burden that prevents you from getting it in the first place." }, { "docid": "93205", "title": "", "text": "For some reason this can result in either the flow through income being UNTAXED or the flow through income being taxed as a capital gains. Either way this allows a lower tax rate for LLC profits. I'm not sure that correct. I know it has something to do with capital accounts. This is incorrect. As to capital accounts - these are accounts representing the members/partners' capital in the enterprise, and have nothing to do with the tax treatment of the earnings. Undistributed earnings add to the capital accounts, but they're still taxed. Also, is it true that if the LLC loses money, that loss can be offset against other taxable income resulting in a lower total taxation? It can offset taxable income of the same kind, just like any other losses on your tax return. Generally, flow-through taxation of partnerships means that the income is taxed to the partner with the original attributes. If it is capital gains - it is taxed as capital gains. If it is earned income - it is taxed as earned income. Going through LLC/partnership doesn't re-characterize the income (going through corporation - does, in many cases)." }, { "docid": "437907", "title": "", "text": "The dividend tax credit is not applicable to foreign dividend income, so you would be taxed fully on every dollar of that income. When you sell a stock, there will be a capital gain or capital loss depending on if it gained or lost value, after accounting for the Adjusted Cost Base. You only pay income tax on half of the amount earned through capital gains, and if you have losses, you can use them to offset other investments that had capital gains (or carry forward to offset gains in the future). The dividends from US stocks are subject to a 15% withholding tax that gets paid to the IRS automatically when the dividends are issued. If the stocks are held in an RRSP, they are exempt from the withholding tax. If held in a non-registered account, you can be reimbursed for the tax by claiming the foreign tax credit that you linked to. If held in a TFSA or RESP, the withholding tax cannot be recovered. Also, if you are not directly holding the stocks, and instead buy a mutual fund or ETF that directly holds the stocks, then the RRSP exemption no longer applies, but the foreign tax credit is still claimable for a non-registered account. If the mutual fund or ETF does not directly hold stocks, and instead holds one or more ETFs, there is no way to recover the withholding tax in any type of account." } ]

[ { "docid": "202630", "title": "", "text": "You cannot do a like-kind (Sec. 1031) exchange for personal property, only for business/investment property. Since you said that you traded in your personal car - no like-kind exchange is possible. Also, since the new car doesn't belong to you - you didn't actually perform any exchange. You sold your old car, but you didn't buy a new one. If Turbo-Tax suggests you to fill the exchange form - you must have entered something wrong to make it think there was an exchange. Check your entries again, specifically - check if you entered that you purchased a new car instead of the old one, since you didn't. See an example of where to start looking here." } ]

[ { "docid": "95120", "title": "", "text": "\"Let's assess the situation first, then look at an option: This leaves you with about $1,017/mo in cash flow, provided you spend money on nothing else (entertainment, oil changes, general merchandise, gifts, etc.) So I'd say take $200/mo off that as \"\"backup\"\" money. Now we're at $817/mo. Question: What have you been doing with this extra $800/mo? If you put $600/mo of that extra towards the 10% loan, it would be paid off in 12 months and you would only pay $508 in interest. If you have been saving it (like all the wisest people say you should), then you should have plenty enough to either pay for a new transmission or buy a \"\"good enough\"\" car outright. 10% interest rate on a vehicle purchase is not very good. Not sure why you have a personal loan to handle this rather than an auto loan, but I'll guess you have a low credit score or not much credit history. Cost of a new transmission is usually $1,700 - $3,500. Not sure what vehicle we're talking about, so let's make it $3,000 to be conservative. At your current interest rate, you'll have paid another $1,450 in interest over the next 33 months just trying to pay off your underwater car. If you take your old car to a dealership and trade it in towards a \"\"new to you\"\" car, you might be able to roll your existing loan into a new loan. Now, I'm not sure when you say personal loan if you mean an official loan from a bank or a personal loan from a friend/family-member, so that could make a difference. I'm also not sure if a dealership will be willing to recognize a personal loan in the transaction as I'd wager there's no lien against the vehicle for them to worry about. But, if you can manage it, you may be able to get a lower overall interest rate. If you can't roll it into a new financing plan, then you need to assess if you can afford a new loan (provided you even get approved) on top of your existing finances. One big issue that will affect interest rates and approvals will be your down payment amount. The higher it is, the better interest rate you'll receive. Ultimately, you're in a not-so-great position, but if your monthly budget is as you describe, then you'll be fine after a few more years. The perils of buying a used car is that you never know what might happen. What if you don't repair your existing car, buy another car, and it breaks down in a year? It's all a bit of a gamble. Don't let your emotions get in the way of making a decision. You might be frustrated with your current vehicle, but if $3,000 of repairs makes it last 3 more years, (by which time your current loan should be paid off), then you'll be in a much better spot to finance a newer vehicle. Of course it would be much better to save up cash over that time and buy something outright, but that's not always feasible. Would you rather fix up your current car and keep working to pay down the debt, or, would you rather be rid of the car and put $3,000 down on a \"\"new to you\"\" car and take on an additional monthly debt? There's no single right answer for you. First and foremost you need to assess your monthly cash flow and properly allocate the extra funds. Get out of debt as soon as reasonably possible.\"" }, { "docid": "556558", "title": "", "text": "\"I think the part of your question about not wanting to \"\"mess up more\"\" is the most important element. You say you know someone with good credit who is willing to co-sign for you, but let's be honest -- your credit isn't bad for no reason. Your credit's bad because you have a history of not paying on your obligations. Putting someone else's credit at risk, even though they may be willing to try and help, could be doing exactly what you said you're trying to avoid -- messing up more. This person's heart is in the right place, but you really have to ask yourself if you should put them in jeopardy by agreeing to guarantee your debts. So the vehicle you bought is older and has a lot of miles -- you knew that when you bought it. So you're paying a high interest rate because of your bad credit history -- you knew that when you bought it. Why you think the vehicle's only going to last another year is what confuses me. There are many vehicles out there with much higher mileage that are still on the road, and with proper preventative maintenance there's no reason your truck can't do the same. The fact is, you just don't like what you're paying or what you're driving (even though you were good with both when someone was willing to extend you credit), so now you see this other person's willingness to co-sign for you as your ticket out of a situation you no longer want to be in. My suggestion is that you stay with the loan you have, take care of the vehicle to make it last, and prove that you can pay your obligations. Hopping from loan to loan isn't going to do your credit any favors. One of the big factors for your credit score is the average age of accounts. Going and signing a new loan now will only drag that number down and hurt your score, not help it. And there's no guarantee the next car you buy with your friend's help is going to last the length of that loan either. I would be careful about this \"\"grass is greener on the other side\"\" attitude and just bear through your situation, if only to prove to yourself that you can do it. There's nothing saying your friend won't still be willing to co-sign for you later on down the line of something does happen to the truck, but you can show them that you're trying to be responsible in the meantime by following through on what you already agreed to.\"" }, { "docid": "85447", "title": "", "text": "One of the best things you can do for this purpose, while getting a modest ROI on a passive investment, is invest in a company that profitably does whatever you want to see more of. For example, you could invest in a for-profit company that sells needed goods to low-income people at lower prices. Something like Wal-Mart, which is one of the most effective anti-poverty engines in the US. You might also say the same of something like Aldi (owner of Aldi stores and Trader Joe's), which is a discount store chain. This is true even though a company like Wal-Mart is seeking to make money first. Its customer base tends to skew heavily towards low-income consumers, and historically to rural and elderly consumers. When Wal-Mart is able to provide food, clothing, appliances and the like to poor people at a lower cost, it is making it marginally less painful to have a low income. Peter Suderman can explain why Wal-Mart is a humanitarian enterprise: Walmart’s customer base is heavily concentrated in the bottom income quintile, which spends heavily on food. The bottom income quintile spends about 25 percent of income on food compared to just 3.5 percent for the top quintile. So the benefits of Walmart’s substantially lower prices to the lowest earning cohort are huge, especially on food. As Suderman points out, this view of Wal-Mart dramatically lowering prices that low-income people pay for food was corroborated by an Obama adviser. That's just one company. You can pick the industry and company that best suits your personal preferences. Alternatively, you could invest in something like Whole Foods, a company with multiple missions to improve the planet and the community, in addition to the more typical mission of being a prosperous retail chain. Of course, as a general proposition, a less than entirely altruistic, charity-inclined investment doesn't need to be targeted at those with low incomes or at saving the planet. You could invest in almost anything you think is good (yachts, yo-yos, violins, energy production, industrial inputs, music performances) and the company will take care of making more of that good thing. You didn't say whether your goal was to help the poor, the planet, arts, sciences, knowledge, community, or whatever. What I understand you to be saying is you are willing to accept a lower ROI in exchange for some warm-fuzzies from your investment. That seems perfectly valid and reasonable to me, but it makes it much more subjective and particular to your tastes. So you'll need to pick something that's meaningful to you. If you're going to trade ROI for positive feelings, then you should pick whatever gives you your optimal blend of emotions and returns. Alternatively, you could invest in something stable and predictable to beat inflation (some sort of index or fund) and then annually use some portion of those profits to simply give to the charity of your choice. Your investment and your charity do not necessarily need to be the same vehicle." }, { "docid": "574654", "title": "", "text": "I would say that, for the most part, money should not be invested in the stock market or real estate. Mostly this money should be kept in savings: I feel like your emergency fund is light. You do not indicate what your expenses are per month, but unless you can live off of 1K/month, that is pretty low. I would bump that to about 15K, but that really depends upon your expenses. You may want to go higher when you consider your real estate investments. What happens if a water heater needs replacement? (41K left) EDIT: As stated you could reduce your expenses, in an emergency, to 2K. At the bare minimum your emergency fund should be 12K. I'd still be likely to have more as you don't have any money in sinking funds or designated savings and the real estate leaves you a bit exposed. In your shoes, I'd have 12K as a general emergency fund. Another 5K in a car fund (I don't mind driving a 5,000 car), 5k in a real estate/home repair fund, and save about 400 per month for yearly insurance and tax costs. Your first point is incorrect, you do have debt in the form of a car lease. That car needs to be replaced, and you might want to upgrade the other car. How much? Perhaps spend 12K on each and sell the existing car for 2K? (19K left). Congratulations on attempting to bootstrap a software company. What kind of cash do you anticipate needing? How about keeping 10K designated for that? (9K left) Assuming that medical school will run you about 50K per year for 4 years how do you propose to pay for it? Assuming that you put away 4K per month for 24 months and have 9K, you will come up about 95K short assuming some interests in your favor. The time frame is too short to invest it, so you are stuck with crappy bank rates." }, { "docid": "75132", "title": "", "text": "Many Web sites and articles warn against buying former rental cars, because people renting these cars often mistreat them. Rental cars are typically driven by people over 25, these are typically people with some financial means (air travel, credit card). Additionally, rental cars are subject to frequent inspection and likely to be on tighter maintenance schedules than many owners would keep. So while some people may drive a rental harder than they would their own car, it's not typical, and not likely to result in some hidden damage that makes a rental less desirable (all else being equal) on the used-car market. Does the fact that they sell the car mean during this time suggest that they know the car's cost of further maintenance or other costs will be higher? Or is there another reason they sell at this time which, has a calculated advantage to them, but which is less than idea statistically for me, the purchaser? Rental companies buy at incredible volumes, as such, some manufacturers have programs where they will buy back used cars from the rental company at a set price and/or time. Other incentives are guaranteed depreciation, wherein the manufacturer will make up the difference if the used vehicle doesn't sell for a set percentage of it's purchase price after a set amount of time. Outside of these incentive programs, rental companies also get substantial volume discounts, and they typically are buying base models which hold value better than their higher-trim counterparts (according to KBB market analyst). So the conventional wisdom about depreciation doesn't really apply. The timing of their sales is primarily based on their purchasing arrangements and their desire to keep an up to date fleet, not on projected maintenance/repair costs. The best you can do with any used-car purchase is to test-drive, get a pre-purchase inspection, and review whatever history is available." }, { "docid": "39265", "title": "", "text": "In addition to the higher risk as pointed out by @JamesRoth, you also need to consider that there are regulations against 'naked shorting' so you generally need to either own the security, or have someone that is willing to 'loan' the security to you in order to sell short. If you own a stock you are shorting, the IRS could view the transaction as a Sell followed by a buy taking place in a less than 30 day period and you could be subject to wash-sale rules. This added complexity (most often the finding of someone to loan you the security you are shorting) is another reason such trades are considered more advanced. You should also be aware that there are currently a number of proposals to re-instate the 'uptick rule' or some circuit-breaker variant. Designed to prevent short-sellers from driving down the price of a stock (and conducting 'bear raids etc) the first requires that a stock trade at the same or higher price as prior trades before you can submit a short. In the latter shorting would be prohibited after a stock price had fallen a given percentage in a given amount of time. In either case, should such a rule be (re)established then you could face limitations attempting to execute a short which you would not need to worry about doing simple buys or sells. As to vehicles that would do this kind of thing (if you are convinced we are in a bear market and willing to take the risk) there are a number of ETF's classified as 'Inverse Exchange Traded Funds (ETF's) for a variety of markets that via various means seek to deliver a return similar to that of 'shorting the market' in question. One such example for a common broad market is ticker SH the ProShares Short S&P500 ETF, which seeks to deliver a return that is the inverse of the S&P500 (and as would be predicted based on the roughly +15% performance of the S&P500 over the last 12 months, SH is down roughly -15% over the same period). The Wikipedia article on inverse ETF's lists a number of other such funds covering various markets. I think it should be noted that using such a vehicle is a pretty 'aggressive bet' to take in reaction to the belief that a bear market is imminent. A more conservative approach would be to simply take money out of the market and place it in something like CD's or Treasury instruments. In that case, you preserve your capital, regardless of what happens in the market. Using an inverse ETF OTOH means that if the market went bull instead of bear, you would lose money instead of merely holding your position." }, { "docid": "293620", "title": "", "text": "You're on the right track with buying clunkers, but letting your current cars get repossessed is a bad idea for the reasons you specified. First, find an insurance broker instead of an insurance agent. A broker works with dozens of companies, many of which you may not have heard of. He is in a better position to find you the best deal than you are because he is familiar with more insurance company products than you are. He doesn't charge you extra for this service. Second, ask your insurance broker if he can find any insurers offering discounts for persons who have passed a driver training course. Find an accredited course and determine pricing. If the savings exceed the cost of the course, take the course. Third, if you have outstanding loans on your vehicles, pay them off and sell the cars. Replace them with vehicles you can purchase outright with cash. Make sure you have enough money to replace them again should another accident happen. Once you have vehicles that are lein-free there is no longer a requirement by the lender for you to have insurance for the replacement value of the vehicle, which is what's killing your rates right now. Find out what the minimum legal requirement for auto insurance is in your state. In Canada, the minimum requirement is $100,000 liability. Anything else is either a sales job or a lender requirement. Getting your wife to insure her own vehicle may help, getting your insurance under her name may also be something to look into. Since you seem to have issues with people bumping into you and there have been no medical issues, $100,000 liability may be all you need. Note: Tactic #3 is not without risk. If you are in an at-fault accident, you will have to pay for any damages exceeding your insured limit out of your own pocket. Any damages to your own vehicle whether at-fault or not will have to be paid out of your own pocket. If you are sued for medical expenses incurred by other parties, you'll have to pay anything over and above your insured limit out of your own pocket. If there is anything you are unclear about on your insurance policy, ask your agent/broker to explain until you do understand. Buying auto insurance without fully understanding what you are paying for is another risk." }, { "docid": "567964", "title": "", "text": "\"&gt; That's not a taxi regulation, that's just a driving regulation: all vehicles must be insured. Are you saying that Uber/Lyft aren't even following the laws of the road? When you're driving to a call, you're working as a cab driver, or if you don't like that label, you're operating a commercial vehicle. Regular car insurance does not cover operating a vehicle for the purposes of transporting people, a.k.a. driving a taxi. There is special insurance for taxi companies because they have much higher liability and likelihood of being in an accident, thus the premiums are higher. Uber/Lyft drivers do not have this type of insurance individually, but Uber/Lyft each have a \"\"$1m insurance policy\"\" in case their drivers are in accidents **when they are loaded**. It doesn't cover them between calls. When an Uber/Lyft driver gets in an accident between calls, their insurance isn't going to cover it because they were operating a taxi, or a vehicle that transports people for money. Their insurance will drop their policy, and they will be liable for the damages, which they likely won't be able to pay out of pocket or they wouldn't be driving for Uber/Lyft in the first place. &gt; Taxi regulations actually allow red-lining by restricting service areas: \"\"sorry, I don't go to x town - I'm only licensed for y town.\"\" Even with the regulations, taxis do it anyway. That's why they ask for your destination before they give you an ETA on pickup You have no idea what red-lining is. &gt; Rate-setting isn't a good thing. Yes, it is actually. It keeps the prices stable and manageable. Without prices would drastically increase, which seems to be a big complaint in this thread. &gt; Yep. The taxi regulations should largely be repealed: they've outlived their usefulness Again, you don't have a fucking clue what you're talking about. Many cities have tried to deregulate their cab industries and all but one in the US has returned to some form of regulation. It's been a complete shit show every time. Service quality went down and prices went up. See, the thing people in this thread people don't get is I actually know how cab drivers think because I personally know 200 of them. They would absolutely love to have the industry deregulated because then they wouldn't have to take drunk assholes that call for a cab, they could just take the decently sober guy offering them an extra $20. They wouldn't have to drive to the shitty parts of town where they're most likely to get robbed. They wouldn't even have to give rides to shady looking people who are probably going to bail on their fare. Got a wheelchair? Fuck if anyone wants to lift that into the trunk. You want that short ride that only goes three blocks because you're wearing your hootchy skirt with 6\"\" heels? Why bother? Oh it's 2am on New Year's Eve/Day and you want a ride? And you're freezing your ass off? Ok, how about $80? No? Well the guy behind you with his girlfriend crying will pay it. He won't like it, but it beats being stuck downtown all night.\"" }, { "docid": "517323", "title": "", "text": "The stock market is just like any other market, but stocks are bought and sold here. Just like you buy and sell your electronics at the electronics market, this is a place where buyers and sellers come together to buy and sell shares or stocks or equity, no matter what you call it. What are these shares? A share is nothing but a portion of ownership of a company. Suppose a company has 100 shares issued to it, and you were sold 10 out of those, it literally means you are a 10% owner of the company. Why do companies sell shares? Companies sell shares to grow or expand. Suppose a business is manufacturing or producing and selling goods or services that are high in demand, the owners would want to take advantage of it and increase the production of his goods or services. And in order to increase production he would need money to buy land or equipment or labor, etc. Now either he could go get a loan by pledging something, or he could partner with someone who could give him money in exchange for some portion of the ownership of the company. This way, the owner gets the money to expand his business and make more profit, and the lender gets a portion of profit every time the company makes some. Now if the owner decides to sell shares rather than getting a loan, that's when the stock market comes into the picture. Why would a person want to trade stocks? First of all, please remember that stocks were never meant to be traded. You always invest in stocks. What's the difference? Trading is short term and investing is long term, in very simple language. It's the greed of humans which led to this concept of trading stocks. A person should only buy stocks if he believes in the business the company is doing and sees the potential of growth. Back to the question: a person would want to buy stocks of the company because: How does a stock market help society? Look around you for the answer to this question. Let me give you a start and I wish everyone reading this post to add at least one point to the answer. Corporations in general allow many people come together and invest in a business without fear that their investment will cause them undue liability - because shareholders are ultimately not liable for the actions of a corporation. The cornerstone North American case of how corporations add value is by allowing many investors to have put money towards the railroads that were built across America and Canada. For The stock market in particular, by making it easier to trade shares of a company once the company sells them, the number of people able to conveniently invest grows exponentially. This means that someone can buy shares in a company without needing to knock door to door in 5 years trying to find someone to sell to. Participating in the stock market creates 'liquidity', which is essentially the ease with which stocks are converted into cash. High liquidity reduces risk overall, and it means that those who want risk [because high risk often creates high reward] can buy shares, and those who want low risk [because say they are retiring and don't have a risk appetite anymore] can sell shares." }, { "docid": "201226", "title": "", "text": "\"All discount brokers offer a commission structure that is based on the average kind of order that their target audience will make. Different brokers advertise to different target audiences. They could all have a lot lower commissions than they do. The maximum commission price for the order ticket is set at $99 by the industry securities regulators. When discount brokers came along and started offering $2 - $9.99 trades, it was simply because these new companies could be competitive in a place where incumbents were overcharging. The same exists with Robinhood. The market landscape and costs have changed over the last decade with regulation NMS, and other brokerage firms never needed to update drastically because they could continue making a lot on commissions with nobody questioning it. The conclusion being that other brokers can also charge a lot less, despite their other overhead costs. Robinhood, like other brokerage firms (and anyone else trading directly with the exchanges), are paid by the exchanges for adding liquidity. Not only are many trades placed with no commission for the broker, they actually earn money for placing the trade. If Robinhood was doing you any favors, they would be paying you. But nobody questions free commissions so they don't. Robinhood, like other brokerage firms, sells your trading data to the highest bidder. This is called \"\"payment for order flow\"\", these subscribers see your order on the internet in route to the exhange, and before your order gets to the exchange, the subscriber sends a different order to the exchange so they either get filled before you do (analogous to front running, but different enough to not be illegal) or they alter the price of the thing you wanted to buy or sell so that you have to get a worse price. These subscribers have faster computers and faster internet access than other market participants, so are able to do this so quickly. They are also burning a lot of venture capital like all startups. You shouldn't place too much faith in the idea they are making [enough] money. They also have plans to earn interest off of balances in a variety of ways and offer more options at a price (like margin accounts).\"" }, { "docid": "276466", "title": "", "text": "Dumb Coder has already given you a link to a website that explains your rights. The only thing that remains is how to execute the return without getting more grief from the dealer. Though the legal aspects are different, I believe the principle is the same. I had a case where I had to rescind the sale of a vehicle in the US. I was within my legal rights to do so, but I knew that when I returned to the dealership they would not be pleased with my decision. I executed my plan by writing a letter announcing my intention to return the vehicle siting the relevant laws involved with a space at the bottom of the letter for the sales person to acknowledge receipt of the letter and indicate that there was no visible damage to the car when the vehicle was returned. I printed two copies of the letter, one for them to keep, and one for me to keep with the signed acknowledgement of receipt. As expected, they asked me to meet with the finance manager who told me that I wouldn't be able to return the car. I thanked him for meeting with me and told him that I would be happy to meet in court if I didn't receive a check within 7 days. (That was his obligation under the local laws that applied.)" }, { "docid": "69495", "title": "", "text": "\"Here's what you do without, on the negative side, just for balance: A bill: When I last had comprehensive insurance, it cost something like 3-4% of the value of the car per annum. (Obviously ymmv enormously but I think that's somewhere near the middle of the range and I'm not especially risky.) So, compared to the total depreciation and running costs of the car, it's actually fairly substantial. Over the say 10 years I might keep that car, it adds up to a fair slice of what it will take to buy a replacement. Financial crisis costs: I don't know about you, but my insurance went up something like 30% in recent years, despite the value-insured and the risk going down, said by the insurer to be due to market turmoil. So, at least hundreds of dollars is just kind of frictional loss, and I'd rather not pay it. Wrangling with the insurer: if you have insurance and a loss, you have to persuade them to pay out, perhaps document the original conditions or the fault, perhaps argue about whether their payment is fair. I've done this for small (non-automotive) claims, and it added up to more hassle than the incident itself. Obviously all insurers will claim they're friendly to deal with but until you actually have a big claim you never know. Moral hazard: I know I'm solely responsible for not having my car crashed or stolen. Somehow that just feels better. Free riders: I've seen people \"\"fudge\"\" their insurance claims so that things that shouldn't have been covered were claimed to be. You might have too. Buy insurance and you're paying for them. Choice: Insurers are typically going to make the decision for you about whether a claim is repairable or not, and in my experience are reluctant or refuse to just give you the cash amount of the claim. (See also, moral hazard.) Do it yourself and you can choose whether to live with it, make a smaller or larger repair, or replace the whole vehicle with a second hand one or a brand new one, or indeed perhaps do without a vehicle. A distraction: Hopefully by the time you've been working for a while, a vehicle is not a really large fraction of your net worth. If you lose 10% of your net worth it's not really nice but - well, you could easily have lost that off the value of your house or your retirement portfolio in recent years. What you actually need to insure is genuinely serious risks that would seriously change your life if they were lost, such as your ability to work. For about the same cost as insuring a $x car, you can insure against $x income every year for the rest of your life, and I think it's far more important. If I have a write-off accident but walk away I'll be perfectly happy. And, obviously, liability insurance is important, because being hit for $millions of liabilities could also have a serious impact. Coverage for mechanical failures: If your 8yo car needs a new transmission, insurance isn't going to help, yet it may cost more than the typical minor collision. Save the money yourself and you can manage those costs out of the same bucket. Flexibility: If you save up to replace your car, but some other crisis occurs, you can choose to put the money towards that. If you have car insurance but you have a family medical thing it's no help. I think the bottom line is: insure against costs you couldn't cope with by yourself. There are people who need a car but can just barely afford it, but if you're fortunate enough not to be in that case you don't really need comprehensive insurance.\"" }, { "docid": "261673", "title": "", "text": "\"Unfortunately, it's not unusual enough. If you're looking for a popular car and the dealer wants to make sure they aren't holding onto inventory without a guarantee for sale, then it's a not completely unreasonable request. You'll want to make sure that the deposit is on credit card, not cash or check, so you can dispute if an issue arises. Really though, most dealers don't do this, requiring a deposit, pre sale is usually one of those hardball negotiating tactics where the dealer wrangles you into a deal, even if they don't have a good deal to make. Dealers may tell you that you can't get your deposit back, even if they don't have the car you agreed on or the deal they agreed to. You do have a right for your deposit back if you haven't completed the transaction, but it can be difficult if they don't want to give you your money back. The dealer doesn't ever \"\"not know if they have that specific vehicle in stock\"\". The dealer keeps comprehensive searchable records for every vehicle, it's good for sales and it's required for tax records. Even when they didn't use computers for all this, the entire inventory is a log book or phone call away. In my opinion, I would never exchange anything with the dealer without a car actually attached to the deal. I'd put down a deposit on a car transfer if I were handed a VIN and verified that it had all the exact options that we agreed upon, and even then I'd be very cautious about the condition.\"" }, { "docid": "312090", "title": "", "text": "You could have the buyer go to the bank with you so that he can get evidence that the loan will be paid in full and that the lien will be lifted. The bank won't sign over the title (and lift the lien) until the loan is paid back in full. DMV.org has a pretty good section about this. (Note: not affiliated with the actual DMV) Selling to a Private Party Though more effort will be required on your part, selling a car with a lien privately could net you a higher profit. Here are a few things you'll need to consider to make the process easier: Include the details of the lien in your listing. You'll list an advertisement for your car just as you would any other vehicle, with the addition of the lien information that buyers will need so as to avoid confusion. Sell in the location of the lienholder, if possible. If the bank or financial institution holding the lien is located in the area you're trying to sell, this will make the transaction much easier. Once you make an agreement with the buyer, you can go directly to the lender to pay off the existing lien. Ownership can then be transferred in person from the financial institution to the buyer. Consider an escrow service. If the financial institution isn't in your area, an escrow service can help to ensure a secure transaction. An escrow service will assume responsibility for receiving payments from the buyer and will hold the title until the purchase is complete. Advantages of an escrow service include: Payoff services, which will do most of the work with the financing institution for you. Title transfer services, which can help to ensure a safe and legitimate transaction and provide the necessary paperwork once the sale is complete." }, { "docid": "460054", "title": "", "text": "\"Seems to me you don't have a ton of great choices, but of them: Keep going as you are. If/when the car becomes unusable without significant expenses, stop using it. Buy another junker and use that to get by until your loan is paid off. From now until then, put aside a few hundred (or whatever you can, if more) each month towards the anticipated purchase. When you do buy this junker, pay in cash - no loan. Just get something that will take you to work, and that includes \"\"bike\"\" if that's a possibility. When you can, sell the no longer usable car to finish paying off the loan. Start aggressively paying off the current loan, with the eye of getting it down to where you're not underwater anymore. Then sell the car and dispose of the loan, and buy a better replacement. Scrimp and save and cut everything - eat cheaply (and never out), cut your personal expenses everywhere you can. If you get another $250 a month towards principal, you can probably be no-longer-underwater in about a year. Get a personal loan today for the amount that you're underwater, and immediately sell the car. This gets you out of the loan and car the quickest, and if you think the car will devalue significantly between now and when you might be not underwater anymore, this might be the best option. But it's the most expensive, likely - you'll pay 12% to 20% on the difference. Now, 12% of $5000 is less than 5% of 15000, so it might actually be a good financial deal - but you'll probably have to shop around to get 12-15% with a 660 (though it's probably possible). You'll still be without a car at this point, though, so you'd have to buy another one (or live without for a while), and you'd still have a payment of some sort, but perhaps a more manageable one ($5000 @ 12% @ 5 years means something a bit over $100 a month, for example.) I recommend that if you can get by without a car for a while, option 2 is your best bet. All of these will require some financial care for a while, and probably cutting back on expenses for a year or two; but realistically, you shouldn't expect anything else. Get a budgeting app if it will help see how to do this. As far as getting out of the loan without paying it, I don't recommend that at all. Your credit will be ruined for at least seven years, and 660 is not bad at all really, and then would take yet more years to recover. You will likely be sued for the balance plus collection costs, beyond repossession. The consequences would be far, far worse than just paying it off, and I mean that financially as well as ethically.\"" }, { "docid": "580624", "title": "", "text": "The bank won't let you because: Differences in required account features — Business accounts have different features (many of them legal features) that are required by businesses. For instances: Do you want to be able to deposit cheques that are written out to your business name? You need a business account for that. Your business could be sold. Then it wouldn't be your business, so it wouldn't make sense to put the business account under your personal name. The bank account and the cash it holds is a business asset and should be owned by the business, so when the business is sold the account goes with it. This is especially the case for a corporation that has shareholders, and not a sole proprietorship. For a business, you could also, in theory, assign other people as signing authorities on the business account (e.g. your corporate treasurer), and the individuals performing that role could change over time. Business accounts allow for this kind of use. Market segmentation — The bank has consciously undertaken to segment their product offerings in order to maximize their profit. Market segmentation helps the bottom line. Even if there were zero legal reasons to have separate personal vs. business accounts, banks would still make it their policy to sell different account types according to use because they can make more money that way. Consider an example in another industry: The plain-old telephone company also practices segmentation w.r.t. personal/business. Do you want a telephone line for a business and listed as such in the phone book? You need a business line. Do you want a phone line hooked up at a non-residential address? You need a business line. Here it's clear it is less of a legal issue than with the bank account, and it doesn't matter that the technical features of the phone line may be identical for the basic product offerings within each segment. The phone company has chosen to segment and price their product offerings this way. Q. Why do companies choose to charge some kinds of customers more than others for essentially the same underlying service? A. Because they can." }, { "docid": "279782", "title": "", "text": "\"Usually insiders are in a better position than you to understand their business, but that doesn't mean they will know the future with perfect accuracy. Sometimes they are wrong, sometimes life events force them to liquidate an otherwise promising investment, sometimes their minds change. So while it is indeed valuable information, as everything in fundamental analysis it must be taken with a grain of salt. Automatic Sell I think these refer to how the sell occurred. Often the employees don't get actual shares but options or warrants that can be converted to shares. Or there may be special predetermined arrangements regarding when and how the shares may be traded. Since the decision to sell here has nothing to do with the prospects of the business, but has to do with the personal situation of the employee, it's not quite the same as outright selling due to market concerns. Some people, for instance, are not interested in holding stock. Part of their compensation is given in stock, so they immediately sell the stock to avoid the headache of watching an investment. This obviously doesn't indicate that they expect the company will go south. I think automatic sell refers to these sorts of situations, but your broker should provide a more detailed definition. Disposition (Non Open Market) These days people trade through a broker, but there's nothing stopping you from taking the physical shares and giving them to someone in exchange for say a stack of cash. With a broker, you only \"\"sell\"\" without considering who is buying. The broker then finds buyers for you according to their own system. If selling without a broker you can also be choosy with who is buying, and it's not like anybody can just call up the CEO and ask to buy some stock, so it's a non-open market. Ultimately though it's still the insider selling. Just on a different exchange. So I would treat this as any insider sell - if they are selling, they may be expecting the stock to become less valuable. indirect ownership I think this refers to owning an entity that in turn owns the asset. For instance CEO of XYZ owns stock in ACME, but ACME holds shares of XYZ. This is a somewhat complicated situation, it comes down to whether you think they sold ACME because of the exposure to XYZ or because of some other risk that applies only to ACME and not XYZ. Generally speaking, I don't think you would find a rule like \"\"if insider transactions of so and so kinds > X then buy\"\" that provides guaranteed success. If such a rule was possible it would have been exploited already by the professionals. The more sensible option is to consider all data available to you and try to make a holistic evaluation. All of these insider activities can be bullish or bearish depending on many other factors.\"" }, { "docid": "226197", "title": "", "text": "\"The answer is partly and sometimes, but you cannot know when or how. Most clearly, you do not take somebody else's money if you buy shares in a start-up company. You are putting your money at risk in exchange for a share in the rewards. Later, if the company thrives, you can sell your shares for whatever somebody else will pay for your current share in the thriving company's earnings. Or, you lose your money, when the company fails. (Much of it has then ended up in the company's employees' pockets, much of the rest with the government as taxes that the company paid). If the stockmarket did not exist, people would be far less willing to put their money into a new company, because selling shares would be far harder. This in turn would mean that fewer new things were tried out, and less progress would be made. Communists insist that central state planning would make better decisions than random people linked by a market. I suggest that the historical record proves otherwise. Historically, limited liability companies came first, then dividing them up into larger numbers of \"\"bearer\"\" shares, and finally creating markets where such shares were traded. On the other hand if you trade in the short or medium term, you are betting that your opinion that XYZ shares are undervalued against other investors who think otherwise. But there again, you may be buying from a person who has some other reason for selling. Maybe he just needs some cash for a new car or his child's marriage, and will buy back into XYZ once he has earned some more money. You can't tell who you are buying from, and the seller can only tell if his decision to sell was good with the benefit of a good few years of hindsight. I bought shares hand over fist immediately after the Brexit vote. I was putting my money where my vote went, and I've now made a decent profit. I don't feel that I harmed the people who sold out in expectation of the UK economy cratering. They got the peace of mind of cash (which they might then reinvest in Euro stocks or gold or whatever). Time will tell whether my selling out of these purchases more recently was a good decision (short term, not my best, but a profit is a profit ...) I never trade using borrowed money and I'm not sure whether city institutions should be allowed to do so (or more reasonably, to what extent this should be allowed). In a certain size and shortness of holding time, they cease to contribute to an orderly market and become a destabilizing force. This showed up in the financial crisis when certain banks were \"\"too big to fail\"\" and had to be bailed out at the taxpayer's expense. \"\"Heads we win, tails you lose\"\", rather than trading with us small guys as equals! Likewise it's hard to see any justification for high-frequency trading, where stocks are held for mere milliseconds, and the speed of light between the trader's and the market's computers is significant.\"" }, { "docid": "213393", "title": "", "text": "\"Electric does make a difference when considering whether to lease or buy. The make/model is something to consider. The state you live in also makes a difference. If you are purchasing a small electric compliance car (like the Fiat 500e), leasing is almost always a better deal. These cars are often only available in certain states (California and Oregon), and the lease deals available are very enticing. For example, the Fiat 500e is often available at well under $100/mo in a three-year lease with $0 down, while purchasing it would cost far more ($30k, minus credits/rebates = $20k), even when considering the residual value. If you want to own a Tesla Model S, I recommend purchasing a used car -- the market is somewhat flooded with used Teslas because some owners like to upgrade to the latest and greatest features and take a pretty big loss on their \"\"old\"\" Tesla. You can save a lot of money on a pre-owned Model S with relatively low miles, and the battery packs have been holding up well. If you have your heart set on a new Model S, I would treat it like any other vehicle and do the comparison of lease vs buy. One thing to keep in mind that buying a Model S before the end of 2016 will grandfather you into the free supercharging for life, which makes the car more valuable in the future. Right now (2016/2017) there is a $7500 federal tax credit when buying an electric vehicle. If you lease, the leasing company gets the credit, not you. The cost of the lease should indirectly reflect this credit, however. Some states have additional incentives. California has a $2500 rebate, for example, that you can receive even if you lease the vehicle. To summarize: a small compliance car often has very good reasons to lease. An expensive luxury car like the Tesla can be looked at like any other lease vs buy decision, and buying a used Model S may save the most money.\"" } ]

[ { "docid": "92144", "title": "", "text": "Every reward program has to have a funding source. If the card gives you x percent back on all purchases. That means that their business is structured to entice you to pump more transactions through the system. Either their other costs are lower, or the increased business allows them to make more money off of late fees, and interest. If the card has you earn extra points for buying a type of item or from a type of store (home stores improvement in the Spring), they are trying to make sure you use their card for what can be a significant amount of business during a small window of time. Sometimes they cap it by saying 5% cash back at home improvement stores during the spring but only on the first $1500 of purchases. That limits it to $75 maximum. Adding more business for them, makes more money for them. Groceries and gas are a good year round purchase categories. Yes there is some variation depending on the season, and the weather, but overall there is not an annual cliff once the season ends. Gas and groceries account for thousands of dollars a year these are not insignificant categories, for many families are recession proof. If they perceive a value from this type of offer they will change their buying behavior. My local grocery store has a deal with a specific gas station. This means that they made a monetary deal. Because you earn points at the grocery store and spend points at the gas station, the grocery store is paying some compensation to the gas station every time you use points. The gas station must be seeing an increase in business so theoretically they don't get 100% compensation from the grocery store. In cases where credit cards give airline miles, the credit card company buys the miles from the airline at a discount because they know that a significant number of miles will never be used." } ]

[ { "docid": "22412", "title": "", "text": "That transaction probably cost the merchant $0.50 + 3% or close to $5. They should have refunded your credit card so they could have recouped some of the fees. (I imagine that's why big-box retailers like Home Depot always prefer to put it back on your card than give you store credit) Consider yourself lucky you made out with $0.15 this time. (Had they refunded your card, the 1% of $150 credit would have gone against next month's reward) Once upon a time folks were buying money from the US Mint by the tens of thousands $ range and receiving credit card rewards, then depositing the money to pay it off.. They figured that out and put a stop to it." }, { "docid": "525129", "title": "", "text": "\"Note: this answer is true for the UK, other places may vary. There are a couple of uses for credit cards. The first is to use them in a revolving manner, if you pay off the bill in full every time you get one then with the vast majority of cards you will pay no interest, effecitvely delay your expenses by a month, build your credit rating and with many credit cards you can also get rewards. Generally you should wait until the bill comes to pay it off. This ensures that your usage is reported to the credit ratings agencies. In general you should not draw out cash on credit cards as there is usually a fee and unlike purchases it will start acruing interest immediately. The second is longer term borrowing. This is where you have to be careful. Firstly the \"\"standard\"\" rate on most credit cards is arround 20% APR which is pretty high. Secondly on many cards once you are carrying a balance any purchases start acruing interest immediately. However many credit cards offer promotional rates. In contrast to the standard rates which are an expensive way to borrow the promotional rates often allow you to borrow at 0% APR for some period. Usually when it comes to promotional rates you get the best deal by opening a new credit card and using it immediately. Ideally you should plan to pay off the card before the 0% period ends, if you can't do that then a balance transfer may be an option but be aware than in a few years the market for credit cards may (or may not) have changed. Whatever you do you should ALWAYS make sure to pay at least the minimum payment and do so on time. Not doing so may trigger steep fees, loss of promotional interest rates. There is a site called moneysavingexpert that tracks the best deals.\"" }, { "docid": "568376", "title": "", "text": "I especially like buying them at my grocery market when they do the deals where every $25 in gift cards you buy, you get 10 cents off of gas. Buying a new $1500 camcorder? First buy the gift cards, and then get about 60 gallons of gas for free." }, { "docid": "452486", "title": "", "text": "when they make the most money off of charging interest on late payments? This is incorrect. Do you have any data to back this? In the past decade there was a tendency by financial institutions to make money from late payments and there were certain rewards / incentives for people who paid late. However the bubble cracked soon enough and there were huge losses in the card industry. Today most of the revenue for card companies is from margins on customers who pay on time and growth avenues are promoting to pay every transaction by card. why do they actively seek people who pay their bills on time (as evidence by requiring good credit scores to get approved for a card), instead of they opposite? As indicated above. Remember if one customer defaults it wipes out margins made by tons of customers. In spite of giving credit to people with good credit score, the average credit card debit an US individual holds is still quite high." }, { "docid": "361741", "title": "", "text": "\"There are many paths to success, but they all begin with education. You made the first big step just by visiting here. We have 17,000 questions, arranged by tag so you can view those on a given topic. You can sort by votes to see the ones that have the best member acceptance. I'll agree with Ben that one of the best ones is \"\"The correct order of investing.\"\" We both offered answers there, and that helps address a big chunk of your issue. The book recommendations are fine, you'll quickly find that each author has his/her own slant or focus on a certain approach. For example, one financial celebrity (note - in the US, there are private advisors, usually with credentials of some sort, there are those who work for brokers and also offers help, there are financial bloggers (I am one), and there are those who are on the radio or TV who may or may not have any credentials) suggests that credit cards are to be avoided. The line in another answer here, \"\"You're not going to get rich earning 1% on a credit card,\"\" is a direct quote of one such celebrity. I disputed that in my post \"\"I got rich on credit card points!\"\" The article is nearly 2 years old, the account accumulating the rewards has recently passed $34,000. This sum of money is more wealth than 81% of people in the world have. The article was a bit tongue in cheek (sarcastic) but it made a point. A young person should get a credit card, a good one, with no fee, and generous rewards. Use the card to buy only what you can pay back that month. At year end, I can download all my spending. The use of the card helps, not hinders, the budgeting process, and provides a bit of safety with its guarantees and theft protection. Your question really has multiple facets. If these answers aren't helpful enough, I suggest you ask a new question, but focus on one narrow issue. \"\"Paying off debt\"\" \"\"Getting organized\"\" \"\"Saving\"\" \"\"Budgeting\"\" all seem to be part of your one question here.\"" }, { "docid": "438284", "title": "", "text": "First: great job on getting it together. This is good for your family in any respect I can think of. This is a life long process and skill, but it will pay off for you and yours if you work on it. Your problem is that you don't seem to know where you money goes. You can't decide how whacky your expenses are until you know what they are. Looking at just your committed expenses and ignore the other stuff might be the problem here. You state that you feel you live modestly, but you need to be able to measure it completely to decide. I would suggest an online tool like mint.com (if you can get it in your country) because it will go back for 90 days and get transactions for you. If you primarily work in cash, this isn't helpful, but based on your credit card debt I am hoping not. (Although, a cash lifestyle would be good if you tend to overspend.) Take the time and sort your transactions into categories. Don't setup a budget, just sort them out. I like to limit the number of categories for clarity sake, especially to start. Don't get too crazy, and don't get too detailed at first. If you buy a magazine at the grocery store, just call it groceries. Once you know what you spend, then you can setup a budget for the categories. If somethings are important, create new categories. If one category is a problem, then break it down and find the specific issue. The key is that you budget not be more than you earn but also representative of what you spend. Follow up with mint every other day or every weekend so the categorization is a quick and easy process. Put it on your iPhone and do it at every lunch break. Share the information with your spouse and talk about it often." }, { "docid": "485102", "title": "", "text": "\"Yes. The simplest option to track your spending over time is to familiarize yourself with the \"\"Reports\"\" menu on the toolbar. Take a look specifically at the \"\"Reports > Income/Expense > Income Statement\"\" report, which will sum up your income and spending over a time frame (defaults to the current year). In each report that you run, there is an \"\"Options\"\" button at the top of the screen. Open that and look on the \"\"General\"\" tab, you'll be able to set the time frame that the report displays (if you wanted to set it for the 2 week block since your last paycheck, for example). Other features you're going to want to familiarize yourself with are the Expense charts & statements, the \"\"Cash Flow\"\" report, and the \"\"Budgeting\"\" interface (which is relatively new), although there is a bit of a learning curve to using this last feature. Most of the good ideas when it comes to tracking your spending are independent of the software you're using, but can be augmented with a good financial tracking program. For example, in our household we have multiple credit cards which we pay in full every month. We selected our cards on specific benefits that they provide, such as one card which has a rotating category for cash back at certain business types. We keep that card set on restaurants and put all of our \"\"eating out\"\" expenses on that card. We have other cards for groceries, gas, etc. This makes it easy to see how much we've spent in a given category, and correlates well with the account structure in gnucash.\"" }, { "docid": "592670", "title": "", "text": "No. Credit scores are primarily built by doing the following: To build credit, get a few major credit cards and a couple of store cards. Use one of them to make routine purchases like gas and groceries. Pay them on time every month. You're good to go. I would hate to sell stocks to pay off a loan -- try finding a better loan. If you financed through the dealer, try joining a credit union and see if you can get a better rate." }, { "docid": "20261", "title": "", "text": "\"A \"\"balance transfer\"\" is paying one credit card with another. You probably get offers in the mail to do this all of the time. As other posters have noted, however, this usually comes with finance fees rather than the rewards that you get for normal purchases because it's written into your credit card agreement as a different class of transaction with different rules. I'm not sure if it's urban legend or true, but I have heard stories that suggest there were some \"\"loop holes\"\" in the earliest credit card reward plans that allowed for something like what you want. I doubt that any plan ever allowed exactly what you've written, but I've heard stories about people buying gift cards from merchants and then using the gift cards to pay their bill. This loop hole (if it ever existed) is closed now, but it would have allowed for essentially infinite generation of rewards at no cost to the cardholder. The banks and credit card companies have a lot of years of experience at this sort of thing now, so the threshold for you finding something that works and conforms with the cardholder agreement is pretty small.\"" }, { "docid": "88942", "title": "", "text": "\"It makes no sense to spend money unnecessarily, just for the purpose of improving your credit score. You have to stop and ask yourself the question \"\"Why do I need a good credit score?\"\" Most of the time, the answer will be \"\"so I can get a lower interest rate on (ABC loan) in the future.\"\" However, if you spend hundreds or even thousands of dollars in the present, just so that you can save a few points on a loan, you're not going to come out ahead. The car question should be considered strictly in the context of transportation expenses: \"\"It cost me $X to get around last year using Lyft. If instead I owned a car, it would have cost me $Y for gas, insurance, depreciation, parking, etc.\"\" If you come out ahead and Y < X, then buy the car. Don't jump into an expensive vehicle (which is never a good investment) or get trapped into an expensive lease which will costs you many times more than the depreciation value of a decent used car, just so that you can save a few points on a mortgage. Your best option moving forward would be to pay off your student loans first, getting rid of that interest expense. Place the remainder in savings, then start to look at a budget. Setting aside a 20% down payment on a home is considered the minimum to many people, and if that is out of reach you might need to consider other neighborhoods (less than 400K!). If you're still concerned about your credit score, a good way to build that up (once you have a budget and spending under control) is to get a credit card with no annual fees. Start putting all of your expenses on the credit card (groceries, etc), and paying off the balance IN FULL every month. By spending only what you need to within a reasonable budget, and making payments on time and in full, your credit rating will begin to gradually improve. If you have a difficult time tracking your expenses or sticking to a budget, then there is potential for danger here, as credit cards are notorious for high interest and penalties. But by keeping it under control and putting the rest toward savings, you can begin to build wealth and put yourself in a much better financial position moving into the future.\"" }, { "docid": "450830", "title": "", "text": "\"The bottom line is that you are kind of a terrible customer for them. Granted you are far better than one that does not pay his bills, but you are (probably) in the tier right above that. Rewards cards are used to lure the unorganized into out of control interest rates and late payments. These people are Capital One's, and others, best customers. They have traded hundreds of dollars in interest payments for a couple of dollars in rewards. The CC company says: \"\"YUMMY\"\"! You, on the other hand, cut into their \"\"meager\"\" profits from fees collected from your transactions. Why should they help you make more money? Why should they further cut into your profits? Response to comment: Given your comment I think the bottom line is a matter of perspective. You seem like a logical, altruistic type person who probably seeks a win-win situation in business dealings. This differs from CC companies they operate to seek one thing: enslavement. BTW the \"\"terrible customer\"\" remark should be taken as a compliment. After you get past the marketing lies you begin to see what reward programs and zero percent financing is all about. How do most people end up with 21%+ interest rates? They started with a zero percent balance loan, and was late for a payment. Reward cards work a bit differently. Studies show that people tend to spend about 17% more when they use a reward card. I've caught myself ordering an extra appetizer or beer and have subsequently stopped using a reward card for things I can make a decision at the time of purchase. For people with tight budgets this leads to debt. My \"\"meager\"\" profits paragraph makes sense when you understand the onerous nature of CC companies. They are not interested in earning 2% on purchases (charge 3% and give back 1%) for basically free money. You rightly see this as what should be a win-win for all parties involved. Thus the meager in quotation marks. CC companies are willing to give back 1% and charge 3% if you then pay 15% or more on your balance. Some may disagree with me on the extracting nature of CC companies, but they are wrong. I like him as an actor, but I don't believe Samuel Jackson's lines.\"" }, { "docid": "584187", "title": "", "text": "The amount you are earning in the savings account is insignificant, since you would only have the money in the account for 1 month after purchasing the car. The instant 1.5% cashback (or travel mile reward), on the other hand, can be significant. However, it is not normal for a car dealership to allow you to put $16k on a credit card. The reason is that the fees that the dealer has to pay to process your credit card would be too burdensome. Car dealers have a much smaller profit margin on their sales than a typical retail store, so if the dealer has to pay 3 or 4% of the sales price in credit card fees, it just eats up too much of their profit. If the dealer does allow you to put the entire purchase price on a credit card, be aware that they have already factored in their processing fees into the price. You might be able to get a better than 1.5% discount by offering to pay with cash instead." }, { "docid": "226831", "title": "", "text": "The answer for this question varies from person to person. However most cards give lousy rewards percentage-wise. Take a look at where your money is being spent each month (say with a tool like mint.com), and seek out a card that rewards you in categories where you already spend a lot of money. Many people here have suggested cards with high gas rebates, and that's great if you drive more than anything else. However, the important thing is to pick what benefits you most." }, { "docid": "245447", "title": "", "text": "\"For simplicity, let's start by just considering cash back. In general, cash back from credit cards for personal use is not taxable, but for business use it is taxable (sort of, I'll explain later). The reason is most personal purchases are made with after tax dollars; you typically aren't deducting the cost of what you purchased from your personal income, so if you purchase something that costs $100 and you receive $2 back from the CC company, effectively you have paid $98 for that item but that wouldn't affect your tax bill. However, since businesses typically deduct most expenses, that same $100 deduction would have only been a $98 deduction for business tax purposes, so in this case the $2 should be accounted for. Note, you should not consider that $2 as income though; that would artificially inflate your revenue. It should be treated as a negative expense, similar to how you would handle returning an item you purchased and receiving a CC refund. Now for your specific questions: Part 1: As a small business owner, I wish to attend an annual seminar to improve my business. I have enough credit card reward points to cover the airfare, hotel, and rental car. Will those expenses still be deductible at the value displayed on the receipt? Effectively no, these expenses are not deductible. If you deduct them they will be completely counter-acted by the \"\"refund\"\" you receive for the payments. Part 2: Does it matter if those points are accrued on my personal credit card, rather than a business credit card? This is where it gets hairy. Suppose your company policy is that employees make purchases with their own personal credit cards and submit receipts for reimbursement. In this case the employer can simply reimburse and would not know or care if the employee is racking up rewards/points/cashback. The trick is, as the employee, you must always purchase business related items normally so you have receipts to show, and if you receive cashback on the side there seems to be a \"\"don't ask, don't tell\"\" rule that the IRS is OK with. It works the same way with heavy business travelers and airline miles- the free vacations those users get as perks are not treated as taxable income. However, I would not go out of my way to abuse this \"\"loophole\"\". Typically, things like travel (airfare, hotel, car rental, meals) are expected. But I wouldn't go purchase 100 company laptops on your personal card and ask the company to reimburse you. The company should purchase those 100 laptops on a company card and effectively reduce the sale price by the cashback received. (Or more realistically, negotiate a better discount with your account rep and just cut them a check.) Part 3: Would there be any difference between credit card points and brand-loyalty points? If the rental car were paid for with points earned directly on the rental car company's loyalty system (not a CC), would that yield a different result? There is no difference. Perhaps the simplest way to think about this is you can only deduct an expense that you actually incur. In other words, the expense should show up on a bank or CC statement. This is why when you volunteer and work 10 hours for a charity, you can't call that a \"\"donation\"\" of any amount of money because there is no actual payment made that would show up on a bank statement. Instead you could have billed the charity for your 10 hours of work, and then turned around and donated that same amount back to them, but it ends up being a wash.\"" }, { "docid": "444543", "title": "", "text": "Debit cards can be riskier than credit cards. That's why I personally avoid debit cards unless I have a very good reason to go that direction (e.g. HSA accounts). To explain the risk, consider what happens if someone steals the card or number and starts using it: Credit card: You get a big bill, which you dispute and eventually get dismissed. Debit card: Your bank account balance drops, you don't have access to cash, and your checks start bouncing and you rack up bounced check charges with your bank and stores where you write checks. Eventually, you convince the bank it was fraud and they refund the money to your account. The big difference is that while it is going on you are out the money with a debit card, and with a credit card the BANK is out the money. The above scenario happened to my brother and it wasn't pretty. He was having to borrow money to pay his rent and groceries while the bank sorted it out." }, { "docid": "495751", "title": "", "text": "\"This might not be the answer you are looking for, but the alternative to \"\"don't patronize these merchants\"\" is this: DO patronize these merchants, and pay cash. Credit cards are convenient. (I use a credit card often.) However, there is no denying that they cost the merchants an incredible amount in fees, and that our entire economy is paying for these fees. The price of everything is more than it needs to be because of these fees. Yes, you get some money back with your rewards card, but the money you get back comes directly from the store you made the purchase with, and the reward is paid for by increasing the price of everything you buy. In addition, those among us that do not have the credit score necessary to obtain a rewards card are paying the same higher price for goods as the rest of us, but don't get the cash back reward. Honestly, it seems quite fair to me that only the people charging purchases to a credit card should have to pay the extra fee that goes along with that payment processing. If a store chooses to do that, I pay cash instead, and I am grateful for the discount.\"" }, { "docid": "61706", "title": "", "text": "Here's one reason that's being overlooked in answers so far. (@ChrisInEdmonton, this is for your comment on @Chad's answer.) How do credit card companies make money? Sure, there's interest charges, but those are offset significantly by the cost of borrowing money, and by people defaulting on their debt / entering bankruptcy. The other way they make money is by processing transactions. They get a cut of whatever you buy. If you're a high-income person, and you're going to process a lot of expenditures with this credit card, your business is worth more. They will be willing to bribe you with things like cash-back, frequent flier miles, and insurance on your auto rentals, so that they can be your #1 go-to card. (This works in concert with the way that some credit card vendors with richer clientele overall - American Express - get to charge higher merchant fees for access to these customers' wallets. But that was mentioned in other answers.) If you're not a high-income person, your business is worth less. If you go somewhere asking for credit, they're going to try and give you a card which will earn them the most money - which probably isn't the one where they give you back 50% of their transaction fee in rewards. It's a calculated risk, since they still have to compete against cash, debit cards, and all the other credit card companies, so they don't have you totally over a barrel, but you shouldn't expect as many freebies, either." }, { "docid": "386668", "title": "", "text": "These are the things to focus on... do not put yourself in debt with a car, there are other better solutions. 1) Get a credit card (Unless you already have one) -Research this and get the best cash back or points card you can get at the best rate. - Start with buying gas and groceries every month do not run the balance up. - Pay the card off every single month. (THIS IS IMPORTANT) - Never carry a balance above 25% of your credit limit. - Every 8 months or so call your credit card company and ask for a credit line increase. They should be able to do this WITHOUT pulling your credit you are only looking for the automatic increment that they can automatically approve. This will help increase your available credit and will help keep your credit utilization low. Only do this is you are successfully doing the other bullet points above. 2) Pay all of your bills on time, this includes everything from water, electricity, phone bill, etc. never be late. Setup automatic payments if you can. 3) Minimize the number of hard credit inquiries. -This is particularly important when you are looking for your mortgage lender. Do not let them pull your credit automatically. You should be able to provide them your credit score and other information and get quotes from those lenders. Do not let them tell you then can't do this... they can. 4)Strategically plan when you close a credit line, closing them will do two things, lower your credit limit often times increasing your credit utilization, and it may hurt your average age of credit. Open one credit card and keep it forever. *Note: Credit Karma is a great tool, you should check your score monthly and see how your efforts are influencing your score. I also like Citi credit cards because they will provide you monthly with your FICO Score which Credit Karma will only provide TransUnion and Equifax. This is educational information and you should consider talking to a banker/lender who can also give you more detailed instructions on how to get your credit improved so that they can approve you for a loan. Many people can get their score above 720 in 1-2 years time going from no credit doing the steps described above. It does take time be patient and don't fall for gimmicks." }, { "docid": "291376", "title": "", "text": "\"What you are doing is neither one. You are simply watching to make sure you don't overdraw, which itself suggests you might be living hand to mouth and not saving. Keeping track of your money and budgeting are useful tools which help people get on top of their money. Which tends to have the effect of allowing you to save. How much did you spend on groceries last month? Eating out? Gas? If you were \"\"keeping track of your money\"\", you could say immediately what you spent, and whether that is above or below average, and why. How much do you plan to spend in the next 3 months on gas, groceries, eating out? If you knew the answer to that question, then you would have a \"\"budget\"\". And if those months go by, and your budget proves to have been accurate, or educates you as to what went wrong so you can learn and fix it... then your budget is a functioning document that is helping you master your money. Certainly the more powerful of the two is the \"\"keeping track\"\", or accounting of what has happened to you so far. It's important that you keep track of every penny without letting stuff \"\"slip through the cracks\"\". Here you can use proper accounting techniques and maybe accounting software, just like businesses do where they reconcile their accounting against their bank statements and wallet cash. I shortcut that a little. I buy gift cards for McDonalds, Panera, Starbucks, etc. and buy my meals with those. That way, I only have one transaction to log, $40 - McDonalds gift card instead of a dozen little meals. It works perfectly fine since I know all that money went to fast food. A little more dangerous is that I treat wallet cash the same way, logging say two monthly entries of $100 to cash rather than 50 little transactions of left $1 tip at restaurant. This only works because cash is a tiny part of my overall expenditures - not worth accounting. If it added up to a significant part, I'd want accounting on that.\"" } ]

[ { "docid": "355592", "title": "", "text": "\"There absolutely is a specific model that makes this so popular with so many credit card companies, and that model is \"\"per transaction fees\"\". Card companies also receive cost-sharing incentives from certain merchants. There is also a psychological reasoning as an additional incentive. When you want to accept credit cards as a source of payment as a business, you generally have three kinds of fees to pay: monthly/yearly subscription fees, percentage of transaction fee, and per transaction fee. The subscription fees can be waived and sometimes are expressed as a \"\"minimum cost\"\", so the business pays a certain amount whether you actually have people use credit cards or not. Many of these fees don't actually make it to the credit card companies, as they just pay the service providers and middle-men processing companies. The percentage of transaction fee means that the business accepting payment via credit card must pay a percentage usually ranging from 1-3% of the total transactions they accept. So if they get paid $10,000 a month by customers in the form of credit cards, the business pays out $100-300 a month to the credit card processor - a good portion of which will make it back to the credit card issuing company, and is a major source of income for them. The per transaction fee means that every time a transaction is run involving a card, a set fee is incurred by the business (which is commonly anywhere from $0.05 to $0.30 per transaction). If that $10,000 a month business mentioned previously had 10 customers paying $1,000 each at $0.10 a transaction, that's only $1 in fees to the credit card processors/companies. But if instead that business was a grocery store with an average transaction of $40, that's $25 in fees. This system means that if you are a credit card company and want to encourage people to make a specific kind of purchase, you should encourage purchases that people make many times for relatively small amounts of money. In a perfect world you'd want them to buy $1 bottles of water 5 times a day with their credit card. If the card company had 50,000 card holders doing this, at the end of 1 year the company would have $91,250,000 spread across 91,250,000 transactions. The card company might reasonably make $0.05 per transaction and %1 of the purchase total. The Get Rewarded For Drinking More campaign might earn the card company $912,500 in percentage fees and over $4.5 million in transaction fees. Yet the company would only have to pay 3% in rewards from the percentage fees, or $2.7 million, back to customers. If the card company had encouraged using your credit card for large once-yearly purchases, they would actually pay out more money in rewards than they collect in card-use fees. Yet by encouraging people to make small transactions very often the card company earns a nice net-income even if absolutely every customer pays their balance in full, on time, and pays no annual/monthly fees for their card - which obviously does not happen in the real world. No wonder companies try so hard to encourage you to use your card all the time! For card companies to make real money they need you to use your credit card. As discussed above, the more often you use the card the better (for them), and there can be a built-in preference for small repeated transactions. But no matter what the size of transaction, they can't make the big bucks if you don't use the card at all! Selling your personal information isn't as profitable if they don't have in-depth info on you to sell, either. So how do they get you to make that plastic sing? Gas and groceries are a habit. Most people buy one or the other at least once a weak, and a very large number of us make such purchases multiple times a week. Some people even make such purchases multiple times a day! So how do people pay for such transactions? The goal of the card companies is to have you use their product to pay as much as possible. If you pay for something regularly you'll keep that card in your wallet with you, rather than it getting lost in a drawer at home. So the card companies want you to use your card as a matter of habit, too. If you use a card to buy for gas and groceries, why wouldn't you use it for other things too? Lunch, dinner, buying online? If the card company pays out more and makes less for large, less-regular purchases, then the ideal for them is to have you use the card for small regular purchase and yet still have you use the card for larger infrequent purchases even if you get reduced/no rewards. What better way to achieve all these goals than to offer special rewards on gas and groceries? And because it's not a one-time purchase, you aren't so likely to game the system; no getting that special 5% cash-back card, booking your once-per-decade dream vacation, then paying it off and cancelling it soon after - which would actually make the card company lose money on the deal. In the end, credit card companies as a whole have a business model that almost universally prefers customers who use their products regularly and preferably for small amounts a maximum number of times. They want to reduce their expenses (like rewards paid out) while maximizing their revenue. They haven't figured out a better way to do all of this so well as to encourage people to use their cards for gas and groceries - everything else seems like a losing proposition in comparison. The only time this preference differs is when they can avoid paying some or all of the cost of rewards, such as when the merchants themselves honor the rewards in exchange for reduced or zero payment from the card companies. So if you use an airline card that seems to give you 10% back in airline rewards? Well, that's probably a great deal for the card company if the airline provides that reward at their own expense to try to boost business. The card company keeps the transaction-related fees and pays out almost nothing in rewards - the perfect offer (for them)! And this assumes no shenanigans like black-out periods, \"\"not valid with any other offers\"\" rewards like on cars where only a fool pays full MSRP (and sometimes the rewards are tagged in this sort of way, like not valid on sale/clearance items, etc), expiring rewards, the fact that they know not everyone uses their rewards, annual fees that are greater than the rewards you'll actually be obtaining after accounting for all the other issues, etc. And credit card industries are known for their shenanigans!\"" } ]

[ { "docid": "226831", "title": "", "text": "The answer for this question varies from person to person. However most cards give lousy rewards percentage-wise. Take a look at where your money is being spent each month (say with a tool like mint.com), and seek out a card that rewards you in categories where you already spend a lot of money. Many people here have suggested cards with high gas rebates, and that's great if you drive more than anything else. However, the important thing is to pick what benefits you most." }, { "docid": "253005", "title": "", "text": "\"Understand that buying a Starbucks gift card at the grocery store to receive 6% back on your coffee rather than 6% back on your groceries is an exploit of a flaw in the benefits program, not a feature. It's definitely not a blanket yes or no answer, the only way to find out is to try. Separately, I don't know why you would find this \"\"concerning.\"\" This will vary greatly between merchants and cards. There will always be new points churning exploits, they don't last forever and you can't expect every customer service rep to be well versed in methods employed to juice cardmember programs. Hell, a number of years ago one person figured out that he could buy rolls of $1 coins from the US treasury with free shipping and no additional fees. This guy was literally buying thousands of dollars of cash each month to deposit and pay his credit card bill; completely against the terms of the treasury program for distributing the $1 coins. A number of people had their cards and points/cash back revoked for that one.\"" }, { "docid": "88942", "title": "", "text": "\"It makes no sense to spend money unnecessarily, just for the purpose of improving your credit score. You have to stop and ask yourself the question \"\"Why do I need a good credit score?\"\" Most of the time, the answer will be \"\"so I can get a lower interest rate on (ABC loan) in the future.\"\" However, if you spend hundreds or even thousands of dollars in the present, just so that you can save a few points on a loan, you're not going to come out ahead. The car question should be considered strictly in the context of transportation expenses: \"\"It cost me $X to get around last year using Lyft. If instead I owned a car, it would have cost me $Y for gas, insurance, depreciation, parking, etc.\"\" If you come out ahead and Y < X, then buy the car. Don't jump into an expensive vehicle (which is never a good investment) or get trapped into an expensive lease which will costs you many times more than the depreciation value of a decent used car, just so that you can save a few points on a mortgage. Your best option moving forward would be to pay off your student loans first, getting rid of that interest expense. Place the remainder in savings, then start to look at a budget. Setting aside a 20% down payment on a home is considered the minimum to many people, and if that is out of reach you might need to consider other neighborhoods (less than 400K!). If you're still concerned about your credit score, a good way to build that up (once you have a budget and spending under control) is to get a credit card with no annual fees. Start putting all of your expenses on the credit card (groceries, etc), and paying off the balance IN FULL every month. By spending only what you need to within a reasonable budget, and making payments on time and in full, your credit rating will begin to gradually improve. If you have a difficult time tracking your expenses or sticking to a budget, then there is potential for danger here, as credit cards are notorious for high interest and penalties. But by keeping it under control and putting the rest toward savings, you can begin to build wealth and put yourself in a much better financial position moving into the future.\"" }, { "docid": "324411", "title": "", "text": "I only have anecdotal evidence here as members of my family used to own a grocery store / gas station, but they were often time charged much more to have the gasoline delivered to than many gas stations which were just a mile or two away (up to 15% more). Also depending upon the branding of the gas station, they are required to use certain distributors (i.e. if you are an Exxon gas station you can only use a few select vendors) which gave them less control of their final cost. All in all the gasoline often had smaller margins than items in the grocery store, which are already extremely low." }, { "docid": "495751", "title": "", "text": "\"This might not be the answer you are looking for, but the alternative to \"\"don't patronize these merchants\"\" is this: DO patronize these merchants, and pay cash. Credit cards are convenient. (I use a credit card often.) However, there is no denying that they cost the merchants an incredible amount in fees, and that our entire economy is paying for these fees. The price of everything is more than it needs to be because of these fees. Yes, you get some money back with your rewards card, but the money you get back comes directly from the store you made the purchase with, and the reward is paid for by increasing the price of everything you buy. In addition, those among us that do not have the credit score necessary to obtain a rewards card are paying the same higher price for goods as the rest of us, but don't get the cash back reward. Honestly, it seems quite fair to me that only the people charging purchases to a credit card should have to pay the extra fee that goes along with that payment processing. If a store chooses to do that, I pay cash instead, and I am grateful for the discount.\"" }, { "docid": "360628", "title": "", "text": "Determining how much you should budget to spend on any area of your budget is one of those hard topics to find good information about. Part of the problem is that everyone has different priorities and needs, and incomes and expenses vary greatly depending upon where you live and your career choices. The best thing you can do is track your spending for 1-3 months (you can use the envelope system if you need to, to track and control how much you spend on miscellaneous things like lunches, coffee, etc). The precision is important, though you probably dont need to measure to the penny, however you should capture all the areas where you spend money (even if you later gather them into more broad areas). Split your spending into three broad areas, and try to limit the spending for each of those areas to the stated percentages (adjust for your preferences). You state net Income $2600, and you stated you have $1731 of known expenses, so you are spending another $870 on groceries, debt payments, restaurants, unplanned expenses, and emergencies. Essentials (50%,$1300) - rent, transportation, food, utilites Total $972+groceries (you probably spend $400-600 on groceries, so your essentials are higher by $100-300 than you can afford. You should try to cut your electricity usage ($30-50), and you may be able to find cheaper car insurance (save $20). Financial Priorities (30%,$780) - savings, debt payments Total $376, nearly 15% before you pay for credit cards and savings. Please focus on paying off your debts (credit cards, window loan, student loans). You are spending almost 10% of your income on student loans, and you cannot afford much other debt. Lifestyle (20%,$520) Total $279, over 10% of your income on communications! Please try to cut cellphone, and DirectTV costs, at least until you have reduced debt. Since you have internet, your wife could use a voip provider (vonage, ooma telo, etc) or get an ipod touch and use skype or similar, at least until you get out of debt. You might consider trying to find a way to earn extra money, until you have paid off either the loan for windows, your credit card debt, or one of your student loans." }, { "docid": "562847", "title": "", "text": "\"The comments section to Dilip's reply is overflowing. First - the OP (Graphth) is correct in that credit scoring has become a game. A series of data points that predicts default probability, but of course, offers little chance to explain why you applied for 3 loans (all refinancing to save money on home or rentals) got new credit cards (to get better rewards) and have your average time with accounts drop like a rock (well, I canceled the old cards). The data doesn't dig that deep. To discuss the \"\"Spend More With Plastic?\"\" phenomenon - I have no skin in the game, I don't sell credit card services. So if the answer is yes, you spend more with cards, I'll accept that. Here's my issue - The studies are all contrived. Give college students $10 cash and $10 gift cards and send them into the cafeteria. Cute, but it produces no meaningful data. I can tell you that when I give my 13yr old $20 cash, it gets spent very wisely. A $20 Starbucks card, and she's treating friends and family to lattes. No study needed, the result is immediate and obvious. Any study worth looking at would first separate the population into two groups, those who pay in full each month and those who carry a balance. Then these two groups would need to be subdivided to study their behavior if they went all cash. Not a simply survey, and not cheap to get a study of the number of people you need for meaningful data. I've read quotes where The David claimed that card users spend 10% more than cash users. While I accept that Graphth's concern is valid, that he may spend more with cards than cash, there is no study (that I can find) which correlates to a percentage result as all studies appear to be contrived with small amounts to spend. As far as playing the game goes - I can charge gas, my cable bill, and a few other things whose dollar amounts can't change regardless. (Unless you're convinced I'll gas up and go joy-riding) Last - I'd love to see any link in the comments to a meaningful study. Quotes where conclusions are stated but no data or methodology don't add much to the discussion. Edit - Do You Spend More with Cash or Credit? is an article by a fellow Personal Finance Blogger. His conclusion is subjective of course, but along the same path that I'm on with this analysis.\"" }, { "docid": "181855", "title": "", "text": "\"Well, I answered a very similar question \"\"Credit card payment date\"\" where I showed that for a normal cycle, the average charge isn't due for 40 days. The range is 35-55, so if you want to feel good about the float just charge everything the day after the cycle closes, and nothing else the rest of the month. Why is this so interesting? It's no trick, and no secret. By the way, this isn't likely to be of any use when you're buying gas, groceries, or normal purchases. But, I suppose if you have a large purchase, say a big TV, $3000, this will buy you extra time to pay. It would be remiss of me to not clearly state that anyone who needs to take advantage of this \"\"trick\"\" is the same person who probably shouldn't use credit cards at all. Those who use cards are best served by charging what they can afford to pay at that moment and not base today's charges on what paychecks will come in by the due date of the credit card bill.\"" }, { "docid": "584187", "title": "", "text": "The amount you are earning in the savings account is insignificant, since you would only have the money in the account for 1 month after purchasing the car. The instant 1.5% cashback (or travel mile reward), on the other hand, can be significant. However, it is not normal for a car dealership to allow you to put $16k on a credit card. The reason is that the fees that the dealer has to pay to process your credit card would be too burdensome. Car dealers have a much smaller profit margin on their sales than a typical retail store, so if the dealer has to pay 3 or 4% of the sales price in credit card fees, it just eats up too much of their profit. If the dealer does allow you to put the entire purchase price on a credit card, be aware that they have already factored in their processing fees into the price. You might be able to get a better than 1.5% discount by offering to pay with cash instead." }, { "docid": "386668", "title": "", "text": "These are the things to focus on... do not put yourself in debt with a car, there are other better solutions. 1) Get a credit card (Unless you already have one) -Research this and get the best cash back or points card you can get at the best rate. - Start with buying gas and groceries every month do not run the balance up. - Pay the card off every single month. (THIS IS IMPORTANT) - Never carry a balance above 25% of your credit limit. - Every 8 months or so call your credit card company and ask for a credit line increase. They should be able to do this WITHOUT pulling your credit you are only looking for the automatic increment that they can automatically approve. This will help increase your available credit and will help keep your credit utilization low. Only do this is you are successfully doing the other bullet points above. 2) Pay all of your bills on time, this includes everything from water, electricity, phone bill, etc. never be late. Setup automatic payments if you can. 3) Minimize the number of hard credit inquiries. -This is particularly important when you are looking for your mortgage lender. Do not let them pull your credit automatically. You should be able to provide them your credit score and other information and get quotes from those lenders. Do not let them tell you then can't do this... they can. 4)Strategically plan when you close a credit line, closing them will do two things, lower your credit limit often times increasing your credit utilization, and it may hurt your average age of credit. Open one credit card and keep it forever. *Note: Credit Karma is a great tool, you should check your score monthly and see how your efforts are influencing your score. I also like Citi credit cards because they will provide you monthly with your FICO Score which Credit Karma will only provide TransUnion and Equifax. This is educational information and you should consider talking to a banker/lender who can also give you more detailed instructions on how to get your credit improved so that they can approve you for a loan. Many people can get their score above 720 in 1-2 years time going from no credit doing the steps described above. It does take time be patient and don't fall for gimmicks." }, { "docid": "319043", "title": "", "text": "One reason why some merchants in the US don't accept Discover is that the fee the store is charged is higher than the average. Generally a portion of transaction fee for the network and the issuing bank goes to the rewards program. In some cases a portion of the interest can also be used to fund these programs. Some cards will give you more points when you carry a balance from one month to the next. Therefore encouraging consumers to have interest charges. This portion of the program will be funded from the interest charges. Profits: Rewards: Some rewards are almost always redeemed: cash once the amount of charges gets above a minimum threshold. Some are almost never redeemed: miles with high requirements and tough blackout periods. Credit cards that don't understand how their customers will use their cards can run into problems. If they offer a great rewards program that encourages use, but pays too high a percentage of points earned can lead to problems. This is especially true when a great percentage of users pay in full each month. This hurt Citibank in the 1990's. They had a card with no annual fee forever, and a very high percentage never had to pay interest. People flocked to the card, and kept it as an emergency card, because they knew it would never have a annual fee." }, { "docid": "485102", "title": "", "text": "\"Yes. The simplest option to track your spending over time is to familiarize yourself with the \"\"Reports\"\" menu on the toolbar. Take a look specifically at the \"\"Reports > Income/Expense > Income Statement\"\" report, which will sum up your income and spending over a time frame (defaults to the current year). In each report that you run, there is an \"\"Options\"\" button at the top of the screen. Open that and look on the \"\"General\"\" tab, you'll be able to set the time frame that the report displays (if you wanted to set it for the 2 week block since your last paycheck, for example). Other features you're going to want to familiarize yourself with are the Expense charts & statements, the \"\"Cash Flow\"\" report, and the \"\"Budgeting\"\" interface (which is relatively new), although there is a bit of a learning curve to using this last feature. Most of the good ideas when it comes to tracking your spending are independent of the software you're using, but can be augmented with a good financial tracking program. For example, in our household we have multiple credit cards which we pay in full every month. We selected our cards on specific benefits that they provide, such as one card which has a rotating category for cash back at certain business types. We keep that card set on restaurants and put all of our \"\"eating out\"\" expenses on that card. We have other cards for groceries, gas, etc. This makes it easy to see how much we've spent in a given category, and correlates well with the account structure in gnucash.\"" }, { "docid": "264631", "title": "", "text": "\"Transferring the balance of a credit card is what they call moving your debt from one credit card to another credit card or loan. A debit card, however, is not debt. It is a card that is tied to a checking account with money in it. You can't transfer debt to your checking account. If you have enough money in your checking account to cover the balance of your credit card, you can pay it off. That is a really good thing to do, because the balance on your credit card is costing you a lot in interest charges each month. Were you perhaps thinking of \"\"transferring a balance\"\" from your debit card's checking account to a new credit card, where you would then have a new debt on the credit card, and extra cash in your debit card's checking account? This is possible with most credit cards, and is usually called a cash advance. However, just to caution you, cash advances typically have high interest rates. Often you will see promotions where they will offer low (or no) interest rate for a short time, but this is just a trick to entice you to borrow extra, knowing that if you need the money now, you'll most likely still need it in 6 months when the promotion expires. I don't recommend it.\"" }, { "docid": "302412", "title": "", "text": "\"You have a lack of credit history. Lending is still tight since the recession and companies aren't as willing to take a gamble on people with no history. The secured credit card is the most direct route to building credit right now. I don't think you're going to be applicable for a department store card (pointless anyways and encourages wasteful spending) nor the gas card. Gas cards are credit cards, funded through a bank just like any ordinary credit card, only you are limited to gas purchases at a particular retailer. Although gas cards, department store cards and other limited usage types of credit cards have less requirements, in this post-financial crisis economy, credit is still stringent and a \"\"no history\"\" file is too risky for banks to take on. Having multiple hard inquiries won't help either. You do have a full-time job that pays well so the $500 deposit shouldn't be a problem for the secured credit card. After 6 months you'll get it back anyways. Just remember to pay off in full every month. After 6 months you'll be upgraded to a regular credit card and you will have established credit history.\"" }, { "docid": "330049", "title": "", "text": "I am like you with not acknowledging balances in my accounts, so I pay my credit card early and often. Much more than once a month. With my banks bill pay, I can send money to the credit card for free and at any time. I pay it every two weeks (when I get paid), and I will put other extra payments on there if I bought a large item. It helps me keep my balances based in reality in Quicken. For example, I saved the cash for my trip, put the trip on my credit card, then paid it all off the day after I got home. I used the card because I didn't want to carry the cash, I wanted the rewards cash back, I wanted the automatic protection on the car rental, and I couldn't pay for a hotel with cash. There are many good reasons to use credit cards, but only if you can avoid carrying a balance." }, { "docid": "245447", "title": "", "text": "\"For simplicity, let's start by just considering cash back. In general, cash back from credit cards for personal use is not taxable, but for business use it is taxable (sort of, I'll explain later). The reason is most personal purchases are made with after tax dollars; you typically aren't deducting the cost of what you purchased from your personal income, so if you purchase something that costs $100 and you receive $2 back from the CC company, effectively you have paid $98 for that item but that wouldn't affect your tax bill. However, since businesses typically deduct most expenses, that same $100 deduction would have only been a $98 deduction for business tax purposes, so in this case the $2 should be accounted for. Note, you should not consider that $2 as income though; that would artificially inflate your revenue. It should be treated as a negative expense, similar to how you would handle returning an item you purchased and receiving a CC refund. Now for your specific questions: Part 1: As a small business owner, I wish to attend an annual seminar to improve my business. I have enough credit card reward points to cover the airfare, hotel, and rental car. Will those expenses still be deductible at the value displayed on the receipt? Effectively no, these expenses are not deductible. If you deduct them they will be completely counter-acted by the \"\"refund\"\" you receive for the payments. Part 2: Does it matter if those points are accrued on my personal credit card, rather than a business credit card? This is where it gets hairy. Suppose your company policy is that employees make purchases with their own personal credit cards and submit receipts for reimbursement. In this case the employer can simply reimburse and would not know or care if the employee is racking up rewards/points/cashback. The trick is, as the employee, you must always purchase business related items normally so you have receipts to show, and if you receive cashback on the side there seems to be a \"\"don't ask, don't tell\"\" rule that the IRS is OK with. It works the same way with heavy business travelers and airline miles- the free vacations those users get as perks are not treated as taxable income. However, I would not go out of my way to abuse this \"\"loophole\"\". Typically, things like travel (airfare, hotel, car rental, meals) are expected. But I wouldn't go purchase 100 company laptops on your personal card and ask the company to reimburse you. The company should purchase those 100 laptops on a company card and effectively reduce the sale price by the cashback received. (Or more realistically, negotiate a better discount with your account rep and just cut them a check.) Part 3: Would there be any difference between credit card points and brand-loyalty points? If the rental car were paid for with points earned directly on the rental car company's loyalty system (not a CC), would that yield a different result? There is no difference. Perhaps the simplest way to think about this is you can only deduct an expense that you actually incur. In other words, the expense should show up on a bank or CC statement. This is why when you volunteer and work 10 hours for a charity, you can't call that a \"\"donation\"\" of any amount of money because there is no actual payment made that would show up on a bank statement. Instead you could have billed the charity for your 10 hours of work, and then turned around and donated that same amount back to them, but it ends up being a wash.\"" }, { "docid": "335859", "title": "", "text": "As has been stated, you don't need to actively bank with a credit union to apply for one of their credit cards. That said, one benefit to having account activity, and significant capital with a CU, is to increase the likelihood of having a larger credit line granted to you, when you do apply. If you are going to use the card sparingly however, then this is a non issue. That said, if you really want to maximize card benefits, then you want to look for cards with large sign up bonuses (e.g. Chase Sapphire, or Ink Bold if you have a business) and sign up exclusively for those bonuses. These cards offer rewards in excessive value of $1000 in travel services (hotels/plane tickets), or $500 cash back if you prefer straight cash back redemptions. If you prefer to keep it really simple, you can sign up for a cash back card, like the Amex Fidelity, which offers 2% cash back everywhere, with no annual fee (albeit the cash back is through their investment account, which you don't actually have to 'invest' with). Personally, I have the Penfed card, and use it exclusively for gas (5% cash back). I also have a Charles Schwab bank account, which I keep funded exclusively for ATM withdrawals (free ATM usage, worldwide, 100% fee reimbursement). I use the accounts exclusively for the benefit they provide me, and no more and have never had an issue. I also have 3 dozen other credit cards which I signed up for exclusively for the sign up bonus, but that's outside the scope of this question. I only mention it because you seem to believe it is difficult to get approved for a new credit line. If your credit is good however, you won't have a problem. For a small idea, of how to maximize credit card bonus categories, I would advise you read this. As mentioned in the article, its possible to get rewards almost everywhere you shop. In short, anytime you use cash, you are missing out on a multitude of benefits a credit card offers you (e.g. see the benefits of a visa signature card) in addition to points/cash back." }, { "docid": "273528", "title": "", "text": "\"Unless you have a history of over-using credit (i.e. you've gotten yourself into debt trouble), then I think that the banker is giving you bad advice in telling you to get your own credit limit reduced. Having more credit available to you that is left unused will make your utilization ratio lower, which is generally better for your credit score, according to this article on CreditKarma.com. The \"\"sweet spot\"\" seems to be 1-20% utilization of your total credit. (But remember, this is only one factor in your credit score, and not even the biggest-- having a long history of on-time payments counts the most.) My own personal experience seems to bear this out. I have two major credit cards that I use. One card has a high credit limit (high for me anyway) and I use it for just about everything that I buy-- groceries, gas, durable goods, services, you name it. The other card has a limit that is about 1/3 of the first, and I use it for a few recurring bills and occasional purchases where they don't take the first card. I also have a couple of department store cards that I use rather infrequently (typically 1 purchase every 3 months or so). At the end of each month, when the respective statements post, each card has a balance that is 15% or less of the credit limit on that card. I pay off the entire balance on each card each month, and the cycle repeats. I have never been late on a payment, and my credit history for all of these cards goes back 10 years. My credit score is nearly as high as it can go. If having unused credit were a detriment, I would expect my score to be much lower. So, no, having \"\"too much credit available\"\" is not going to hurt you, unless you are not using it at all, or are tempted to abuse it (use too much). The key is to use common sense. Have a small number of cards, keep them active, spend within your means so you can pay off the balance in full after the statement posts, and never be late on your payments. That's all it takes to have good credit.\"" }, { "docid": "410728", "title": "", "text": "If you had a CC issuer that allowed you to do bill-pay this way, I suspect the payment would be considered a cash advance that will trigger a fee and a pretty egregious cash advance specific interest rate. It's not normal for a credit payment portal to accept a credit card as payment. If you were able to do this as a balance transfer, again there would be fees to transfer the balance and you would not earn any rewards from the transferred balance. I think it's important to note that cash back benefits are effectively paid by merchant fees. You make a $100 charge, the merchant pays about $2.50 in transaction fee, you're credited with about $1 of cash back (or points or whatever). Absent a merchant transaction and the associated fee there's no pot of money from which to apply cash back rewards." } ]

[ { "docid": "194955", "title": "", "text": "Do not mix personal accounts and corporate accounts. If you're paid as your self person - this money belongs to you, not the corporation. You can contribute it to the corporation, but it is another tax event and you should understand fully the consequences. Talk to a tax adviser (EA/CPA licensed in your State). If they pay to you personally (1099) - it goes on your Schedule C, and you pay SE taxes on it. If they pay to your corporation, the corporation will pay it to you as salary, and will pay payroll taxes on it. Generally, payroll through corporation will be slightly more expensive than regular schedule C. If you have employees/subcontractors, though, you may earn money which is not from your own performance, in which case S-Corp may be an advantage." } ]

[ { "docid": "11479", "title": "", "text": "Corporate trainer is an instructor, who works in a business environment and imparts the skills, ideas and ethics to groups of employees. Now-a-days corporate trainer plays an important role in corporate sector. Better corporate training can transform your life. For good corporate training, you need best corporate trainer, who can guide you in a perfect way, then take help of Mitesh Khatri – Corporate Trainer, Motivational Speaker &amp; Leadership Trainer. https://trainermiteshkhatri.wordpress.com/2017/06/30/corporate-trainer-3-super-easy-ways-to-select-the-best/" }, { "docid": "116684", "title": "", "text": "The easiest and cheapest way I can think of is the online bill pay service that most banks use. It's free for both of you; regardless of what the bank has to go through to get the payment to its destination, they generally eat the costs. You can use this to pay anyone from your rent to your electric company to your cousin Vinnie. However, I do not think that a business checking account has this feature. Instead, most corporate cash accounts typically have an ACH service attached to them, where for some small, fixed fee like 25 to 50 cents per transaction, they will accept transfer requests in an ACH format. This is how your electric company does auto-debit (if you let them), and how banks do online bill pay to most corporate payees; they, and their bank account numbers, would be verified by and kept on file with each bank that moved a substantial volume of money to this payee." }, { "docid": "75619", "title": "", "text": "\"This is the best tl;dr I could make, [original](http://www.epi.org/publication/corporations-pay-between-13-and-19-percent-in-federal-taxes-far-less-than-the-35-percent-statutory-tax-rate/) reduced by 81%. (I'm a bot) ***** &gt; Despite some recent claims to the contrary, a recent CBO report doesn&amp;#039;t overturn, but rather bolsters the research showing that corporations pay less than a 35 percent tax rate. &gt; Comparison of statutory U.S. corporate tax rate and three estimates of what corporations actually pay on average. &gt; Multiple studies with distinct methodologies have found effective federal corporate tax rates that range between 13 and 19 percent- far smaller than the rate corporations are supposed to pay. ***** [**Extended Summary**](http://np.reddit.com/r/autotldr/comments/6sx0c3/corporations_pay_between_13_and_19_percent_in/) | [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ \"\"Version 1.65, ~188170 tl;drs so far.\"\") | [Feedback](http://np.reddit.com/message/compose?to=%23autotldr \"\"PM's and comments are monitored, constructive feedback is welcome.\"\") | *Top* *keywords*: **Tax**^#1 **corporations**^#2 **loophole**^#3 **rate**^#4 **deferral**^#5\"" }, { "docid": "218438", "title": "", "text": "\"Economists actually hate the interest deduction, especially for mortgages. From The Economist: \"\"Allowing interest payments, but not dividends, to be deducted from corporate profits before tax is paid is a huge distortion to the system. It is a perk worth around 11% of the value of corporate assets. It has tended to encourage companies to take on more debt. By doing so, it may make the economy more risky at the margin: in a recession, highly-indebted companies are likely to go bust more quickly, whereas companies with lots of equity capital can ride out the storm. As a result, this newspaper has favoured the abolition of the deductibility rule.\"\" http://www.economist.com/news/finance-and-economics/21716050-would-be-risky-time-fiddle-tax-code-what-if-interest-expenses More from 538 https://fivethirtyeight.com/features/the-tax-deductions-economists-hate/\"" }, { "docid": "129503", "title": "", "text": "\"You're conflating LLC with Corporation. They're different animals. LLC does not have \"\"S\"\" or \"\"C\"\" designations, those are just for corporations. I think what you're thinking about is electing pass through status with the IRS. This is the easiest way to go. The company can pay you at irregular intervals in irregular amounts. The IRS doesn't care about these payments. The company will show profit or loss at the end of the year (those payments to you aren't expenses and don't reduce your profit). You report this on your schedule C and pay tax on that amount. (Your state tax authority will have its own rules about how this works.) Alternatively you can elect to have the LLC taxed as a corporation. I don't know of a good reason why someone in your situation would do this, but I'm not an accountant so there may be reasons out there. My recommendation is to get an accountant to prepare your taxes. At least once -- if your situation is the same next year you can use the previous year's forms to figure out what you need to fill in. The investment of a couple hundred dollars is worthwhile. On the question of buying a home in the next couple of years... yes, it does affect things. (Pass through status? Probably doesn't affect much.) If all of your income is coming from self-employment, be prepared for hassles when you are shopping for a mortgage. You can ask around, maybe you have a friendly loan officer at your credit union who knows your history. But in general they will want to see at least two years of self-employment tax returns. You can plan for this in advance: talk to a couple of loan officers now to see what the requirements will be. That way you can plan to be ready when the time comes.\"" }, { "docid": "438494", "title": "", "text": "\"Has anyone ever proposed significantly lowering the US corporate tax while simultaneously raising dividend taxes for high income earners? Hell, many economists believe that corporate income should be taxed at 0%. If you do this but are worried about \"\"teh evil corporations\"\" becoming too big and powerful, that's what a high tax on dividend income is for. You can't personally become rich from a corporation without earning dividend or salary income from a corporation's coffers.\"" }, { "docid": "137307", "title": "", "text": "&gt; But so long as the incremental improvement to your bottom line is there, the investment is sound, with or without taxes. wat If E(ROA)&gt;0 it's a sound investment? Not at all. &gt; any investment the company makes that improves their net income automatically means more money for the company Where is this money coming from? If it's debt-financed it escapes corporate tax rate because interest payments are deductible. Is it coming from the company's retained earnings? We have less of that now because we hiked up the corporate tax rate. Your argument also neglects the impact corporate taxes have on equity financing and corporate leverage." }, { "docid": "214358", "title": "", "text": "Here is a quote from the IRS website on this topic: You may be able to deduct premiums paid for medical and dental insurance and qualified long-term care insurance for yourself, your spouse, and your dependents. The insurance can also cover your child who was under age 27 at the end of 2011, even if the child was not your dependent. A child includes your son, daughter, stepchild, adopted child, or foster child. A foster child is any child placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction. One of the following statements must be true. You were self-employed and had a net profit for the year reported on Schedule C (Form 1040), Profit or Loss From Business; Schedule C-EZ (Form 1040), Net Profit From Business; or Schedule F (Form 1040), Profit or Loss From Farming. You were a partner with net earnings from self-employment for the year reported on Schedule K-1 (Form 1065), Partner's Share of Income, Deductions, Credits, etc., box 14, code A. You used one of the optional methods to figure your net earnings from self-employment on Schedule SE. You received wages in 2011 from an S corporation in which you were a more-than-2% shareholder. Health insurance premiums paid or reimbursed by the S corporation are shown as wages on Form W-2, Wage and Tax Statement. The insurance plan must be established, or considered to be established as discussed in the following bullets, under your business. For self-employed individuals filing a Schedule C, C-EZ, or F, a policy can be either in the name of the business or in the name of the individual. For partners, a policy can be either in the name of the partnership or in the name of the partner. You can either pay the premiums yourself or your partnership can pay them and report the premium amounts on Schedule K-1 (Form 1065) as guaranteed payments to be included in your gross income. However, if the policy is in your name and you pay the premiums yourself, the partnership must reimburse you and report the premium amounts on Schedule K-1 (Form 1065) as guaranteed payments to be included in your gross income. Otherwise, the insurance plan will not be considered to be established under your business. For more-than-2% shareholders, a policy can be either in the name of the S corporation or in the name of the shareholder. You can either pay the premiums yourself or your S corporation can pay them and report the premium amounts on Form W-2 as wages to be included in your gross income. However, if the policy is in your name and you pay the premiums yourself, the S corporation must reimburse you and report the premium amounts on Form W-2 as wages to be included in your gross income. Otherwise, the insurance plan will not be considered to be established under your business. Medicare premiums you voluntarily pay to obtain insurance in your name that is similar to qualifying private health insurance can be used to figure the deduction. If you previously filed returns without using Medicare premiums to figure the deduction, you can file timely amended returns to refigure the deduction. For more information, see Form 1040X, Amended U.S. Individual Income Tax Return. Amounts paid for health insurance coverage from retirement plan distributions that were nontaxable because you are a retired public safety officer cannot be used to figure the deduction. Take the deduction on Form 1040, line 29." }, { "docid": "142645", "title": "", "text": "\"It is definitely legal, however none of such expenses will be allowed as a tax deduction for the corporation. Basically, you'll end up paying more to maintain the entity and pay taxes on its income (the rent you're paying to yourself as a corporation) at corporate rates, for no apparent benefit. Being the director/executive in the corporation will make you liable for whatever the corporation is liable, so liability isn't going away. The reason corporation is considered \"\"limited liability\"\" for owners is because shareholders are shielded from the corporate liability. Not directors or executives (which are explicitly not shielded).\"" }, { "docid": "359814", "title": "", "text": "Starting and running a business in the US is actually a lot less complicated than most people think. You mention incorporation, but a corporation (or even an S-Corp) isn't generally the best entity to start a business with . Most likely you are going to want to form an LLC instead this will provide you with liability protection while minimizing your paperwork and taxes. The cost for maintaining an LLC is relatively cheap $50-$1000 a year depending on your state and you can file the paperwork to form it yourself or pay an attorney to do it for you. Generally I would avoid the snake oil salesman that pitch specific out of state LLCs (Nevada, Delaware etc..) unless you have a specific reason or intend on doing business in the state. With the LLC or a Corporation you need to make sure you maintain separate finances. If you use the LLC funds to pay personal expenses you run the risk of loosing the liability protection afforded by the LLC (piercing the corporate veil). With a single member LLC you can file as a pass through entity and your LLC income would pass through to your federal return and taxes aren't any more complicated than putting your business income on your personal return like you do now. If you have employees things get more complex and it is really easiest to use a payroll service to process state and federal tax with holding. Once your business picks up you will want to file quarterly tax payments in order to avoid an under payment penalty. Generally, most taxpayers will avoid the under payment penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller. Even if you get hit by the penalty it is only 10% of the amount of tax you didn't pay in time. If you are selling a service such writing one off projects you should be able to avoid having to collect and remit sales tax, but this is going to be very state specific. If you are selling software you will have to deal with sales tax assuming your state has a sales tax. One more thing to look at is some cities require a business license in order to operate a business within city limits so it would also be a good idea to check with your city to find out if you need a business license." }, { "docid": "141458", "title": "", "text": "\"Not really, no. The assumption you're making—withdrawals from a corporation are subject to \"\"[ordinary] income tax\"\"—is simplistic. \"\"Income tax\"\" encompasses many taxes, some more benign than others, owing to credits and exemptions based on the kind of income. Moreover, the choices you listed as benefits in the sole-proprietor case—the RRSP, the TFSA, and capital gains treatment for non-registered investments—all remain open to the owner of a small corporation ... the RRSP to the extent that the owner has received salary to create contribution room. A corporation can even, at some expense, establish a defined benefit (DB) pension plan and exceed individual RRSP contribution limits. Yes, there is a more tax-efficient way for small business owners to benefit when it comes time to retirement. Here is an outline of two things I'm aware of: If your retirement withdrawals from your Canadian small business corporation would constitute withdrawal from the corporation's retained earnings (profits), i.e. income to the corporation that had already been subject to corporate income tax in prior years, then the corporation is able to declare such distributions as dividends and issue you a T5 slip (Statement of Investment Income) instead of a T4 slip (Statement of Remuneration Paid). Dividends received by Canadian residents from Canadian corporations benefit from the Dividend Tax Credit (DTC), which substantially increases the amount of income you can receive without incurring income tax. See TaxTips.ca - Non-eligible (small business) dividend tax credit (DTC). Quote: For a single individual with no income other than taxable Canadian dividends which are eligible for the small business dividend tax credit, in 2014 approximately $35,551 [...] could be earned before any federal* taxes were payable. * Provincial DTCs vary, and so combined federal/provincial maximums vary. See here. If you're wondering about \"\"non-eligible\"\" vs. \"\"eligible\"\": private small business corporation dividends are generally considered non-eligible for the best DTC benefit—but they get some benefit—while a large public corporation's dividends would generally be considered eligible. Eligible/non-eligible has to do with the corporation's own income tax rates; since Canadian small businesses already get a big tax break that large companies don't enjoy, the DTC for small businesses isn't as good as the DTC for public company dividends. Finally, even if there is hardly any same-year income tax advantage in taking dividends over salary from an active small business corporation (when you factor in both the income tax paid by the corporation and the individual), dividends still allow a business owner to smooth his income over time, which can result in a lower lifetime average tax rate. So you can use your business as a retained earnings piggy bank to spin off dividends that attract less tax than ordinary income. But! ... if you can convince somebody to buy your business from you, then you can benefit from the lifetime capital gains exemption of up to $800,000 on qualifying small business shares. i.e. you can receive up to $800K tax-free on the sale of your small business shares. This lifetime capital gains exemption is a big carrot—designed, I believe, to incentivize Canadian entrepreneurs to develop going-concern businesses that have value beyond their own time in the business. This means building things that would make your business worth buying, e.g. a valued brand or product, a customer base, intellectual property, etc. Of course, there are details and conditions with all of what I described, and I am not an accountant, so please consult a qualified, conflict-free professional if you need advice specific to your situation.\"" }, { "docid": "384617", "title": "", "text": "\"I think you are mistaken because they are consumer funded programs that ultimately get spent at entities that may or may not be corporations. A lot of hospital networks are 'non-profit', but are still seeing record inflows. These payments are not tax subsidies to stimulate a corporate activity (the 'truest' type of corporate welfare) or direct funding from the US government, per se. Your argument is the equivalent of saying: \"\"food stamps are nothing but a corporate subsidy for grocery stores\"\"\"" }, { "docid": "188618", "title": "", "text": "Well, with TiSA, even the smallest government procurements, down even to the municipal level, those contracts will have to [be liberalised](https://www.youtube.com/watch?v=2_pPqnbXpA4), opening them to bidding from companies from all around the world. This will end those programs that steer jobs to a country's own companies or farms, often by means of means tested subsidies or carve outs for certain favored groups, stealing money from corporations. Conservatives will be happy because all those New Deal style programs will be a thing of the past. The FTAs should also result in a vast expansion of the educational marketplace. [Like GATS](http://www.iatp.org/files/GATS_and_Public_Service_Systems.htm), the TiSA mandates massive irreversible privatization, but it [goes much further](http://www.world-psi.org/en/psi-special-report-tisa-versus-public-services)." }, { "docid": "590233", "title": "", "text": "Haven't there been examples of governments defaulting, delaying payment and imposing haircuts on investors? Greece and Argentina come to mind. Quite a few Govt have defaulted in the past or were very of default or crisis. Most 3rd world countries or developing countries have under gone stress at some point. Greece was amongst the first example of Developed country going bankrupt. am I not better off if the fund invests solely in AAA corporate bonds, avoiding government bonds? Well that depends. Corporate bonds are not safer than Government Bonds. There have been instances of Corporate bonds not giving the required returns." }, { "docid": "438975", "title": "", "text": "Goddady.com will gladly accept payment from your personal account. They don't really care, as long as you approve the charge, whose name the account is in. I'm not sure PayPal even check the names on the invoice and the account to match, they just want you to login. However, depending on your local laws, you may be required to have a separate business account. In the US, for example, corporations must have their own accounts. For other entities with limited liability (like LLC or LLP) it is advised to have a separate account to avoid piercing corporate veil. Also, if your business name is not your personal name - clients may want to verify that the checks/transfers are deposited under your business name. In some countries checks written out to X cannot be endorsed by X to be transferred to Y. That may affect your decision as well. You'll have to get a proper legal advice valid in your jurisdiction to know the answer to your question." }, { "docid": "12822", "title": "", "text": "avoid corporation tax There aren't many avenues to save on corporation tax legally. The best option you can try is paying into a generous pension for yourself, which will save some corporation tax. Buying a house You can claim deduction for the mortgage payments, but profits on selling the house will require paying capital gains tax on the profit. You can rent it out, this will be decided between your mortgage provider and your company, but the rent will go towards as income. Buying a car Not worth it. You will have to pay Class 1A NI contribution for benefits in kind. Any sane accountant will ask you to buy the car yourself and expense the mileage. Any income generated from the cash you have is taxable. Even the interest being paid on your money is taxable." }, { "docid": "59023", "title": "", "text": "\"According to an article on Bankrate.com from 2011, yes, it can hurt your credit: With individual liability accounts, the employee holds all responsibility for the charges, even if the company pays the issuer directly. Joint liability means the company and employee share the responsibility for payments, says Mahendra Gupta, author of the RPMG survey. In both cases, if the card isn't paid and the account becomes delinquent, it will pop up on the employee's credit report and dent his or her credit score, says Barry Paperno, consumer affairs manager at myFICO.com. It doesn't matter if the company was supposed to make the payment; the repercussions fall on the employee. \"\"It will impact your score no differently than if you were late on one of your own accounts,\"\" Paperno says. Usually, with corporate credit cards, the employee is liable along with the employer for charges on the card. The intent is to provide the employee with an incentive not to misuse the card. However, this can be a problem if your company is late in paying bills. In the distant past, I had a corporate credit card. I was not supposed to have to pay the bill, but I did receive a bill in the mail every month. And occasionally, the payment was late. In my case, these late payments never showed up on my credit report. I can't remember now whether or not this card was reported on my credit report at all. And I remember being told when I got the card that I was jointly responsible for the card with the company. However, your experience may be different. Do the on-time payments show up on your credit report? If so, that may be an indication that a late payment might appear.\"" }, { "docid": "338277", "title": "", "text": "There are two totally different things: There is your limited company, and there is yourself. Your limited company will absolutely have to pay 20% corporation tax on all its profits. The profits are the income of the limited company (you say it's £5,000 a year) minus all expenses. Usually you would pay yourself a salary, which immediately reduces your profits. And of course the payment to the accountant will reduce the profits. If the limited company is your only source of income, the usual method is to pay yourself £10,600 salary a year, possible pay money into a pension for yourself which is tax free and reduces the company's profits, pay 20% corporation on the rest, and pay yourself a dividend twice a year. Unless you have another job where you make a lot of money, you should have paid all that money to yourself as income and paid zero corporation tax. And may I say that if you made £5,000 a year, then there is most likely not enough going on to justify that an accountant charges you £600. You should be able to find someone doing it cheaper; I cannot imagine that he or she had to do a lot of work for this." }, { "docid": "175072", "title": "", "text": "\"If you are in the US, you legally must file taxes on any income whatsoever. How much you will pay in taxes, if any, will depend on your total taxable income. Now, for small transactions, the payments are often not reported to the IRS so some people do not file or pay. The threshold at which they payer is required to send a 1099 to the IRS is $600. Patreon considers each donation a separate transaction and therefore does not send a 1099 to the IRS unless you make more than $20,000 in a calendar year. If they do not report it, the IRS will not know about it unless they audit you or something. However, you are technically and legally responsible to report income whether the IRS knows about it or not. -------- EDIT ------- Note that the payer files a 1099, not the recipient. In order to report your patreon income you will either use schedule C or add it to the amount on 1040 line 21 (\"\"other income\"\") depending on whether you consider this a business or a hobby. If it's a business and it's a lot of money you should consider sending in quarterly payments using a 1040-ES in order to avoid a penalty for too little withholding.\"" } ]

[ { "docid": "573518", "title": "", "text": "\"Arguably, \"\"because they can\"\". Canada's banking industry is dominated by five chartered banks who by virtue of their size, pretty much determine how banking is done in Canada. Yes, they have to abide by government regulation, but they carry enough weight to influence government and to some extent shape the regulation they have to follow. While this situation makes Canada's financial system very stable and efficient, it also permits anti-competitive behavior. There was a time (when U.S. banks were not permitted to operate across state lines) when the smallest of Canada's \"\"big 5\"\" was bigger than the biggest U.S. bank, despite our economy having always been about 1/10 the size of the U.S. That scale and their small number gives the \"\"big 5\"\" the ability to invest heavily in and collaborate on whatever they decide to be in their own interest. So, if they want to charge fees, they do.\"" } ]

[ { "docid": "25906", "title": "", "text": "\"To avoid nitpicks, i state up front that this answer is applicable to the US; Europeans, Asians, Canadians, etc may well have quite different systems and rules. You have nothing to worry about if you pay off your credit-card statement in full on the day it is due in timely fashion. On the other hand, if you routinely carry a balance from month to month or have taken out cash advances, then making whatever payment you want to make that month ASAP will save you more in finance charges than you could ever earn on the money in your savings account. But, if you pay off each month's balance in full, then read the fine print about when the payment is due very carefully: it might say that payments received before 5 pm will be posted the same day, or it might say before 3 pm, or before 7 pm EST, or noon PST, etc etc etc. As JoeTaxpayer says, if you can pay on-line with a guaranteed day for the transaction (and you do it before any deadline imposed by the credit-card company), you are fine. My bank allows me to write \"\"electronic\"\" checks on its website, but a paper check is mailed to the credit-card company. The bank claims that if I specify the due date, they will mail the check enough in advance that the credit-card company will get it by the due date, but do you really trust the USPS to deliver your check by noon, or whatever? Besides the bank will put a hold on that money the day that check is cut. (I haven't bothered to check if the money being held still earns interest or not). In any case, the bank disclaims all responsibility for the after-effects (late payment fees, finance charges on all purchases, etc) if that paper check is not received on time and so your credit-card account goes to \"\"late payment\"\" status. Oh, and my bank also wants a monthly fee for its BillPay service (any number of such \"\"electronic\"\" checks allowed each month). The BillPay service does include payment electronically to local merchants and utilities that have accounts at the bank and have signed up to receive payments electronically. All my credit-card companies allow me to use their website to authorize them to collect the payment that I specify from my bank account(s). I can choose the day, the amount, and which of my bank accounts they will collect the money from, but I must do this every month. Very conveniently, they show a calendar for choosing the date with the due date marked prominently, and as mhoran_psprep's comment points out, the payment can be scheduled well in advance of the date that the payment will actually be made, that is, I don't need to worry about being without Internet access because of travel and thus being unable to login to the credit-card website to make the payment on the date it is due. I can also sign up for AutoPay which takes afixed amount/minimum payment due/payment in full (whatever I choose) on the date due, and this will happen month after month after month with no further action necessary on my part. With either choice, it is up to the card company to collect money from my account on the day specified, and if they mess up, they cannot charge late payment fees or finance charge on new purchases etc. Also, unlike my bank, there are no fees for this service. It is also worth noting that many people do not like the idea of the credit-card company withdrawing money from their bank account, and so this option is not to everyone's taste.\"" }, { "docid": "528247", "title": "", "text": "I see where your coming from. I was not arguing for punishing Verizon now. I was simply saying companies in general should stop trying to sell services they already provide for free, and this was a damn foolish idea on their part in the first place. Honestly, I am not that sure of the specifics in this case. I would argue it would be fine for them to charge new and monthly customers this fee. I do not think it would have been fair to try to increase prices on customers who have a contract with them. Do you know who they planned to charge this fee on? And thank you for not just down voting me because you disagree." }, { "docid": "550457", "title": "", "text": "\"Outstanding principal balance is the amount you owe at any given time, not including the amount of interest you need to pay as soon as possible. The \"\"capitalized interest\"\" shown is consistent with an average of 13.5 months between when each dollar is borrowed and when the repayment period begins. Suppose you borrow the first half of the money on September 1, 2017 and the second half of the money on February 1, 2017 (5 months later). At that point, half the money has been accruing interest for 5 months. On January 1, 2018, half the money accrued interest for 16 months, and half the money accrued interest for 11 months. The lender now expects you to start repaying the loan, with the first payment due at the end of January 2018 or the beginning of February 2018. If you make the minimum payments on time, the lender expects you to make 120 monthly payments. The last monthly payment would be at the end of December 2027 or the beginning of January 2028. The lender (or the website) should provide details about the actual payment plan, grace periods, provisions for handling inability to pay due to unemployment, and other terms. In the United States, most installment loans pretend that (for purposes of calculating interest) every month has 30 days -- even February and July! Each month, 1/12 of the \"\"annual percentage rate\"\" (APR) is charged as interest. If you do the compounding, a 6.8 percent APR corresponds to (1 + 0.068 / 12)^12 - 1 = 7.016 percent \"\"annual percentage yield\"\" (APY). Also, the APR is understated. The 6.8 percent applies to the full balance (including the loan fees), even though the borrower only gets the amount minus the loan fees. The 6.8 percent rate is useful for doing calculations after the loan fees have been charged, though. These calculations include the capitalized interest and the monthly payment amounts. A true calculation of the APR would take the loan fees into account, and give a higher number than 6.8 percent. But the corrected APR would not be useful for calculating the capitalized interest, nor for calculating the monthly payment amounts.\"" }, { "docid": "323934", "title": "", "text": "\"Open an investment account on your own and have them roll the old 401K accounts into either a ROTH or traditional IRA. Do not leave them in old 401k accounts and definitely don't roll them into your new employer's 401K. Why? Well, as great as 401K accounts are, there is one thing that employers rarely mention and the 401K companies actively try to hide: Most 401K plans are loaded with HUGE fees. You won't see them on your statements, they are often hidden very cleverly with accounting tricks. For example, in several plans I have participated in, the mutual fund symbols may LOOK like the ones you see on the stock tickers, but if you read the fine print they only \"\"approximate\"\" the underlying mutual fund they are named for. That is, if you multiply the number of shares by the market price you will arrive at a number higher than the one printed on your statement. The \"\"spread\"\" between those numbers is the fee charged by the 401K management company, and since employees don't pick that company and can't easily fire them, they aren't very competitive unless your company is really large and has a tough negotiator in HR. If you work for a small company, you are probably getting slammed by these fees. Also, they often charge fees for the \"\"automatic rebalancing\"\" service they offer to do annually to your account to keep your allocation in line with your current contribution allocations. I have no idea why it is legal for them not to disclose these fees on the statements, but they don't. I had to do some serious digging to find this out on my own and when I did it was downright scary. In one case they were siphoning off over 3% annually from the account using this standard practice. HOWEVER, that is not to say that you shouldn't participate in these plans, especially if there is an employer match. There are fees with any investment account and the \"\"free money\"\" your employer is kicking in almost always offsets these fees. My point here is just that you shouldn't keep the money in the 401K after you leave the company when you have an option to move it to an account with much cheaper fees.\"" }, { "docid": "286992", "title": "", "text": "\"Is there a solution here that would allow me to provide him with a debit card in his name that I could fund, that wouldn't have foreign transaction fees associated with it (I'd probably be okay with a small fixed ATM fee). There are separate issues here. There is no law limiting bank accounts to U.S. citizens, but most banks will not open an account for a non-citizen outside their declared service area. There are substantial legal liabilities to the bank in allowing it, whether a citizen or non-citizen. The difficulty will be compliance with the Patriot Act. This is an extension of the older \"\"Know Your Customer\"\" doctrine. It is improbable that the bank could comply with the Act without the potential customer being physically present. You would have to check with your bank in advance as to their policies. Banks are not required to accept a customer outside their policies. As to waiving the foreign transaction fee, that is very improbable. Although a handful of institutions do this in specific cases it is uncommon because the bank isn't actually charging the fee, they are passing it along. With a credit card they collect interest and waiving the fee can be thought of as a reduction in interest income, that isn't possible on a debit card. You would want to make sure you have a scrupulously honest nephew. You could be held criminally liable for any actions he takes at both the state and the federal level. U.S. law is global. A citizen who commits a crime in any country of the world can be charged for it in the United States. By being on the account you can acquire any liabilities that are created as an accomplice. This is a bigger issue at the federal level because 4,000 federal laws do not require criminal intent. Some do not require you to even know the action happened. Unlike state law which generally requires you intended to commit a crime and had to be aware of it, federal law often does not. It is also not adequate that the action is legal in Russia if it would be illegal in the United States. If I get a card in my name, and give it to him to use to withdraw money from ATMs, is that legal? What problems might that cause? It is legal, but you are now strictly liable for its use. See the above answer. It would probably get shut down anyway when they phone you and asked: \"\"are you in Russia right now?\"\" The bank is still liable for you giving away the card. The bank may close out all your accounts and submit a currency transaction report on you to the Treasury for possible money laundering. Wire the money. Plan out how much and when, but just wire it.\"" }, { "docid": "278339", "title": "", "text": "\"The answer is that it depends on your bank and your creditor (whomever you are paying). Most banks offer \"\"overdraft protection\"\". For a fee, they will process the payment as if you had the money, and your account will become \"\"overdrawn\"\". The next deposit you put in will be applied to the overdraft and once the account is \"\"zeroed\"\" funds will begin to become available. The fees charged, and whether a particular charge will go through, depend on the bank; a few banks will process a payment without a fee if it only happens occasionally, some will hit you with a charge per debit in excess of the amount, while others will charge you per day on which debit transactions were made while your account was overdrawn, and still others will tack on a charge for leaving your account overdrawn for an extended period. In almost all cases, the for-profit institutions (banks) will charge more than non-profit institutions (credit unions). Watch out for banks that offer \"\"automatic overdraft transfer\"\"; they'll automatically transfer from another account (including, eek, a credit card) to cover a debit to an account with insufficient funds. Sounds great, but the fee they charge is often close to the overdraft fee, while without overdraft protection, if the payment were simply denied at point-of-sale, most banks have smartphone apps that allow for instantaneous transfer of funds, for free. I've never heard of a \"\"partial payment\"\"; you either have sufficient funds to cover the debit or you don't. If you don't, and you don't have overdraft protection, the bank will simply decline to pay. The result of that situation depends on the exact circumstances; if a utility check bounces, they may try to run it again the next day, or they may immediately cut your utilities and come after you for the balance. At point-of-sale, they simply won't give you the merchandise. Some places are really rabid about pursuing \"\"hot check writers\"\"; if the check doesn't clear you have to pay in cash, on the spot, or they call the police. As far as \"\"interest on debt\"\", it doesn't work that way; it's a \"\"service fee\"\", otherwise it would be subject to some pretty hefty federal regulation. However, if you figure it as interest, you'd be amazed; let's say you bought lunch at a burger joint for $10. You didn't have enough in the account, but it was close, so the bank let it go - and charged you $35. You have effectively inflated the cost of that meal to $45, a 350% instantaneous price increase (or if you prefer, 350% interest on that $10); I dunno about you but if I were paying $45 for one lunch it wouldn't be at a burger joint. Most banks simply will not process a check on an already-overdrawn account, overdraft service or otherwise; they'll hit you for the overdraft fee (usually actually a fee for an NSF check) AND decline the payment. So, if you had $1 in your account and wrote a rent check for $1000, it'd still bounce even with overdraft service.\"" }, { "docid": "539734", "title": "", "text": "My experience is from travelling in Central Europe and Germany, so I've dealt with much smaller amounts of money, but the general principles are the same. Many Visa-brand ATM cards allow you to withdraw money from European ATMs for a 1% fee (plus any fees the bank may charge, my bank charged zero fee) in local currency. Even if the bank charges a 2-3% fee, the combined max 4% fee is going to be a lot smaller than most currency exchange places will offer. There are a lot of exchange offices that are built to scam tourists out of their money. We had no choice but to use one that ended up taking around 10% of the exchanged money (luckily we were only exchanging a small amount of currency). Call your bank and ask what their fees are, and if they are large, find a bank with small or zero fees and move your accounts there. Be sure to notify your bank that you are going to be travelling for an extended time in a foreign country. Literally any ATM (Geldautomat) accepted our card (thank you VISA). We literally walked off the plane with some USD and no foreign currency, and were able to stop at an ATM right outside our hotel (the taxi had a card reader, as most in Munich did). If you have a source of income secured within the country (which I am hoping you do if you will be living there) you could live off of your income, and use your USD to pay off things like credit card bills. Get a Travel Rewards Credit Card (or similar card that offers no foreign transaction fees or free currency transfers). Use this card for anything and everything you can, and pay it with a transfer from your US bank account. Under this method you'll probably have to convert some currency, but you can do so from an ATM easily enough." }, { "docid": "25397", "title": "", "text": "As it is a cheque I don't think you can deposit online. It seems that most the banks here charge a flat fee. Bank of Queensland charges $45 plus whatever the FX rate and fees are at the time. I think most of the banks have a clearance period of up to 28 days from when you deposit the cheque to when the funds clear and you could use them. If you want a cheaper and quicker option maybe try to have the USD funds sent electronically to the Australian bank account you choose." }, { "docid": "217216", "title": "", "text": "You could use: SWIFT transfer : ask your counterparty for his bank SWIFT code and beneficiary account numbers; you can do a SWIFT transfer to most countries from your Indian bank). You will need to fill a form where they ask you what you're transferring the money for, etc. Most Indian banks provide this facility. Western Union: I'm not sure if WU is in China, but they are very simple to use. Paypal: They charge heavy fees, but may be the fastest way to get your money across." }, { "docid": "595894", "title": "", "text": "There are lots of reasons why a crook would want you to do this: counterfeit check scam, laundering money, trying to get your account information, getting you used to doing questionable things and then escalating, seeing whether you're the kind of person to go along with bad ideas, etc. There are not, however, much in the way of good reasons for it. I gather you can withdraw money from your bank without an ATM fee. This I am assuming from the fact that it is being proposed that you withdraw money from your account, and the fact that this is how pretty much all non-predatory banking works. If this person's bank won't let them withdraw money without a fee, something is seriously wrong, and they should get an account at your bank. Do they get charged for using a live teller as well? If not, how is getting money from you easier than getting it from a teller? How much is the fee? If the fee is $2, and you're making $10/hour, that's 12 minutes of wages. Does it take less than 12 minutes to complete this transaction (including the time this other person is spending)? This cartoon comes to mind: https://xkcd.com/951/" }, { "docid": "5219", "title": "", "text": "Most US banks don't allow you the ability to draft a foreign currency check from USD. Though, I know Canadian banks are more workable. For instance, TD allows you to do this from CAD to many other currencies for a small fee. I believe even as a US Citizen you can quite easily open a TD Trust account and you'd be good to go. Also, at one time Zions bank was one of the few which lets US customers do this add-hoc. And there is a fee associated. Even as a business, you can't usually do this without jumping thru hoops and proving your business dealings in foreign countries. Most businesses who do this often will opt to using a payment processor service from a 3rd party which cuts checks in foreign currencies at a monthly and per check base. Your other option, which may be more feasible if you're planning on doing this often, would be to open a British bank account. But this can be difficult if not impossible due to the strict money laundering anti-fraud regulations. Many banks simply won't do it. But, you might try a few of the newer British banks like Tesco, Virgin and Metro." }, { "docid": "247199", "title": "", "text": "\"As Dheer has already told you in his answer, your plan is perfectly legal, and there are no US tax issues other than making sure that you report all the interest that you earn in all your NRE accounts (not just this one) as well as all your NRO accounts, stock and mutual fund dividends and capital gains, rental income, etc to the IRS and pay appropriate taxes. (You do get a credit from the IRS for taxes paid to India on NRO account income etc) You also may also need to report the existence of accounts if the balance exceeds $10K at any time etc. But, in addition to the foreign exchange conversion risk that Dheer has pointed out to you, have you given any thought to what is going to happen with that credit card? That 0% interest balance of $5K does not mean an interest-free loan 0f $5K for a year (with $150 service charge on that transaction). Instead, consider the following. If you use the card for any purchases, then after the first month, your purchases will be charged interest from the day that you make them till the day they are paid off: there is no 25-day grace period. The only way to avoid this is to pay off the full balance ($5K 0% interest loan PLUS $150 service charge as well as any other service charges, annual fees etc PLUS all purchases PLUS any interest) shown on the first monthly statement that you receive after taking that loan. If you choose this option, then, in effect, have taken a $5K loan for only about 55 days and have paid 3% interest (sorry, I meant to write) service fee for the privilege. If you don't use the card for any purchases at all, then the first monthly statement will show a statement balance of $5130 and (most likely) a minimum required payment of $200. By law, the minimum required payment is all interest charged for that month($0) PLUS all service fees charged during that month ($150) PLUS 1% of the rest ($50). Well, actually the law says something like \"\"a sufficient fraction of the balance to ensure that a person making the required minimum payment each month can pay off the debt in a reasonable time\"\" and most credit card companies choose 1% as the sufficient fraction and 108 months as a reasonable time. OK, so you pay the $200 and feel that you have paid off the service fee and $50 of that 0% interest loan. Not so! If you make the required minimum payment, the law allows that amount to be be applied to any part of the balance owing. It is only the excess over the minimum payment that the law says must be applied to the balance being charged the highest rate. So, you have paid off $200 of that $5K loan and still owe the service fee. The following month's statement will include interest on that unpaid $150. In short, to leave only the 0% balance owing, you have to pay $350 that first month so that next month's statement balance will be $4800 at 0%. The next month's required minimum payment will be $48, and so on. In short, you really need to keep on top of things and understand how credit-card payments really work in order to pull off your scheme successfully. Note also that the remaining part of that 0% interest balance must be paid off by the end of the period or else a humongous rate of interest will be applied retroactively from Day One, more than enough to blow away all that FD interest. So make sure that you have the cash handy to pay it off in timely fashion when it comes due.\"" }, { "docid": "473878", "title": "", "text": "The other answers touch on why having two-factor auth or some other additional system is not worth it compared to simple reactive systems (cancelling lost cards, reversing fraudulent charges etc), but it should also be noted that this goal can be achieved with a method similar to what you describe. My bank (TD Canada Trust) has an app (I'm on android) that gives you a notification immediately after your card is charged (even test charges like at the gas station). It's really simple, does not slow down authorization, and makes fraud detection super easy. (I'm sure some other banks have similar apps)." }, { "docid": "110242", "title": "", "text": "Since the transaction was not your bank's mistake (but a decision by the Indian government) why should your bank bear the cost of the unsuccessful transaction? Your bank charged a fee for a service that you were willing to pay for. You might be able to negotiate a full or partial refund, and I have done the same with my own bank for fees that I didn't feel were appropriate. Your bank will agree or not based on how much they value your business. If you are an otherwise profitable customer, they may agree to refund the fee." }, { "docid": "585661", "title": "", "text": "\"Yes, merchants may charge a fee for using a credit card. For a credit card transaction, interchange fees flow from the merchant to the card issuer. This is why Australians are seeing a boom in \"\"Debit\"\" MasterCard/VISA cards - the issuing banks make income when you select \"\"Credit\"\". These costs can be passed from the merchant to the customer as a \"\"Credit Card Fee\"\". For an EFTPOS transaction, the interchange flows the other way, from the card issuer to the acquiring bank (The merchant's bank). As an aside, the setup of these fees is why some large supermarket chains in Australia restrict you from selecting \"\"Credit\"\" with a scheme debit card (MasterCard and VISA are 'schemes'). They are 'acquirers' in the payments networks and they make interchange fees when you hit \"\"Savings\"\" and pay if you hit \"\"Credit\"\" - therefore where you can hit either \"\"Credit\"\" or \"\"Savings\"\" they prefer (and may force) you to press \"\"Savings\"\".\"" }, { "docid": "322714", "title": "", "text": "\"BoA used to do this too (probably still do). I opened an account at BoA and got low one month, and then a friend of mine cashed a $50 check that I'd given him months prior (that he said he would never cash because \"\"your money is no good here\"\"). That freaking $50 check cost me hundreds of dollars. They charged me the overdraft fee, a bounced check fee, and then ran the fucking thing through again to see if it would cash when they knew it wouldn't, so I ended up with all the fees doubled! I closed my account after that, and 2 months later, I got a notice that my account had a negative balance of more than $100 because they had charged me the monthly fee for the checking account after I closed it, and since the account was empty... buttfuckbybankapalooza.\"" }, { "docid": "358137", "title": "", "text": "why not ask a fee only financial adviser? Contact a local adviser and ask how much they will charge to work through the process. The options aren't as complex as they seem. The general idea is to first figure out what you can afford each month. This is a generally straight forward calculation. Then figure out the costs that are specific to your area, e.g property taxes. Figure out how much of a down payment /closing costs you can gather. Then start with your local bank or credit union. The number of options for mortgages will not be as complex if you already know how much you can afford and how much cash you can bring to the transaction. A simple table can be easily created based on what you can afford each month, how much cash you have, and the rates currently available. The bank will have a way to estimate the costs of each option as part of the required disclosures. Another source of good info can be a highly regarded local real estate agent. Focus on one that will represent you as a purchaser. They want you to be able to buy a house. While they do have a bias, they want a commission, most of it is eliminated if you know how much you can afford before you meet with them. They will know all the government programs that can make the monthly costs or closing costs cheaper." }, { "docid": "490529", "title": "", "text": "\"To expand on @JoeTaxpayer's answer, the devil is actually in the fine print. All the \"\"credit-card checks\"\" that I have ever received in the mail explicitly says that the checks cannot be used to pay off (or pay down) the balance on any other credit card issued by the same bank, whether the card is branded with the bank logo or is branded with a department-store or airline logo etc. The checks can be used to pay utilities, or even taxes, without paying the \"\"service fee\"\" that is charged for using a credit card for such payments. The payee is paid the face amount of the check, in contrast to charges on a credit card from a merchant who gets to collect only about 95%-98% of the amount on the \"\"charge slip\"\". Generally speaking, balance transfer offers are a bad deal regardless of whether you pay only the minimum amount due each month or whether you pay each month's statement balance in full by the due date or anything in between. The rest of this answer is an explanation in support of the above assertion. Feel free to TL;DR it if you like. If you make only the minimum payment due each month and some parts of the balance that you are carrying has different interest rates applicable than other parts, then your payment can be applied to any part of the balance at the bank's discretion. It need hardly be said that the bank invariably chooses to apply it to pay off the lowest-rate portion. By law (CARD Act of 2009), anything above the minimum payment due must be applied to pay off the highest-rate part (and then the next highest rate part, etc), but minimum payment or less is at the bank's discretion. As an illustration, suppose that you are not using your credit cards any more and are conscientiously paying down the balances due by making the minimum payment due each month. Suppose also that you have a balance of $1000 carrying 12% APR on Card A, and pay off the entire balance of $500 on Card B, transferring the amount at 0% APR to Card A for which you are billed a 2% fee. Your next minimum payment will be likely be $35; computed as $10 (interest on $1000) + $10 transfer fee + $15 (1% of balance of $1500). If you make only the minimum payment due, that payment will go towards paying off the $500, and so for next month, your balance will be $1500 of which $1035 will be charged 1% interest, and $465 will be charged 0% interest. In the months that follow, the balance on which you owe 1% interest per month will grow and the 0% balance will shrink. You have to pay more than the minimum amount due to reduce the amount that you owe. In this example, in the absence of the balance transfer, the minimum payment would have been $20 = $10 (interest on $1000 at 1% per month) + $10 (1% of balance) and would have left you with $990 due for next month. To be at the same point with the balance transfer offer, you would need to pay $30 more than the minimum payment of $35 due. This extra $30 will pay off the interest and transfer fee ($20) and the rest will be applied to the $1000 balance to reduce it to $990. There would be no balance transfer fee in future months and so the extra that you need to pay will be a little bit smaller etc. If you avoid paying interest charges on credit cards by never taking any cash advances and by paying off the monthly balance (consisting only of purchases made within the past month) in full by the due date, then the only way to avoid paying interest on the purchases made during the month of the balance transfer offer is to pay off that month's statement in full (including the balance just transferred over and the balance transfer fee) by the due date. So, depending on when in the billing cycle the transfer occurs, you are getting a loan of the balance transfer amount for 25 to 55 days and being charged 2% or 3% for the privilege. If you are getting offers of 2% balance transfer fees instead of 3%, you are probably among those who pay their balances in full each month, and the bank is trying to tempt you into doing a balance transfer by offering a lower fee. (It is unlikely that they will make a no-transfer-fee offer.) They would prefer laughing all the way to themselves by collecting a 2% transfer fee from you (and possibly interest too if you fail to read the fine print) than having you decline such offers at 3% as being too expensive. Can you make a balance transfer offer work in your favor? Sure. Don't make any purchases on the card in the month of the balance transfer or during the entire time that the 0% APR is being offered. In the month of the transfer, pay the minimum balance due plus the balance transfer fee. In succeeding months, pay the minimum balance due (typically 1% of the balance owed) each month. All of it will go to reducing the 0% APR balance because that is the only amount owing. Just before the 0% APR expires (anywhere from 6 to 24 months), pay off the remaining balance in full. But remember that you are losing the use of this card for this whole period of time. Put it away in a locked trunk in the attic because using the card to make a purchase will mean paying interest on charges from the day they post, something that might be totally alien to you.\"" }, { "docid": "546874", "title": "", "text": "\"Banks are in it to make money. But they're expected to provide a social good which powers our economy: secure money storage (bank accounts) and cashless transactions (credit/debit cards). And the government does not subsidize this. In fact, banks are being squeezed. Prudent customers dislike paying the proper cost of their account's maintenance (say, a $50/year fee for a credit card, or $9/month for a checking account) - they want it free. Meanwhile government is pretty aggressive about preventing \"\"fine print\"\" trickery that would let them recover costs other ways. However there isn't much sympathy for consumers who make trivial mistakes - whether they be technical (overdraft, late fee) or money-management mistakes (like doing balance transfers or getting fooled by promotional interest rates). So that's where banks are able to make their money: when people are imprudent. The upshot is that it's hard for a bank to make money on a prudent careful customer; those end up getting \"\"subsidized\"\" by the less-careful customers who pay fees and buy high-margin products like balance transfers. And this has created a perverse incentive: banks make more money when they actively encourage customers to be imprudent. Here, the 0% interest is to make you cocky about running up a balance, or doing balance transfers at a barely-mentioned fee of 3-5%. They know most Americans don't have $500 in the bank and you won't be able to promptly pay it off right before the 0% rate ends. (or you'll forget). And this works - that's why they do it. By law, you already get 0% interest on purchases when you pay the card in full every month. So if that's your goal, you already have it. In theory, the banks collect about 1.5% from every transaction you do, and certainly in your mind's eye, you'd think that would be enough to get by without charging interest. That doesn't work, though. The problem is, such a no-interest card would attract people who carry large balances. That would have two negative impacts: First the bank would have to spend money reborrowing, and second, the bank would have huge exposure to credit card defaults. The thing to remember is the banks are not nice guys and are not here to serve you. They're here to use you to make money, and they're not beneath encouraging you to do things that are actually bad for you. Caveat Emptor.\"" } ]

[ { "docid": "175824", "title": "", "text": "Lending isn't profitable when interest rates are this low. Consider what's involved to offer a savings or checking account. The bank must maintain branches with tellers. The bank has to pay rent (or buy and pay property taxes and utilities). The bank has to pay salaries. The bank has to maintain cash so as to make change. And pay for insurance against robbery. All of that costs money. At 6% interest, a bank can sort of make money. Not great money, but it takes in more than it has to pay out. At 4% interest, which is about where ten year mortgage rates are in Canada, the bank doesn't make enough margin. They are better off selling the loan and closing their branches than offering free checking accounts. An additional problem is that banks tend to make money from overdraft fees. But there's been a move to limit overdraft fees, as they target the most economically vulnerable. So Canadian banks tend to charge monthly fees instead. UK banks may also start charging monthly fees if interest rates stay low and other fees get curtailed." } ]

[ { "docid": "449253", "title": "", "text": "The answer is the next sentence from the Wikipedia article: The precise manner in which interest is charged is usually detailed in a cardholder agreement which may be summarized on the back of the monthly statement. Your previous question on credit card interest rates quotes the sentence after this. You have to review what the agreement for your card says. Also keep in mind the bank wants to make money from you. The more interest and fees they collect, they better they like you. If enough card holders adjust their behavior, to minimize interest and fees; the bank will then adjust the credit card agreement to get money a different way. Yes, you are right it would seem fair to only charge interest on the smaller amount, but that doesn't allow the credit card issuer to maximize profits." }, { "docid": "585661", "title": "", "text": "\"Yes, merchants may charge a fee for using a credit card. For a credit card transaction, interchange fees flow from the merchant to the card issuer. This is why Australians are seeing a boom in \"\"Debit\"\" MasterCard/VISA cards - the issuing banks make income when you select \"\"Credit\"\". These costs can be passed from the merchant to the customer as a \"\"Credit Card Fee\"\". For an EFTPOS transaction, the interchange flows the other way, from the card issuer to the acquiring bank (The merchant's bank). As an aside, the setup of these fees is why some large supermarket chains in Australia restrict you from selecting \"\"Credit\"\" with a scheme debit card (MasterCard and VISA are 'schemes'). They are 'acquirers' in the payments networks and they make interchange fees when you hit \"\"Savings\"\" and pay if you hit \"\"Credit\"\" - therefore where you can hit either \"\"Credit\"\" or \"\"Savings\"\" they prefer (and may force) you to press \"\"Savings\"\".\"" }, { "docid": "382442", "title": "", "text": "Mostly ditto to Dillip Sarwate. Let me just add: I don't know how you're making your payments, whether through the biller's web site, your bank's web site, by mail, in person, etc. But whatever the mechanism, if there is a chance that waiting until the due date to pay may mean that you will miss the due date: don't. The cost of a late payment charge is likely to far exceed any interest you would collect on your savings. Bear in mind that we are talking pennies here. I don't know how much the monthly bills that we are discussing here come to. Say it's $3,000. I think that would be a lot for most people. You say you're getting 3.6% on your savings. So if, on the average, you pay a bill 2 weeks later than you might have, you're getting an extra 2 / 52 x 3.6% x $3,000 in interest, or $4 per month. I think the last time I paid a late fee on a credit card it was $35, so if you make one mistake every 8 months and end up getting a late fee it will outweigh any savings. Personally, I pay most of my bills through either my bank's web site or the biller's web site. I schedule all payments when I get a paycheck, and I generally try to schedule them for 1 week before the due date, so there's plenty of breathing room." }, { "docid": "535165", "title": "", "text": "Schwab Bank High Yield Investor Checking Account does not charge for incoming wires (both domestic and international), and has $0 monthly fee and minimum balance (plus they offer ATM fee rebates and no international surcharge). Schwab bank does not allow International wire transfers. Accepts domestic only." }, { "docid": "539734", "title": "", "text": "My experience is from travelling in Central Europe and Germany, so I've dealt with much smaller amounts of money, but the general principles are the same. Many Visa-brand ATM cards allow you to withdraw money from European ATMs for a 1% fee (plus any fees the bank may charge, my bank charged zero fee) in local currency. Even if the bank charges a 2-3% fee, the combined max 4% fee is going to be a lot smaller than most currency exchange places will offer. There are a lot of exchange offices that are built to scam tourists out of their money. We had no choice but to use one that ended up taking around 10% of the exchanged money (luckily we were only exchanging a small amount of currency). Call your bank and ask what their fees are, and if they are large, find a bank with small or zero fees and move your accounts there. Be sure to notify your bank that you are going to be travelling for an extended time in a foreign country. Literally any ATM (Geldautomat) accepted our card (thank you VISA). We literally walked off the plane with some USD and no foreign currency, and were able to stop at an ATM right outside our hotel (the taxi had a card reader, as most in Munich did). If you have a source of income secured within the country (which I am hoping you do if you will be living there) you could live off of your income, and use your USD to pay off things like credit card bills. Get a Travel Rewards Credit Card (or similar card that offers no foreign transaction fees or free currency transfers). Use this card for anything and everything you can, and pay it with a transfer from your US bank account. Under this method you'll probably have to convert some currency, but you can do so from an ATM easily enough." }, { "docid": "53353", "title": "", "text": "There are many financial reasons why a bank would not want to allow this. While making a note of them does not answer your question, I think it's important to note why traditional CD products do not allow such contributions. Below are two reasons. If a bank wanted to offer such a product they could hypothetically create mechanisms to account for the above And guess what these types of accounts exist ... they are called savings accounts. They allow regular deposits, but often have variable interest rates, charge fees if you don't make regular deposits, or offer interest rates below a typical CD. Note you say you understand what a CD ladder is, but you haven't explained why you don't want to do it. It sounds like what you want is the convenience of a savings account but with the higher interest rate of a CD. Unfortunately, you have to give up a bit of interest if you want this convenience." }, { "docid": "463449", "title": "", "text": "\"Like a lot of businesses, they win on the averages, which means lucrative customers subsidize the money-losers. This is par for the course. It's the health club model. The people who show up everyday are subsidized by the people who never show but are too guilty to cancel. When I sent 2 DVDs a day to Netflix, they lost their shirt on me, and made it up on the customers who don't. In those \"\"free to play\"\" MMOs, actually 95-99% of the players never pay and are carried by the 1-5% who spend significantly. In business thinking, the overall marketing cost of acquiring a new customer is pretty big - $50 to $500. On the other side of the credit card swiper, they pay $600 bounty for new merchant customers - there are salesmen who live on converting 2-3 merchants a month. That's because as a rule, customers tend to lock-in. That's why dot-coms lose millions for years giving you a free service. Eventually they figure out a revenue model, and you stay with it despite the new ads, because changing is inconvenient. When you want to do a banking transaction, they must provide the means to do that. Normal banks have the staggering cost of a huge network of branch offices where you can walk in and hand a check to a teller. The whole point of an ATM is to reduce the cost of that. Chase has 3 staffed locations in my zipcode and 6 ATMs. Schwab has 3 locations in my greater metro, which contains over 400 zipcodes. If you're in a one-horse town like French Lick, Bandera or Detroit, no Schwab for miles. So for Schwab, a $3 ATM fee isn't expensive, it's cheap - compared to the cost of serving you any other way. There may also be behind-the-scenes agreements where the bank that charged you $3 refunds some of it to Schwab after they refund you. It doesn't really cost $3 to do a foreign ATM transaction. Most debit cards have a Visa or Mastercard logo. Many places will let you run it as an ATM card with a PIN entry. However everyone who takes Visa/MC must take it as a credit card using a signature. In that case, the merchant pays 2-10% depending on several factors.** Of this, about 1.4% goes to the issuing bank. This is meant to cover the bank's risk of credit card defaults. But drawing from a bank account where they can decline if the money isn't there, that risk is low so it's mostly gravy. You may find Schwab is doing OK on that alone. Also, don't use debit cards at any but the most trusted shops -- unless you fully understand how, in fraud situations, credit cards and debit cards compare -- and are comfortable with the increased risks. ** there are literally dozens of micro-fees depending on their volume, swipe vs chip, ATM vs credit, rewards cards, fixed vs online vs mobile, etc. (Home Depot does OK, the food vendor at the Renaissance Faire gets slaughtered). This kind of horsepuckey is why small-vendor services like Square are becoming hugely popular; they flat-rate everything at around 2.7%. Yay!\"" }, { "docid": "171084", "title": "", "text": "Stay out of the big four banks and pick an online bank. Most online banks don't have fees for incoming wire. Ally and Capital One 360 to name a few. You can also try credit unions. DCU doesn't charge any fees for incoming wire. Alliant Credit Union doesn't charge fees for incoming wires. USAA too doesn't charge a fee." }, { "docid": "546779", "title": "", "text": "If this matters to you a lot, I agree you should leave. My primary bank account raised chequing account and transaction fees. I left. When I was closing my account the teller asked for the reason (they needed to fill out a form) and I explained it was the monthly fees. Eventually, if a bank gets enough of these, they will change. I want to get back those features for the same price it cost when I opened it They are in their rights to cancel features or raise prices. Just as you are in your rights to withdraw if they don't give you a deal. The reason why I mention this is that this approach is comical in some instances. A grocery store may raise the price of carrots. Typically you either deal with it or change stores. Prices rise occasionally. thus they will lose a lot of money from my savings From my understanding, a bank makes a large chunk of their money from fees. Very little is from the floating kitty they can have because of your savings. If you have an investment account with your bank (not recommended) or your mortgage, that would matter more. I've had friends who have left banks (and moved their mortgages) because of the bank not giving them a better rate. Does the manager have any pressure into keeping the account to the point of giving away free products to keep the costumer or they don't really care? Depends. I've probably say no. One data point is an anecdote; it is expected in a client base of thousands that a few will leave for seemingly random reasons. Only if mass amounts of clients leave or complain will the manager or company care. A note: some banks waive monthly account or service fees if you keep a minimal account balance. I have one friend who keeps X thousand in his bank account to save the account fee; he budgets a month ahead of time and savings account rates are 0% so this costs him nothing." }, { "docid": "542075", "title": "", "text": "\"Echoing that bank fees are mostly \"\"because they can\"\", although partly this is because simply holding onto the money doesn't really pay enough for the physical infrastructure of branches, ATMs and staff. So like a budget airline they make it up on additional fees. But that document doesn't actually say they charge 3% for currency conversion! It's \"\"0.20% of transaction amount\"\" for currency conversion, which is not bad (although watch out for the \"\"spread\"\" between buying and selling rates). I see \"\"International POS/ATM Transaction Fee 3% of transaction amount\"\", which is very different. That's a card fee. The big issue with these is fraud - your card number suddenly being used in a different country will nearly always trigger extra fraud checks. It also involves a much more complicated settlement process. I'm more unimpressed with the monthly service charges and the huge $85 fee for international wire transfers.\"" }, { "docid": "404261", "title": "", "text": "The fee representing the expense ratio is charged as long as you hold the investment. It is deducted daily from the fund assets, and thus reduces the price per share (NAV per share) that is calculated each day after the markets close. The investment fee is charged only when you make an investment in the fund. So, invest in the fund in one swell foop (all $5500 or $6500 for older people, all invested in a single transaction) rather than make monthly investments into the fund (hold the money in a money-market within your Roth IRA if need be). But, do check if there are back-end loads or 12b1 fees associated with the fund. The former often disappear after a few years; the latter are another permanent drain on performance. Also, please check whether reinvestment of dividends and capital gains incur the $75 transaction fee." }, { "docid": "533933", "title": "", "text": "My view is from the Netherlands, a EU country. Con: Credit cards are more risky. If someone finds your card, they can use it for online purchases without knowing any PIN, just by entering the card number, expiration date, and security code on the back. Worse, sometimes that information is stored in databases, and those get stolen by hackers! Also, you can have agreed to do periodic payments on some website and forgot about them, stopped using the service, and be surprised about the charge later. Debit cards usually need some kind of device that requires your PIN to do online payments (the ones I have in the Netherlands do, anyway), and automated periodic payments are authorized at your bank where you can get an overview of the currently active ones. Con: Banks get a percentage of each credit card payment. Unlike debit cards where companies usually pay a tiny fixed fee for each transaction (of, say, half a cent), credit card payments usually cost them a percentage and it comes to much more, a significant part of the profit margin. I feel this is just wrong. Con: automatic monthly payment can come at an unexpected moment With debit cards, the amount is withdrawn immediately and if the money isn't there, you get an error message allowing you to pay some other way (credit card after all, other bank account, cash, etc). When a recent monthly payment from my credit card was due to be charged from my bank account recently, someone else had been paid from it earlier that day and the money wasn't there. So I had to pay interest, on something I bought weeks ago... Pro: Credit cards apparently have some kind of insurance. I've never used this and don't know how it works, but apparently you can get your money back easily after fraudulent charges. Pro: Credit cards can be more easily used internationally for online purchases I don't know how it is with Visa or MC-issued debit cards, but many US sites accept only cards that have number/expiration date/security code and thus my normal bank account debit card isn't useable. Conclusion: definitely have one, but only use it when absolutely necessary." }, { "docid": "550457", "title": "", "text": "\"Outstanding principal balance is the amount you owe at any given time, not including the amount of interest you need to pay as soon as possible. The \"\"capitalized interest\"\" shown is consistent with an average of 13.5 months between when each dollar is borrowed and when the repayment period begins. Suppose you borrow the first half of the money on September 1, 2017 and the second half of the money on February 1, 2017 (5 months later). At that point, half the money has been accruing interest for 5 months. On January 1, 2018, half the money accrued interest for 16 months, and half the money accrued interest for 11 months. The lender now expects you to start repaying the loan, with the first payment due at the end of January 2018 or the beginning of February 2018. If you make the minimum payments on time, the lender expects you to make 120 monthly payments. The last monthly payment would be at the end of December 2027 or the beginning of January 2028. The lender (or the website) should provide details about the actual payment plan, grace periods, provisions for handling inability to pay due to unemployment, and other terms. In the United States, most installment loans pretend that (for purposes of calculating interest) every month has 30 days -- even February and July! Each month, 1/12 of the \"\"annual percentage rate\"\" (APR) is charged as interest. If you do the compounding, a 6.8 percent APR corresponds to (1 + 0.068 / 12)^12 - 1 = 7.016 percent \"\"annual percentage yield\"\" (APY). Also, the APR is understated. The 6.8 percent applies to the full balance (including the loan fees), even though the borrower only gets the amount minus the loan fees. The 6.8 percent rate is useful for doing calculations after the loan fees have been charged, though. These calculations include the capitalized interest and the monthly payment amounts. A true calculation of the APR would take the loan fees into account, and give a higher number than 6.8 percent. But the corrected APR would not be useful for calculating the capitalized interest, nor for calculating the monthly payment amounts.\"" }, { "docid": "361028", "title": "", "text": "I'd like to take a moment to point out: I cannot find a bank that charges customers with a checking account fees for withdrawing from an atm owned by that same bank. It is a cornerstone of most banks now to encourage online and atm banking. You should definitely research the validity of the claim that you're associate cannot withdraw from their own account through their own bank's atm without fees. A second scenario I can think of, is that this person uses a bank that does not operate in your region. Then they cannot find an atm owned by their bank. If this is the case, they should simply go to the bank the check is drawn on, and cash it there. So far I only know of Chase bank charging non-Chase customers to cash a check drawn on a Chase account (this is a crap policy that makes me hate that bank). **disclaimer - I am not familiar with all banks, but a quick Google search of banks that operate in your region should reveal which ones if any charge their customers for use of their atms. you may or may not find the check cashing charge policy without attempting to cash the check." }, { "docid": "280433", "title": "", "text": "&gt;They’re using it as a way to manage their money better. It’s a question not necessarily of spending less but of learning how to spend smarter. And &gt;From a strictly financial perspective, layaway looks foolish. As critics point out, if you were to put the purchase on a credit card instead and pay off the amount in full by the time that the layaway period would have elapsed, you could well pay less in interest than the five-dollar service fee that most stores charge. Alternatively, if you don’t have a credit card, you could put the money you’re going to spend on the product into a savings account or under your mattress. That would save you the service fee and eliminate the risk that you’ll have to pay a cancellation fee if you end up not making all the layaway payments. Basically this. Layaways do not make financial sense. You are better off putting the money into a bank account. Why do people have such little financial control?" }, { "docid": "295328", "title": "", "text": "\"To answer your question, specific to ATM usage: It is your money. You can do with it as you wish, as long what you are doing with it is legal. There is nothing illegal about taking money out of an ATM every day of the week. That said, there are some issues. One you already mention being the typical daily limit of $300. Another, is that these days most ATMs charge you for the transaction and many banks will also charge you for the transaction. (That assumes that you are not using an ATM owned by your bank.) These fees add up quite quickly. Using the very typical $1.50/transaction (or $3/transaction total), you could make 8 transactions before the typical $25 wiring fee is more appropriate. You should also not ignore the \"\"cost\"\" of the inconvenience of having to make so many transactions. There is also the potential, however remote, that your bank may see it as suspicious activity and lead to the headaches you are trying to avoid by not wiring the money. If you don't have a checking account with that bank into which you could just transfer the money, online, by phone or whatever, I would simply jump through the required hoops. Keep in mind that these hurdles are intended to protect your money.\"" }, { "docid": "443816", "title": "", "text": "Many banks will let you generate a temporary credit card number to use in this situation. You can set the credit limit and the expiration date yourself so that the second transaction won't be accepted. I don't know of any that will let you set the credit limit to $0, but you can set it to a value under the monthly subscription fee. An answer to this question suggests that banks sometimes let the charge go through even if it exceeds the limit or the expiration date, so the plan might not work." }, { "docid": "369202", "title": "", "text": "I don't believe there is any particular structural or financial reason that outgoing wire transfers cost so much in Canada, their costs are no higher than other countries (and lower than many). Wires seem to be an area where the Canadian banks have decided people don't comparison shop, so it's not a competitive advantage to offer a better price. The rates you quoted are on the low side: $80 for a largish international wire is not unusual, and HSBC charges up to $150! There are several alternative ways to transfer money domestically in Canada. If the recipient banks at the same bank, it's possible to go into a branch and transfer money directly from your own account to their account (I've never been charged for this). The transfer is immediate. But it couldn't be done online, last time I checked. For transfers where you don't know the recipients bank account, you can pay online with Interac E-Transfers, offered by most Canadian banks. It's basically e-mailing money. It usually costs $1 to $1.50 per transfer, and has limits on how much you can send per day/week. Each of the banks also have a bill-pay service, but unlike similar services in the US (where they mail a paper check if the recipient isn't on their system), each Canadian bank has a limited number of possible payees (mostly utilities, governments, major stores)." }, { "docid": "110242", "title": "", "text": "Since the transaction was not your bank's mistake (but a decision by the Indian government) why should your bank bear the cost of the unsuccessful transaction? Your bank charged a fee for a service that you were willing to pay for. You might be able to negotiate a full or partial refund, and I have done the same with my own bank for fees that I didn't feel were appropriate. Your bank will agree or not based on how much they value your business. If you are an otherwise profitable customer, they may agree to refund the fee." } ]

[ { "docid": "483282", "title": "", "text": "The other answers in this thread do a fine job of explaining the economic situation that banks are in. In addition to that information, I would like to point out that it is not hard to avoid a monthly fee for Canadian bank accounts. Usually this involves keeping a minimum balance of a few thousand dollars at all times. Actual examples (as of Dec 2016) for the lowest tier chequing accounts. Includes information on the minimum balance to waive the monthly fee, and the monthly fee otherwise:" } ]

[ { "docid": "304276", "title": "", "text": "\"The answer, like many answers, is \"\"it depends\"\". Specifically, it depends on the broker, and the type of account you have with the broker. Most brokers will charge you once per transaction, so a commission on the buy, and a commission (and SEC fee in the US) on the sale. However, if you place a Good-til-Canceled (GTC) order, and it's partially filled one day, then partially filled another day, you'll be charged two commissions. There are other brokers (FolioFN comes to mind) that either have trading \"\"windows\"\", where you can make any number of trades within that window, or that have a fixed monthly fee, giving you any (probably with some upper limit) number of trades per month. There are other brokers (Interactive Brokers for example), that charge you the standard commission on buy and another commission and fee on sell, but can refund you some of that commission for making a market in the security, and pay you to borrow the securities. So the usual answer is \"\"two commissions\"\", but that's not universal. However, while commissions are important, with discount brokers, you'll find the percent you're paying for commissions is minimal, which losses due to slippage and poor execution can swamp.\"" }, { "docid": "217216", "title": "", "text": "You could use: SWIFT transfer : ask your counterparty for his bank SWIFT code and beneficiary account numbers; you can do a SWIFT transfer to most countries from your Indian bank). You will need to fill a form where they ask you what you're transferring the money for, etc. Most Indian banks provide this facility. Western Union: I'm not sure if WU is in China, but they are very simple to use. Paypal: They charge heavy fees, but may be the fastest way to get your money across." }, { "docid": "377357", "title": "", "text": "\"UPDATE: Unfortunately Citibank have removed the \"\"standard\"\" account option and you have to choose the \"\"plus\"\" account, which requires a minimum monthly deposit of 1800 sterling and two direct debits. Absolutely there is. I would highly recommend Citibank's Plus Current Account. It's a completely free bank account available to all UK residents. http://www.citibank.co.uk/personal/banking/bankingproducts/currentaccounts/sterling/plus/index.htm There are no monthly fees and no minimum balance requirements to maintain. Almost nobody in the UK has heard of it and I don't know why because it's extremely useful for anyone who travels or deals in foreign currency regularly. In one online application you can open a Sterling Current Account and Deposit Accounts in 10 other foreign currencies (When I opened mine around 3 years ago you could only open up to 7 (!) accounts at any one time). Citibank provide a Visa card, which you can link to any of your multi currency accounts via a phone call to their hotline (unfortunately not online, which frequently annoys me - but I guess you can't have everything). For USD and EUR you can use it as a Visa debit for USD/EUR purchases, for all other currencies you can't make debit card transactions but you can make ATM withdrawals without incurring an FX conversion. Best of all for your case, a free USD cheque book is also available: http://www.citibank.co.uk/personal/banking/international/eurocurrent.htm You can fund the account in sterling and exchange to USD through online banking. The rates are not as good as you would get through an FX broker like xe.com but they're not terrible either. You can also fund the account by USD wire transfer, which is free to deposit at Citibank - but the bank you issue the payment from will likely charge a SWIFT fee so this might not be worth it unless the amount is large enough to justify the fee. If by any chance you have a Citibank account in the US, you can also make free USD transfers in/out of this account - subject to a daily limit.\"" }, { "docid": "291914", "title": "", "text": "Some types of loans allow for reamortization (recasting) - which does exactly what you're talking about (making a big payment and then refiguring the monthly amount rather than the overall lifespan), without requiring any kind of a fee that refinancing does. Not every, or even most, mortgages, allow for recasting. And most that do offer recasting, may limit the recasting to a once-a-loan type of thing. So check beforehand, and make those big payments before you do any recasting. (Most banks and mortgage servicing companies may not advertise or even speak about recasting options unless you specifically ask your loan officer.)" }, { "docid": "384979", "title": "", "text": "[This is a company's (TradingView.com) customer subscription levels.](https://i.imgur.com/1YIPzOn.gif) Why do they charge a higher price when customers pay monthly? Monthly increases short term cash flow, right? Why do you think they make prices in such a way that it incentivizes customers to be billed every 2 years?" }, { "docid": "547737", "title": "", "text": "I doubt you're going to find anywhere that will give you free outgoing wires unless you're depositing a huge amount of money like $500K or more. An alternative would be to find a bank that offers everything else you want and use XETrade for very low cost online wires. I've used them in the past and can recommend their services. Most banks won't charge for incoming wires. I have accounts at E*Trade Bank that don't charge any fees and I can do everything online. You might want to check them out. E*Trade also offers global trading accounts which allow you to have accounts denominated in a few foreign currencies (EUR, JPY, GBP, CAD and HKD I think). I don't think there is a fee for moving money between the different currencies. If your goal is simply to diversify your money into different currencies, you could deposit money there instead of wiring it to other banks." }, { "docid": "177303", "title": "", "text": "\"My gym has a habit of randomly increasing our monthly payment with a $20 \"\"Special Fee\"\" a couple times a year. This charge was not initiated until after I signed up, and signed authorization for a set monthly fee. The agreement I signed included no wording of this fee, so I have not given them permission to charge me this fee. I also have received no type of notification of this fee prior to it being charged to my credit card on file. This seems very illegal to me. Am I right? What course of action might I have to get this stopped?\"" }, { "docid": "311349", "title": "", "text": "I can't speak for India, but for US travelers abroad, using an ATM card that reimburses transaction fees is usually the most convenient and cheapest way to obtain foreign cash. There are several banks and brokerages that offer these types of ATM cards in the US. The exchange rate is competitive and because the fees are reimbursed it's cheaper and easy than going to a bank or kiosk to exchange currencies. I don't know if you can get accounts/cards like this in India that reimburse ATM fees. For purchases, using a credit card is fine, too. Some cards charge a foreign transaction fee of ~1%, some don't. The credit card I use most of the time does charge a 1% transaction fee, but I get 2% back in rewards so I still don't mind using it when traveling." }, { "docid": "568013", "title": "", "text": "Transferwise gives an excellent exchange rate and very minimal costs. They save on costs by not actually changing any money; your money goes to someone else in the US, and the Canadia dollars you want come from someone else in Canada. No money changes currency or crosses borders, there is no bank transfer fee (assuming that domestic bank transfers, inside the country, are free), and they give an excellent exchange rate (very nearly the spot rate, I find; far better than many rates I find online for sending money across the border). I sent money from the UK to Japan with it last week, at a fixed fee of about three US dollars (I was charged in GBP, obviously). About one tenth the cost of an international bank transfer. I just double-checked; at about midday on the fifth of October 2016, they gave me a rate of 130.15 JPY per 1 GBP, and then charged me two GBP to transfer the money. The rate that day, according to xe.com, varied between 130.7 and 132 ; basically, I don't think I could have got a better deal pretty much anywhere. As I type, this very second, they offer 1.33 CAD for 1 USD , and google tells me that this very second, the exchange rate is 1.33 CAD for 1 USD - transferwise is giving the spot price. I don't think you'll get a better rate anywhere else." }, { "docid": "369202", "title": "", "text": "I don't believe there is any particular structural or financial reason that outgoing wire transfers cost so much in Canada, their costs are no higher than other countries (and lower than many). Wires seem to be an area where the Canadian banks have decided people don't comparison shop, so it's not a competitive advantage to offer a better price. The rates you quoted are on the low side: $80 for a largish international wire is not unusual, and HSBC charges up to $150! There are several alternative ways to transfer money domestically in Canada. If the recipient banks at the same bank, it's possible to go into a branch and transfer money directly from your own account to their account (I've never been charged for this). The transfer is immediate. But it couldn't be done online, last time I checked. For transfers where you don't know the recipients bank account, you can pay online with Interac E-Transfers, offered by most Canadian banks. It's basically e-mailing money. It usually costs $1 to $1.50 per transfer, and has limits on how much you can send per day/week. Each of the banks also have a bill-pay service, but unlike similar services in the US (where they mail a paper check if the recipient isn't on their system), each Canadian bank has a limited number of possible payees (mostly utilities, governments, major stores)." }, { "docid": "53353", "title": "", "text": "There are many financial reasons why a bank would not want to allow this. While making a note of them does not answer your question, I think it's important to note why traditional CD products do not allow such contributions. Below are two reasons. If a bank wanted to offer such a product they could hypothetically create mechanisms to account for the above And guess what these types of accounts exist ... they are called savings accounts. They allow regular deposits, but often have variable interest rates, charge fees if you don't make regular deposits, or offer interest rates below a typical CD. Note you say you understand what a CD ladder is, but you haven't explained why you don't want to do it. It sounds like what you want is the convenience of a savings account but with the higher interest rate of a CD. Unfortunately, you have to give up a bit of interest if you want this convenience." }, { "docid": "25247", "title": "", "text": "I think it really depends on how much you take out of your Nationwide account each month. At a certain point, it will become cheaper just to transfer your monthly rent + living allowance via an international bank transfer or using one of the currency transfer services like xe.com or Hifx. You will have to pay fees either way and/or you'll end up with a forex spread. If you have got enough money in your UK account to cover several months' worth of expenses in Germany, I would be tempted to make one big transfer every few months instead of a a monthly one; anything more than once a month is probably going to be too costly either way. It might also be worth comparing the transfer fees charged by the various banks, when I lived in the UK and had to regularly send money to Germany I found there was a massive difference between different banks for essentially the same service." }, { "docid": "25906", "title": "", "text": "\"To avoid nitpicks, i state up front that this answer is applicable to the US; Europeans, Asians, Canadians, etc may well have quite different systems and rules. You have nothing to worry about if you pay off your credit-card statement in full on the day it is due in timely fashion. On the other hand, if you routinely carry a balance from month to month or have taken out cash advances, then making whatever payment you want to make that month ASAP will save you more in finance charges than you could ever earn on the money in your savings account. But, if you pay off each month's balance in full, then read the fine print about when the payment is due very carefully: it might say that payments received before 5 pm will be posted the same day, or it might say before 3 pm, or before 7 pm EST, or noon PST, etc etc etc. As JoeTaxpayer says, if you can pay on-line with a guaranteed day for the transaction (and you do it before any deadline imposed by the credit-card company), you are fine. My bank allows me to write \"\"electronic\"\" checks on its website, but a paper check is mailed to the credit-card company. The bank claims that if I specify the due date, they will mail the check enough in advance that the credit-card company will get it by the due date, but do you really trust the USPS to deliver your check by noon, or whatever? Besides the bank will put a hold on that money the day that check is cut. (I haven't bothered to check if the money being held still earns interest or not). In any case, the bank disclaims all responsibility for the after-effects (late payment fees, finance charges on all purchases, etc) if that paper check is not received on time and so your credit-card account goes to \"\"late payment\"\" status. Oh, and my bank also wants a monthly fee for its BillPay service (any number of such \"\"electronic\"\" checks allowed each month). The BillPay service does include payment electronically to local merchants and utilities that have accounts at the bank and have signed up to receive payments electronically. All my credit-card companies allow me to use their website to authorize them to collect the payment that I specify from my bank account(s). I can choose the day, the amount, and which of my bank accounts they will collect the money from, but I must do this every month. Very conveniently, they show a calendar for choosing the date with the due date marked prominently, and as mhoran_psprep's comment points out, the payment can be scheduled well in advance of the date that the payment will actually be made, that is, I don't need to worry about being without Internet access because of travel and thus being unable to login to the credit-card website to make the payment on the date it is due. I can also sign up for AutoPay which takes afixed amount/minimum payment due/payment in full (whatever I choose) on the date due, and this will happen month after month after month with no further action necessary on my part. With either choice, it is up to the card company to collect money from my account on the day specified, and if they mess up, they cannot charge late payment fees or finance charge on new purchases etc. Also, unlike my bank, there are no fees for this service. It is also worth noting that many people do not like the idea of the credit-card company withdrawing money from their bank account, and so this option is not to everyone's taste.\"" }, { "docid": "81416", "title": "", "text": "When you give your credit card number and authorize a merchant to charge your credit card, the merchant then gives the information to their merchant processor which in turns bills the bank that issued the card (it's a little more complex and it all happens instantly unless the merchant is using the very old fasion imprinting gizmos). It is possible for a merchant to attempt to charge you more than you authorized but if they do they risk a fine ($25-$50 for a chargeback) from their processor, the legitimate portion of the charge as well as increasing the processing fees charged by their processor or even the possibility of loosing their merchant account entirely and being permanently blacklisted by Visa/Mastercard. In short no legitimate business is going to intentionally over charge your credit card. There really isn't significant risk in using a reputable online retailer's order forms. There is the possibility that their database could be compromised but that risk is lower than the risk of having an employee steal your credit number when you give it to them in person. Besides in the US at least the most you can legally be held liable for is $50 assuming you notice the discrepancy within 60 days of statement the charge appears on and most banks limit liability to $0. Over the years I have had a number of different credit card numbers stolen and used fraudulently and I have never had to pay any fraudulent charges." }, { "docid": "52250", "title": "", "text": "It sounds like your current loan is in your name. As such, you are responsible for paying it. Not your family, you. It also sounds like the loan payments are regularly late. That'll likely drastically affect your credit rating. Given what you've said, it doesn't surprise me that you were declined for a credit card. With the information on your credit report, you are a poor risk. Assuming your family is unable to pay loan on time (and assuming you aren't willing to do so), you desperately need to get your name off the loan. This may mean selling the property and closing out the loan. This won't be enough to fix your credit, though. All that will do is stop making your credit worse. It'll take a few years (five years in Canada, not sure how many years in India) until this loan stops showing up on your credit report. That's why it is important to do this immediately. Now, can a bank give you a loan or a credit card despite bad credit? Yes, absolutely. It all depends on how bad your credit is. If the bank is willing to do so, they'll most likely charge a higher interest rate. But the bank may well decide not to give you a loan. After all, your credit report shows you don't make your loan payments on time. You may also want to request your own copy of your credit report. You may have to pay for this, especially if you want to see your score. This could be valuable information if you are looking to fix your finances, and may be worth the cost. If you are sure it's just this one loan, it may not be necessary. Good luck! Edit: In India CIBIL is the authority that maintains records. Getting to know you exact score will help. CIBIL offers it via TransUnion. The non-payment will keep appearing on your record for 3 years. As you don't have any loans, get a credit card from a Bank where you have Fixed Deposits / PPF Account as it would be easier to get one. It can then help you build the credit." }, { "docid": "361028", "title": "", "text": "I'd like to take a moment to point out: I cannot find a bank that charges customers with a checking account fees for withdrawing from an atm owned by that same bank. It is a cornerstone of most banks now to encourage online and atm banking. You should definitely research the validity of the claim that you're associate cannot withdraw from their own account through their own bank's atm without fees. A second scenario I can think of, is that this person uses a bank that does not operate in your region. Then they cannot find an atm owned by their bank. If this is the case, they should simply go to the bank the check is drawn on, and cash it there. So far I only know of Chase bank charging non-Chase customers to cash a check drawn on a Chase account (this is a crap policy that makes me hate that bank). **disclaimer - I am not familiar with all banks, but a quick Google search of banks that operate in your region should reveal which ones if any charge their customers for use of their atms. you may or may not find the check cashing charge policy without attempting to cash the check." }, { "docid": "278339", "title": "", "text": "\"The answer is that it depends on your bank and your creditor (whomever you are paying). Most banks offer \"\"overdraft protection\"\". For a fee, they will process the payment as if you had the money, and your account will become \"\"overdrawn\"\". The next deposit you put in will be applied to the overdraft and once the account is \"\"zeroed\"\" funds will begin to become available. The fees charged, and whether a particular charge will go through, depend on the bank; a few banks will process a payment without a fee if it only happens occasionally, some will hit you with a charge per debit in excess of the amount, while others will charge you per day on which debit transactions were made while your account was overdrawn, and still others will tack on a charge for leaving your account overdrawn for an extended period. In almost all cases, the for-profit institutions (banks) will charge more than non-profit institutions (credit unions). Watch out for banks that offer \"\"automatic overdraft transfer\"\"; they'll automatically transfer from another account (including, eek, a credit card) to cover a debit to an account with insufficient funds. Sounds great, but the fee they charge is often close to the overdraft fee, while without overdraft protection, if the payment were simply denied at point-of-sale, most banks have smartphone apps that allow for instantaneous transfer of funds, for free. I've never heard of a \"\"partial payment\"\"; you either have sufficient funds to cover the debit or you don't. If you don't, and you don't have overdraft protection, the bank will simply decline to pay. The result of that situation depends on the exact circumstances; if a utility check bounces, they may try to run it again the next day, or they may immediately cut your utilities and come after you for the balance. At point-of-sale, they simply won't give you the merchandise. Some places are really rabid about pursuing \"\"hot check writers\"\"; if the check doesn't clear you have to pay in cash, on the spot, or they call the police. As far as \"\"interest on debt\"\", it doesn't work that way; it's a \"\"service fee\"\", otherwise it would be subject to some pretty hefty federal regulation. However, if you figure it as interest, you'd be amazed; let's say you bought lunch at a burger joint for $10. You didn't have enough in the account, but it was close, so the bank let it go - and charged you $35. You have effectively inflated the cost of that meal to $45, a 350% instantaneous price increase (or if you prefer, 350% interest on that $10); I dunno about you but if I were paying $45 for one lunch it wouldn't be at a burger joint. Most banks simply will not process a check on an already-overdrawn account, overdraft service or otherwise; they'll hit you for the overdraft fee (usually actually a fee for an NSF check) AND decline the payment. So, if you had $1 in your account and wrote a rent check for $1000, it'd still bounce even with overdraft service.\"" }, { "docid": "401454", "title": "", "text": "\"I'm pretty sure that the banks here will only allow a joint account with either all citizens or all \"\"foreign resident\"\" or tourists. You may be able to do something with Leumi since they have a US branch in NYC. What many people do (who are US citizens) is open a bank account either at a physical branch or online and then it can be managed all online. Make sure no monthly balance fees or atm fees etc. If you need to transfer money most banks will \"\"buy\"\" a US check (I have done this with Leumi) or you can go to the ATM and pull out a few thousand shekel from the USA account and deposit it right back into the Israeli account. My wife and I did this when we first arrived. Discount Bank seemed to have no fees for pulling money out and a good USD/ILS rate. Just make sure you don't have foreign transaction fees / high rates on the US account. If you need to deposit checks for him you can use the remote deposit feature and just take a picture. בהצלחה!\"" }, { "docid": "535165", "title": "", "text": "Schwab Bank High Yield Investor Checking Account does not charge for incoming wires (both domestic and international), and has $0 monthly fee and minimum balance (plus they offer ATM fee rebates and no international surcharge). Schwab bank does not allow International wire transfers. Accepts domestic only." } ]

[ { "docid": "479203", "title": "", "text": "You have to check your contract to be sure what is it you're paying for. Typically, you get some of the following features which can be unavailable to you in banks which don't charge a monthly fee: Arguably, these expenses could be paid by the interest rates your money earn to the bank. Notice how banks which don't charge a fee usually require you to have a minimum amount of cash in your account or a minimum monthly cash flow. When you pay for your bank's services in cash, there's no such restrictions. I'm not sure if typical banks in the UK would take away your credit card if you lose your job and don't qualify for that kind of card any more, but I do know banks who would. The choice is yours, and while it's indeed sad that you don't have this kind of choice in Canada, it's also not like you're paying solely for the privilege of letting them invest your money behind your back." } ]

[ { "docid": "48401", "title": "", "text": "There are a few factors at play here. Depending on the bank that has offered you the card there are different types of overdraft protection that may have been set up. Typically, if they attempt to run the card with no money, if one of these is in play, you will be spared any overdraft fees by the transaction charging to a designated overdraft account, usually savings, or by the transaction failing due to insufficient funds. If you know the transaction went through, and you know there were not enough funds in the account to cover the transactions, then you have a few options. If you have overdraft protection that auto charges insufficient funds charges to a separate account, then you have nothing to worry about. If you do not, most banks offer a grace period where you have until the end of the day to zero out your account, that is to say pay the overdraft amount and bring your balance to at least $0. If this is a charge that occurred in the past, and you have already been charged an overdraft fee, there may still be hope. I cannot speak for all banks, but I know that Chase Bank offers a once per year overdraft forgiveness, where they will get rid of the charges if you agree to bring the account out of the negative. There is a chance other banks will do the same if you call their customer service." }, { "docid": "546874", "title": "", "text": "\"Banks are in it to make money. But they're expected to provide a social good which powers our economy: secure money storage (bank accounts) and cashless transactions (credit/debit cards). And the government does not subsidize this. In fact, banks are being squeezed. Prudent customers dislike paying the proper cost of their account's maintenance (say, a $50/year fee for a credit card, or $9/month for a checking account) - they want it free. Meanwhile government is pretty aggressive about preventing \"\"fine print\"\" trickery that would let them recover costs other ways. However there isn't much sympathy for consumers who make trivial mistakes - whether they be technical (overdraft, late fee) or money-management mistakes (like doing balance transfers or getting fooled by promotional interest rates). So that's where banks are able to make their money: when people are imprudent. The upshot is that it's hard for a bank to make money on a prudent careful customer; those end up getting \"\"subsidized\"\" by the less-careful customers who pay fees and buy high-margin products like balance transfers. And this has created a perverse incentive: banks make more money when they actively encourage customers to be imprudent. Here, the 0% interest is to make you cocky about running up a balance, or doing balance transfers at a barely-mentioned fee of 3-5%. They know most Americans don't have $500 in the bank and you won't be able to promptly pay it off right before the 0% rate ends. (or you'll forget). And this works - that's why they do it. By law, you already get 0% interest on purchases when you pay the card in full every month. So if that's your goal, you already have it. In theory, the banks collect about 1.5% from every transaction you do, and certainly in your mind's eye, you'd think that would be enough to get by without charging interest. That doesn't work, though. The problem is, such a no-interest card would attract people who carry large balances. That would have two negative impacts: First the bank would have to spend money reborrowing, and second, the bank would have huge exposure to credit card defaults. The thing to remember is the banks are not nice guys and are not here to serve you. They're here to use you to make money, and they're not beneath encouraging you to do things that are actually bad for you. Caveat Emptor.\"" }, { "docid": "25906", "title": "", "text": "\"To avoid nitpicks, i state up front that this answer is applicable to the US; Europeans, Asians, Canadians, etc may well have quite different systems and rules. You have nothing to worry about if you pay off your credit-card statement in full on the day it is due in timely fashion. On the other hand, if you routinely carry a balance from month to month or have taken out cash advances, then making whatever payment you want to make that month ASAP will save you more in finance charges than you could ever earn on the money in your savings account. But, if you pay off each month's balance in full, then read the fine print about when the payment is due very carefully: it might say that payments received before 5 pm will be posted the same day, or it might say before 3 pm, or before 7 pm EST, or noon PST, etc etc etc. As JoeTaxpayer says, if you can pay on-line with a guaranteed day for the transaction (and you do it before any deadline imposed by the credit-card company), you are fine. My bank allows me to write \"\"electronic\"\" checks on its website, but a paper check is mailed to the credit-card company. The bank claims that if I specify the due date, they will mail the check enough in advance that the credit-card company will get it by the due date, but do you really trust the USPS to deliver your check by noon, or whatever? Besides the bank will put a hold on that money the day that check is cut. (I haven't bothered to check if the money being held still earns interest or not). In any case, the bank disclaims all responsibility for the after-effects (late payment fees, finance charges on all purchases, etc) if that paper check is not received on time and so your credit-card account goes to \"\"late payment\"\" status. Oh, and my bank also wants a monthly fee for its BillPay service (any number of such \"\"electronic\"\" checks allowed each month). The BillPay service does include payment electronically to local merchants and utilities that have accounts at the bank and have signed up to receive payments electronically. All my credit-card companies allow me to use their website to authorize them to collect the payment that I specify from my bank account(s). I can choose the day, the amount, and which of my bank accounts they will collect the money from, but I must do this every month. Very conveniently, they show a calendar for choosing the date with the due date marked prominently, and as mhoran_psprep's comment points out, the payment can be scheduled well in advance of the date that the payment will actually be made, that is, I don't need to worry about being without Internet access because of travel and thus being unable to login to the credit-card website to make the payment on the date it is due. I can also sign up for AutoPay which takes afixed amount/minimum payment due/payment in full (whatever I choose) on the date due, and this will happen month after month after month with no further action necessary on my part. With either choice, it is up to the card company to collect money from my account on the day specified, and if they mess up, they cannot charge late payment fees or finance charge on new purchases etc. Also, unlike my bank, there are no fees for this service. It is also worth noting that many people do not like the idea of the credit-card company withdrawing money from their bank account, and so this option is not to everyone's taste.\"" }, { "docid": "408043", "title": "", "text": "A handful of well-known banks in the United States are part of the clearXchange network, which allows customers of those banks to move money amongst them. The clearXchange service is rebranded differently by each member bank. For example, Chase calls it QuickPay, while Wells Fargo calls it SurePay, and Capital One calls it P2P Payments. To use clearXchange, the sender's bank must be part of the network. The recipient isn't required to be in the network, though if they are it makes things easier, as no setup is required on the recipient's end in that case. Otherwise, they must sign up on the clearXchange site directly. From what I can tell, most payments are fee-free within the network. I have repeating payments set up with Chase's QuickPay, and they do not charge fees." }, { "docid": "483282", "title": "", "text": "The other answers in this thread do a fine job of explaining the economic situation that banks are in. In addition to that information, I would like to point out that it is not hard to avoid a monthly fee for Canadian bank accounts. Usually this involves keeping a minimum balance of a few thousand dollars at all times. Actual examples (as of Dec 2016) for the lowest tier chequing accounts. Includes information on the minimum balance to waive the monthly fee, and the monthly fee otherwise:" }, { "docid": "275657", "title": "", "text": "While the rest of the answers seem to be focusing on the parenting strategies around giving children an allowance, I'd like to address how to accomplish that. I think the best most reasonable way to just to supply him with a checking and savings account at whichever bank you use. Most reasonable banks will have some form of no-fee account for minors/young people; others will waive fees if you have it paired with your account. Whatever way to can swing it, get the kid an account he can deposit/withdraw from and that is free of any additional services. He doesn't need to learn the pain of overdrafts or random fees yet. Then, just set up a recurring weekly/monthly transfer to the account, and let him determine his own allocation to savings and spending. If he can manage it online, even better, that's a far more useful skill than knowing how to fill out a deposit slip at the bank." }, { "docid": "280433", "title": "", "text": "&gt;They’re using it as a way to manage their money better. It’s a question not necessarily of spending less but of learning how to spend smarter. And &gt;From a strictly financial perspective, layaway looks foolish. As critics point out, if you were to put the purchase on a credit card instead and pay off the amount in full by the time that the layaway period would have elapsed, you could well pay less in interest than the five-dollar service fee that most stores charge. Alternatively, if you don’t have a credit card, you could put the money you’re going to spend on the product into a savings account or under your mattress. That would save you the service fee and eliminate the risk that you’ll have to pay a cancellation fee if you end up not making all the layaway payments. Basically this. Layaways do not make financial sense. You are better off putting the money into a bank account. Why do people have such little financial control?" }, { "docid": "81416", "title": "", "text": "When you give your credit card number and authorize a merchant to charge your credit card, the merchant then gives the information to their merchant processor which in turns bills the bank that issued the card (it's a little more complex and it all happens instantly unless the merchant is using the very old fasion imprinting gizmos). It is possible for a merchant to attempt to charge you more than you authorized but if they do they risk a fine ($25-$50 for a chargeback) from their processor, the legitimate portion of the charge as well as increasing the processing fees charged by their processor or even the possibility of loosing their merchant account entirely and being permanently blacklisted by Visa/Mastercard. In short no legitimate business is going to intentionally over charge your credit card. There really isn't significant risk in using a reputable online retailer's order forms. There is the possibility that their database could be compromised but that risk is lower than the risk of having an employee steal your credit number when you give it to them in person. Besides in the US at least the most you can legally be held liable for is $50 assuming you notice the discrepancy within 60 days of statement the charge appears on and most banks limit liability to $0. Over the years I have had a number of different credit card numbers stolen and used fraudulently and I have never had to pay any fraudulent charges." }, { "docid": "278339", "title": "", "text": "\"The answer is that it depends on your bank and your creditor (whomever you are paying). Most banks offer \"\"overdraft protection\"\". For a fee, they will process the payment as if you had the money, and your account will become \"\"overdrawn\"\". The next deposit you put in will be applied to the overdraft and once the account is \"\"zeroed\"\" funds will begin to become available. The fees charged, and whether a particular charge will go through, depend on the bank; a few banks will process a payment without a fee if it only happens occasionally, some will hit you with a charge per debit in excess of the amount, while others will charge you per day on which debit transactions were made while your account was overdrawn, and still others will tack on a charge for leaving your account overdrawn for an extended period. In almost all cases, the for-profit institutions (banks) will charge more than non-profit institutions (credit unions). Watch out for banks that offer \"\"automatic overdraft transfer\"\"; they'll automatically transfer from another account (including, eek, a credit card) to cover a debit to an account with insufficient funds. Sounds great, but the fee they charge is often close to the overdraft fee, while without overdraft protection, if the payment were simply denied at point-of-sale, most banks have smartphone apps that allow for instantaneous transfer of funds, for free. I've never heard of a \"\"partial payment\"\"; you either have sufficient funds to cover the debit or you don't. If you don't, and you don't have overdraft protection, the bank will simply decline to pay. The result of that situation depends on the exact circumstances; if a utility check bounces, they may try to run it again the next day, or they may immediately cut your utilities and come after you for the balance. At point-of-sale, they simply won't give you the merchandise. Some places are really rabid about pursuing \"\"hot check writers\"\"; if the check doesn't clear you have to pay in cash, on the spot, or they call the police. As far as \"\"interest on debt\"\", it doesn't work that way; it's a \"\"service fee\"\", otherwise it would be subject to some pretty hefty federal regulation. However, if you figure it as interest, you'd be amazed; let's say you bought lunch at a burger joint for $10. You didn't have enough in the account, but it was close, so the bank let it go - and charged you $35. You have effectively inflated the cost of that meal to $45, a 350% instantaneous price increase (or if you prefer, 350% interest on that $10); I dunno about you but if I were paying $45 for one lunch it wouldn't be at a burger joint. Most banks simply will not process a check on an already-overdrawn account, overdraft service or otherwise; they'll hit you for the overdraft fee (usually actually a fee for an NSF check) AND decline the payment. So, if you had $1 in your account and wrote a rent check for $1000, it'd still bounce even with overdraft service.\"" }, { "docid": "121255", "title": "", "text": "I'm a retired stockbroker/Registered Investment Advisor. My initial discussions with prospects never had a fee. Restricted stock is unsaleable without specific permission from the issuing company, and typically involves time specifc periods when stock can be sold and/or amounts of stock that can be sold. Not for DIY. Financial planners may be able to assist you, if they are conversant in restricted stock, though that's not a common situation for most clients. Any stockbroker at a major firm (Merrill Lynch, UBS, Royal Bank of Canada, Morgan Stanley, JP Morgan, etc.) will be knowledgeable and advise you (w/o charge) how to trade the stock. Always talk to more than one firm, and don't be in a hurry. If you feel comfortable with the discussion, you can pursue a deeper relationship. In my professional experience, clients valued service, accessibility, knowledge. Price was way down on the list; many of my clients were not wealthy people- they just needed help navigating a very confusing (and necessary) part of their lives. Good luck." }, { "docid": "585661", "title": "", "text": "\"Yes, merchants may charge a fee for using a credit card. For a credit card transaction, interchange fees flow from the merchant to the card issuer. This is why Australians are seeing a boom in \"\"Debit\"\" MasterCard/VISA cards - the issuing banks make income when you select \"\"Credit\"\". These costs can be passed from the merchant to the customer as a \"\"Credit Card Fee\"\". For an EFTPOS transaction, the interchange flows the other way, from the card issuer to the acquiring bank (The merchant's bank). As an aside, the setup of these fees is why some large supermarket chains in Australia restrict you from selecting \"\"Credit\"\" with a scheme debit card (MasterCard and VISA are 'schemes'). They are 'acquirers' in the payments networks and they make interchange fees when you hit \"\"Savings\"\" and pay if you hit \"\"Credit\"\" - therefore where you can hit either \"\"Credit\"\" or \"\"Savings\"\" they prefer (and may force) you to press \"\"Savings\"\".\"" }, { "docid": "25247", "title": "", "text": "I think it really depends on how much you take out of your Nationwide account each month. At a certain point, it will become cheaper just to transfer your monthly rent + living allowance via an international bank transfer or using one of the currency transfer services like xe.com or Hifx. You will have to pay fees either way and/or you'll end up with a forex spread. If you have got enough money in your UK account to cover several months' worth of expenses in Germany, I would be tempted to make one big transfer every few months instead of a a monthly one; anything more than once a month is probably going to be too costly either way. It might also be worth comparing the transfer fees charged by the various banks, when I lived in the UK and had to regularly send money to Germany I found there was a massive difference between different banks for essentially the same service." }, { "docid": "5219", "title": "", "text": "Most US banks don't allow you the ability to draft a foreign currency check from USD. Though, I know Canadian banks are more workable. For instance, TD allows you to do this from CAD to many other currencies for a small fee. I believe even as a US Citizen you can quite easily open a TD Trust account and you'd be good to go. Also, at one time Zions bank was one of the few which lets US customers do this add-hoc. And there is a fee associated. Even as a business, you can't usually do this without jumping thru hoops and proving your business dealings in foreign countries. Most businesses who do this often will opt to using a payment processor service from a 3rd party which cuts checks in foreign currencies at a monthly and per check base. Your other option, which may be more feasible if you're planning on doing this often, would be to open a British bank account. But this can be difficult if not impossible due to the strict money laundering anti-fraud regulations. Many banks simply won't do it. But, you might try a few of the newer British banks like Tesco, Virgin and Metro." }, { "docid": "25397", "title": "", "text": "As it is a cheque I don't think you can deposit online. It seems that most the banks here charge a flat fee. Bank of Queensland charges $45 plus whatever the FX rate and fees are at the time. I think most of the banks have a clearance period of up to 28 days from when you deposit the cheque to when the funds clear and you could use them. If you want a cheaper and quicker option maybe try to have the USD funds sent electronically to the Australian bank account you choose." }, { "docid": "201561", "title": "", "text": "You could use Bitcoin. Bitcoin is THE fee-killer. I haven't used US and China exchanges, but you can connect your US bank account to Coinbase, buy bitcoins, transfer to BTCChina, and sell for CNY. There are many other options to convert from and to Bitcoins, but Coinbase seems to be most practical and most widely used in the US and BTCChina is the largest and probably most trusted exchange in China. You can also use LocalBitocoins for both buying and selling, but people on LocalBitcoins typically charge larger fees than exchanges, though this may vary. Please read a bit about Bitcoin before using it, and be aware of the risks. It's still very new (but revolutionary and very easy and fast to move internationally). Try with a small amount first to check it out. Your electronic wallet can be stolen, and you're exposed to certain risks of exchanges shutting down or government/banks stepping over their boundaries. One nice thing is that you probably won't be affected by volatility as you won't be holding bitcoins for long. Also be aware that the Chinese don't like capital leaving China and there is a possibility that China government will introduce further regulations on exchanges (though they have stated that buying, selling and owning bitcoins is legal). You're doing the opposite, importing money into China, but you'll probably feel it in one way or the other. P.S. Approximate fast fee calculation: Coinbase has 1% transaction fee + $0.15 bank fee. Bitcoin transfer is free or in some cases with minimal 0.0001 BTC fee (a bit less than $0.01 currently). BTCChina has 0.3% trading fee and 0.5% CNY withdrawal fee. As you can see, the main fees are exchange fees, but still less than 3% and if you find a good exchange combination with low fees you're golden, or might even make money on transaction if BTC price rises. Also check this Reddit thread - there are alternative China exchanges with lower fees. P.P.S. Found this blog post, maybe a bit outdated, but probably with better calculation than mine as it takes into account exchange prices." }, { "docid": "381341", "title": "", "text": "\"Banks often offer cash to people who open savings accounts in order to drive new business. Their gain is pretty much as you think, to grow their asset base. A survey released in 2008 by UK-based Age Concern declared that only 16% of the British population have ever switched their banks‚ while 45% of marriages now end in divorce. Yip, till death do most part. In the US, similar analysis is pointing to a decline in people moving banks from the typical rate of 15% annually. If people are unwilling to change banks then how much more difficult for online brokers to get customers to switch? TD Ameritrade is offering you 30 days commission-free and some cash (0.2% - 0.4% depending on the funds you invest). Most people - especially those who use the opportunity to buy and hold - won't make much money for them, but it only takes a few more aggressive traders for them to gain overall. For financial institutions the question is straightforward: how much must they pay you to overcome your switching cost of changing institutions? If that number is sufficiently smaller than what they feel they can make in profits on having your business then they will pay. EDIT TO ELABORATE: The mechanism by which any financial institution makes money by offering cash to customers is essentially one of the \"\"law of large numbers\"\". If all you did is transfer in, say, $100,000, buy an ETF within the 30-day window (or any of the ongoing commission-free ones) and hold, then sell after a few years, they will probably lose money on you. I imagine they expect that on a large number of people taking advantage of this offer. Credit card companies are no different. More than half of people pay their monthly credit balance without incurring any interest charges. They get 30 days of credit for free. Everyone else makes the company a fortune. TD Ameritrade's fees are quite comprehensive outside of this special offer. Besides transactional commissions, their value-added services include subscription fees, administration fees, transaction fees, a few extra-special value-added services and, then, when you wish to cash out and realise your returns, an outbound transfer fee. However, you're a captured market. Since most people won't change their online brokers any more often than they'd change their bank, TD Ameritrade will be looking to offer you all sorts of new services and take commission on all of it. At most they spend $500-$600 to get you as a customer, or, to get you to transfer a lot more cash into their funds. And they get to keep you for how long? Ten years, maybe more? You think they might be able to sell you a few big-ticket items in the interim? Maybe interest you in some subscription service? This isn't grocery shopping. They can afford to think long-term.\"" }, { "docid": "473878", "title": "", "text": "The other answers touch on why having two-factor auth or some other additional system is not worth it compared to simple reactive systems (cancelling lost cards, reversing fraudulent charges etc), but it should also be noted that this goal can be achieved with a method similar to what you describe. My bank (TD Canada Trust) has an app (I'm on android) that gives you a notification immediately after your card is charged (even test charges like at the gas station). It's really simple, does not slow down authorization, and makes fraud detection super easy. (I'm sure some other banks have similar apps)." }, { "docid": "286992", "title": "", "text": "\"Is there a solution here that would allow me to provide him with a debit card in his name that I could fund, that wouldn't have foreign transaction fees associated with it (I'd probably be okay with a small fixed ATM fee). There are separate issues here. There is no law limiting bank accounts to U.S. citizens, but most banks will not open an account for a non-citizen outside their declared service area. There are substantial legal liabilities to the bank in allowing it, whether a citizen or non-citizen. The difficulty will be compliance with the Patriot Act. This is an extension of the older \"\"Know Your Customer\"\" doctrine. It is improbable that the bank could comply with the Act without the potential customer being physically present. You would have to check with your bank in advance as to their policies. Banks are not required to accept a customer outside their policies. As to waiving the foreign transaction fee, that is very improbable. Although a handful of institutions do this in specific cases it is uncommon because the bank isn't actually charging the fee, they are passing it along. With a credit card they collect interest and waiving the fee can be thought of as a reduction in interest income, that isn't possible on a debit card. You would want to make sure you have a scrupulously honest nephew. You could be held criminally liable for any actions he takes at both the state and the federal level. U.S. law is global. A citizen who commits a crime in any country of the world can be charged for it in the United States. By being on the account you can acquire any liabilities that are created as an accomplice. This is a bigger issue at the federal level because 4,000 federal laws do not require criminal intent. Some do not require you to even know the action happened. Unlike state law which generally requires you intended to commit a crime and had to be aware of it, federal law often does not. It is also not adequate that the action is legal in Russia if it would be illegal in the United States. If I get a card in my name, and give it to him to use to withdraw money from ATMs, is that legal? What problems might that cause? It is legal, but you are now strictly liable for its use. See the above answer. It would probably get shut down anyway when they phone you and asked: \"\"are you in Russia right now?\"\" The bank is still liable for you giving away the card. The bank may close out all your accounts and submit a currency transaction report on you to the Treasury for possible money laundering. Wire the money. Plan out how much and when, but just wire it.\"" }, { "docid": "528247", "title": "", "text": "I see where your coming from. I was not arguing for punishing Verizon now. I was simply saying companies in general should stop trying to sell services they already provide for free, and this was a damn foolish idea on their part in the first place. Honestly, I am not that sure of the specifics in this case. I would argue it would be fine for them to charge new and monthly customers this fee. I do not think it would have been fair to try to increase prices on customers who have a contract with them. Do you know who they planned to charge this fee on? And thank you for not just down voting me because you disagree." } ]

[ { "docid": "178942", "title": "", "text": "If your business name is your name, you are automatically considered a sole-proprietorship and any income you generate and expenses you incur can be calculated on your personal tax return. You can use QuickTax Home & Business tax software to lead you through the steps; you don't even need an accountant. One drawback of a sole-proprietorship in your name is liability. You are personally responsible for the business because you are the business. If you get sued, you can lose everything. To limit that liability you can look into opening a corporation. If the corporation gets sued you are insulated from that; the corporation goes bankrupt, not you. A lawyer and an accountant will be required to give you solid advice on this direction." } ]

[ { "docid": "383088", "title": "", "text": "In a well-managed company, employees bring more dollars to their employers than the employers pay the employees (salary and benefits). Employees trade potential reward for security (a regular paycheck). Employers take on the risk of needing to meet payroll and profit from the company's income, minus expenses. The potential rewards are much higher as an employer (self or otherwise), so the ones that do make it do quite well. But this is also consistent with your other statement that the reverse is not true; the risk of self-employment is high, and many self-employed people don't become millionaires." }, { "docid": "154743", "title": "", "text": "\"This \"\"article\"\" is pretty shit, but the one point it *should* bring up is that unemployment numbers do not include previously self-employed people that are actively looking for a job. Because I'm not on unemployment, I'm not counted as unemployed and looking for a job, even though I am. Also, unemployment benefits run out at a certain time, so the government can write off self-employed people and people who's benefits have run out. That doesn't mean that those people aren't still looking. If you think the government doesn't cook the books in their favor... well then I have at least a century's worth of history to show you.\"" }, { "docid": "194637", "title": "", "text": "No, you probably do not need to file a tax return if you received no income, and if you meet a number of other criteria. The below is copied and pasted, slightly edited, from the CRA: You must file a return for 2014 if any of the following situations apply: You have to pay tax for 2014. We sent you a request to file a return. You and your spouse or common-law partner elected to split pension income for 2014. See lines 115, 116, 129, and 210. You received working income tax benefit (WITB) advance payments in 2014. You disposed of capital property in 2014 (for example, if you sold real estate or shares) or you realized a taxable capital gain (for example, if a mutual fund or trust attributed amounts to you, or you are reporting a capital gains reserve you claimed on your 2013 return). You have to repay any of your old age security or employment insurance benefits. See line 235. You have not repaid all amounts withdrawn from your registered retirement savings plan (RRSP) under the Home Buyers’ Plan or the Lifelong Learning Plan. For more information, go to Home Buyers' Plan (HBP) or see Guide RC4112, Lifelong Learning Plan (LLP) or You have to contribute to the Canada Pension Plan (CPP). This can apply if, for 2014, the total of your net self-employment income and pensionable employment income is more than $3,500. See line 222. You are paying employment insurance premiums on self-employment and other eligible earnings. See lines 317 and 430. In general, you will want to file a tax return even if none of the above applies. You could, for example, claim a GST/HST credit even with no income. Now, if you receive any income at all, you are going to have to pay taxes, which means you are obligated to file a tax return. If sufficient taxes were deducted from your paycheque, you are still obligated to file a tax return. However, you will not have to pay penalties if you file late, even if you file very late, at least not until the CRA sends you a request to file. But be aware, you won't likely be able to tell if you owe the CRA money until you do your taxes, and if you do end up owing, there are substantial penalties for filing late. In general, I'd strongly advise filing your tax return in almost all circumstances." }, { "docid": "583371", "title": "", "text": "I would assume that under a certain threshold, HMRC doesn't even want to hear from you, because extracting taxes from you costs them more money than you are going to pay. On the other hand, I cannot find anything written about that subject. I'd suggest to call them at 0300 200 3300 and ask them. Have the annual cost of the server ready, and tell them that you will stop asking for donations if say 6 months of cost is covered. There may be an official threshold that I was unable to find. Obviously if you receive £1000 in donations and spend £100 for the server, they will want tax payment. If its £110 in donations and £100 for the server, they will likely not care. If they tell you to register as self-employed, it's not difficult, just a bit of a pain. In that case you'd have to pay tax on your income (donations) minus cost (cost for the server and any other cost)." }, { "docid": "197870", "title": "", "text": "The best way is for X to work as Independent consultant fro c.com from India by raising monthly invoices for the work done. This will avoid the complications and paperwork associated by registering a LLC in US by XF and then employing X as independent consultant in India. X may need to fill out W8-BEN forms so that there is no withholding in US Edit: Independent consultant means without having to register any legal entity either in India or in US. There are no legal regulations in US or in India to hire an independent contractor / consultant. There maybe internal policy of C.com not to have independent consultants. Payments can be made via transfer to Bank account." }, { "docid": "562526", "title": "", "text": "Some governments offer business information search for corporations in their jurisdiction. The search results may show the director information for the company. If this information is made publicly available, keep in mind there are websites that make money from indexing publicly available information to show in Google search results. I don't mean to scare you as this is a likely a slim possibility. It really depends on the privacy practices in place at the jurisdiction you're in. But do keep in mind if you're planning on doing business on the side for a few years policies may change. I would call Service Ontario (or whichever province you're incorporating in) or Corporations Canada if federally incorporating and ask them if they offer a business search service and exactly what information they make public. You might be able to reach a Privacy Officer and find out what exactly their policy is." }, { "docid": "355513", "title": "", "text": "\"I'm no lawyer and no expert, so take my remarks as entertainment only. Also see this question. If you have a U.S. SSN which is eligible for work, they may be able to pay you on 1099 basis with your SSN as a sole proprietor, unless they have some personal reason for avoiding that. So perhaps try asking about that specifically. HR policies can be weird and tricky, maybe a nudge in the right direction will help. Not What You Asked: regardless, I might recommend you register as an LLC and get an EIN (sort of SSN for companies) for a variety of reasons. It's called a \"\"limited liability\"\" company for a reason. You may also have an easier time reaping various business-related rewards, like writing off expenses. If you do so, consider a state with no income tax like Wyoming. (Or, for convenience sake, WA if you live in BC, or maybe NH if you live in Ontario.. etc.)\"" }, { "docid": "459953", "title": "", "text": "As far as I read in many articles, all earnings (capital gains and dividends) from Canadian stocks will be always tax-free. Right? There's no withholding tax, ie. a $100 dividend means you get $100. There's no withholding for capital gains in shares for anybody. You will still have to pay taxes on the amounts, but that's only due at tax time and it could be very minor (or even a refund) for eligible Canadian dividends. That's because the company has already paid tax on those dividends. In contrast, holding U.S. or any foreign stock that yields dividends in a TFSA will pay 15% withholding tax and it is not recoverable. Correct, but the 15% is a special rate for regular shares and you need to fill out a W8-BEN. Your broker will probably make sure you have every few years. But if you hold the same stock in a non-registered account, this 15% withholding tax can be used as a foreign tax credit? Is this true or not or what are the considerations? That's true but reduces your Canadian tax payable, it's not refundable, so you have to have some tax to subtract it from. Another consideration is foreign dividends are included 100% in income no mater what the character is. That means you pay tax at your highest rate always if not held in a tax sheltered account. Canadian dividends that are in a non-registered account will pay taxes, I presume and I don't know how much, but the amount can be used also as a tax credit or are unrecoverable? What happens in order to take into account taxes paid by the company is, I read also that if you don't want to pay withholding taxes from foreign > dividends you can hold your stock in a RRSP or RRIF? You don't have any withholding taxes from US entities to what they consider Canadian retirement accounts. So TFSAs and RESPs aren't covered. Note that it has to be a US fund like SPY or VTI that trades in the US, and the account has to be RRSP/RRIF. You can't buy a Canadian listed ETF that holds US stocks and get the same treatment. This is also only for the US, not foreign like Europe or Asia. Also something like VT (total world) in the US will have withholding taxes from foreign (Europe & Asia mostly) before the money gets to the US. You can't get that back. Just an honourable mention for the UK, there's no withholding taxes for anybody, and I hear it's on sale. But at some point, if I withdraw the money, who do I need to pay taxes, > U.S. or Canada? Canada." }, { "docid": "520584", "title": "", "text": "IANAL (and nor am I an accountant), so I can't give a definitive answer as to legality, but AFAIK, what you propose is legal. But what's the benefit? Avoiding corporation tax? It's simplistic – and costly – to think in terms like that. You need to run the numbers for different scenarios, and make a plan. You can end up ahead of the game precisely by choosing to pay some corporate tax each year. Really! Read on. One of the many reasons that self-employed Canadians sometimes opt for a corporate structure over being a sole proprietor is to be able to not pay themselves everything the company earns each year. This is especially important when a business has some really good years, and others, meh. Using the corporation to retain earnings can be more tax effective. Example: Imagine your corporation earns, net of accounting & other non-tax costs except for your draws, $120,000/year for 5 years, and $0 in year 6. Assume the business is your only source of income for those 6 years. Would you rather: Pay yourself the entire $120,000/yr in years 1-5, then $0 in year 6 (living off personal savings you hopefully accumulated earlier), subjecting the $120,000/yr to personal income tax only, leaving nothing in the corporation to be taxed? Very roughly speaking, assuming tax rates & brackets are level from year to year, and using this calculator (which simplifies certain things), then in Ontario, then you'd net ~$84,878/yr for years 1-5, and $0 in year 6. Overall, you realized $424,390. Drawing the income in this manner, the average tax rate on the $600,000 was 29.26%. vs. Pay yourself only $100,000/yr in years 1-5, leaving $20,000/yr subject to corporation tax. Assuming a 15.5% combined federal/provincial corporate tax rate (includes the small business deduction), then the corp. is left with $16,900/yr to add to retained earnings in years 1-5. In year 6, the corp. has $84,500 in retained earnings to be distributed to you, the sole owner, as a dividend (of the non-eligible kind.) Again, very roughly speaking, you'd personally net $73,560/yr in years 1-5, and then on the $84,500 dividend in year 6, you'd net $73,658. Overall, you realized $441,458. Drawing the income in this manner, the average tax rate on the $600K was 26.42%. i.e. Scenario 2, which spreads the income out over the six years, saved 2.84% in tax, or $14,400. Smoothing out your income is also a prudent thing to do. Would you rather find yourself in year 6, having no clients and no revenue, with nothing left to draw on? Or would you rather the company had saved money from the good years to pay you in the lean one?" }, { "docid": "15676", "title": "", "text": "You will need to register as self-employed aka sole trader (that's the whole point: pay taxes on income that you're not getting as wages from an employer, who would arrange PAYE/NI contributions), or set up a limited company (in the last case you would have the option of either getting paid as wages or as dividends — which one is better is a complex issue which varies from year to year). You'll find lots of advice on the HMRC website." }, { "docid": "136315", "title": "", "text": "\"Also within Germany the tax offices usually determine which tax office is responsible for you by asking where you were more than 180 days of the year (if e.g. you have a second flat where you work). That's a default value, though: in my experience you can ask to be handled by another tax office. E.g. I hand my tax declaration to my \"\"home\"\" tax office (where also my freelancing adress is), even though my day-job is 300 km away. So if you work mostly from Poland and just visit the German customer a few times, you are fine anyways. Difficulties start if you move to Germany to do the work at your customer's place. I'm going to assume that this is the situation as otherwise I don't think the question would have come up. Close by the link you provided is a kind of FAQ on this EU regulation About the question of permanent vs. temporary they say: The temporary nature of the service is assessed on a case-by-case basis. Here's my German-Italian experience with this. Background: I had a work contract plus contracts for services and I moved for a while to Italy. Taxes and social insurance on the Italian contracts had to be paid to Italy. Including tax on the contract for services. Due to the German-Italian tax treaty, there is no double taxation. Same for Poland: this is part of EU contracts. By the way: The temporary time frame for Italy seemed to be 3 months, then I had to provide an Italian residence etc. and was registered in the Italian health care etc. system. Due to the German-Italian tax treaty, there is no double taxation. Same for Poland: this is part of EU contracts. Besides that, the German tax office nevertheless decided that my \"\"primary center of life\"\" stayed in Germany. So everything but the stuff related to the Italian contracts (which would probably have counted as normal work contracts in Germany, though they is no exact equivalent to those contract types) was handled by the German tax office. I think this is the relevant part for your question (or: argumentation with the German tax office) of temporary vs. permanent residence. Here are some points they asked: There is one point you absolutely need to know about the German social insurance law: Scheinselbständigkeit (pretended self-employment). Scheinselbständigkeit means contracts that claim to be service contracts with a self-employed provider who is doing the work in a way that is typical for employees. This law closes a loophole so employer + employee cannot avoid paying income tax and social insurance fees (pension contributions and unemployment insurance on both sides - health insurance would have to be paid in full by the self-employed instead of partially by the employer. Employer also avoids accident insurance, and several regulations from labour law are avoided as well). Legally, this is a form of black labour which means that the employer commits a criminal offense and is liable basically for all those fees. There is a list of criteria that count towards Scheinselbständigkeit. Particularly relevant for you could be\"" }, { "docid": "170942", "title": "", "text": "I think women are at risk from it because they have a need to become self employed not a want. If you don't have a rich husband you have a choice between going back to work after your maternity leave (if you're in a country which will give you one) or being on single mom benefits. Neither are appealing. I'm self employed which means I can spend time with my baby and have money. People probably assume it's because I am part of a mlm scheme too! In my opinion mlms usually target women because of this." }, { "docid": "501361", "title": "", "text": "PA local taxes are a little tricky at times, but they do have resources to help taxpayers out. The link below is a good place to start, it provides a step by step guideline to go about your local taxes. The Address search application will tell you which locals you would need to file returns with as well as the tax rates. There are links at the bottom of the page with links to the forms and instructions. The forms are relatively easy to fill out. Act 32 For Employees/Self-Employed" }, { "docid": "87998", "title": "", "text": "TaxTips.ca's Federal Tax Rates page has basic information about income tax in Canada, and it states: Canadian federal income tax is calculated based on taxable income, then non-refundable tax credits are deducted to determine the net amount payable. For 2009, every taxpayer can earn taxable income of $10,320 ($9,600 in 2008) before paying any federal tax. [...] (emphasis mine) Of course there are also provincial taxes to consider, but generally each province has a basic personal exemption amount. TaxTips.ca's page for Ontario rates lists $8,881 as the basic personal exemption in Ontario, for 2009. Find other provinces here." }, { "docid": "390744", "title": "", "text": "\"I don't think you've mentioned which State you're in. Here in Ontario, a person who is financially incapable can have their financial responsibility and authority removed, and assigned to a trustee. The trustee might be a responsible next of kin (as her ex, you would appear unsuitable: that being a potential conflict of interest); otherwise, it can be the Public Guardian and Trustee. It that happens, then the trustee handles the money; and handles/makes any contracts on behalf of (in the name of) the incapable person. The incapable person might have income (e.g. spousal support payments) and money (e.g. bank accounts), which the trustee can document in order to demonstrate credit-worthiness (or at least solvency). For the time being, the kids see it as an adventure, but I suspect, it will get old very fast. I hope you have a counsellor to talk with about your personal relationships (I've had or tried several and at least one has been extraordinarily helpful). You're not actually expressing a worry about the children being abused or neglected. :/ Is your motive (for asking) that you want her to have a place, so that the children will like it (being there) better? As long as your kids see it as an adventure, perhaps you can be happy for them. Perhaps (I don't know: depending on the people) too it's a good (or at least a better) thing that they are visiting with friends and relatives; and, a better conversational topic with those people might be how they show your children a good time (instead of your ex's money). One possible way I thought of co-signing is if a portion of child/spousal support goes directly to the landlord. I asked the Child Support Services (who deduct money from my paycheck monthly to pay support to my ex) and they told me that they are not authorized to do this. Perhaps (I don't know) there is some way to do that, if you have your ex's cooperation and a lawyer (and perhaps a judge). You haven't said what portions of your payments are for Child support, versus Spousal support (nor, who has custody, etc). If a large part of the support is for the children, then perhaps the children can rent the place. (/wild idea) Note that, in Ontario, there are two trusteeship decisions to make: 1) financial; and 2) personal care, which includes housing and medical. Someone can retain their own 'self-care' authority even if they're judged financially incapable (or vice versa if there's a personal-care or medical decision which they cannot understand). The technical language is, \"\"Mentally Incapable of Managing Property\"\" This term applies to a person who is unable to understand information that is relevant to making a decision or is unable to appreciate the reasonably foreseeable consequences of a decision or lack of decision about his or her property. Processes for certifying an individual as being mentally incapable of managing property are prescribed in the SDA (Substitute Decisions Act), and in the Mental Health Act.\"\" The Mental Heath Act is for medical emergencies (only); but Ontario has a Substitute Decisions Act as well. An intent of the law is to protect vulnerable people. People may also acquire and/or name their own trustee and/or guardian voluntarily: via a power of attorney, a living will, etc. I don't know: how about offering the landlord a year's rent in advance, or in trust? I guess that 1) a court order can determine/override/guarantee the way in which the child support payments are directed 2) it's easier to get that order/agreement if you and your ex cooperate 3) there are housing specialists in your neighborhood: They can buy housing instead of renting it. Or be given (gifted) housing to live in.\"" }, { "docid": "2366", "title": "", "text": "&gt; The CEO of Canada’s largest grocery and drugstore chain has warned his shareholders that minimum wage hikes across Ontario and Alberta will cost his company an additional $190 million in expenses next year. &gt; “We are flagging a significant set of financial headwinds and the organization is mobilizing all of its resources to see whether or not it can close that gap,” said Loblaws Companies Ltd., CEO Galen G. Weston earlier this week. Is that really so bad of a quote? He's saying it's something they need to be aware of and address... I don't get the headline." }, { "docid": "385320", "title": "", "text": "I do NOT know the full answer but I know here are some important factors that you need to consider : Do you have a physical location in the United States? Are you working directly from Canada? With a office/business location in the United States your tax obligation to the US is much higher. Most likely you will owe some to the state in which your business is located in Payroll Tax : your employer will likely want to look into Payroll tax, because in most states the payroll tax threshold is very low, they will need to file payroll tax on their full-time, part-time employees, as well as contractor soon as the total amount in a fiscal year exceeds the threshold Related to No.1 do you have a social security number and are you legally entitled to working in the States as an individual. You will be receiving the appropriate forms and tax withholding info Related to No.3 if you don't have that already, you may want to look into how to obtain permissions to conduct business within the United States. Technically, you are a one person consulting service provider. You may need to register with a particular state to obtain the permit. The agency will also be able to provide you with ample tax documentations. Chances are you will really need to piece together multiple information from various sources to resolve this one as the situation is specific. To start, look into consulting service / contractor work permit and tax info for the state your client is located in. Work from state level up to kick start your research then research federal level, which can be more complex as it is technically international business service for Canada-US" }, { "docid": "433907", "title": "", "text": "Hourly rate is not the determinant. You could be selling widgets, not hours. Rather, there's a $30,000 annual revenue threshold for GST/HST. If your business's annual revenues fall below that amount, you don't need to register for GST/HST and in such case you don't charge your clients the tax. You could still choose to register for GST/HST if your revenues are below the threshold, in which case you must charge your clients the tax. Some businesses voluntarily enroll for GST/HST, even when below the threshold, so they can claim input tax credits. If your annual revenues exceed $30,000, you must register for GST/HST and you must charge your clients the tax. FWIW, certain kinds of supplies are exempt, but the kind of services you'd be offering as an independent contractor in Canada aren't likely to be. There's more to the GST/HST than this, so be sure to talk to a tax accountant. References:" }, { "docid": "542022", "title": "", "text": "You need to set your status as self-employed the day you started online work. If that date is a little ambiguous (as is usually the case with online business), you can start with the day you first made any money. Yes, you can deduct expenses from your revenue. But you have to be sure that the expenses were purely business related. This is how it goes: You inform HMRC about the day you started work. HMRC will assign you a UTR (Unique Tax Reference) number. Depending on how much you make you might or might not need to pay Class 2 NI contributions. You'll need to tell HMRC how much you expect to earn in the current tax year. Finally, you'll need to complete a Self-Assessment at the end of the tax year. I highly recommend setting up a business banking account. Here is a link that discusses being part-time self-employed in the UK." } ]

[ { "docid": "450371", "title": "", "text": "When you swipe your credit card, the terminal at the store makes a request of your bank, and your bank has only a few seconds to accept or reject the transaction. Once the transaction is accepted by your bank, it appears in the Pending transactions. At the end of the business day, the store submits all of the final transactions for the day to their bank in a batch, and the banks all trade transactions in a batch, and money is sent between banks. This is the process that takes a couple of days, and after this happens, you see the transaction move from your Pending transactions into the regular transactions area. Most of the time, the pending transaction and the final transaction are the same. However, there are cases where it is different. A couple of examples: With a credit account, the fact that the final amount is not known for a few days is no big deal: after all, you don't have any money in the account, and if you end up spending more than you have, the bank will happily let you take your time coming up with the money (at a steep cost, of course). With a debit card tied to your checking account, the transaction is handled the same way, as far is the store is concerned. However, your bank is not going to run the risk of you overdrawing your checking account. They also are not going to run the risk of you withdrawing money from your account that is needed to cover pending transactions. So they usually treat these pending transactions as final transactions, deducting the pending transaction from your account balance immediately. When the final transaction comes through, they adjust the transaction, and your balance goes up or down accordingly. This is one of the big drawbacks to using a debit card, in my opinion. If a bad pending transaction comes through, you are out this money until it gets straightened out." } ]

[ { "docid": "213370", "title": "", "text": "Debit cards with the Visa or Mastercard symbol on them work technically everywhere where credit cards work. There are some limitations where the respective business does not accept them, for example car rentals want a credit card for potential extra charges; but most of the time, for day-to-day shopping and dining, debit cards work fine. However, you should read up the potential risks. A credit card gives you some security by buffering incorrect/fraudulent charges from your account, and credit card companies also help you reverse incorrect charges, before you ever have to pay for it. If you use a debit card, it is your money on the line immediately - any incorrect charge, even accidential, takes your money from your account, and it is gone while you work on reversing the charge. Any theft, and your account can be cleaned out, and you will be without money while you go after the thief. Many people consider the debit card risk too high, and don't use them for this reason. However, many people do use them - it is up to you." }, { "docid": "336518", "title": "", "text": "\"The trick to using a credit card responsibly is accounting. With your old system, you were paying for everything out of your savings account. Everytime you had an expense, it was immediately withdrawn from your savings account, and you saw how much money you had left. Now, with a credit card, there isn't any money being withdrawn from your savings account until a month later, when you have a huge credit card bill. The trick is to treat every credit card transaction as if it was a debit card transaction, and subtract the money from your \"\"available funds\"\" on paper immediately. Then you'll know how much money you actually have to spend (not by looking at your bank statement, but by looking at your \"\"available funds\"\" number), and when the credit card bill comes, you'll have money sitting there waiting to go to the credit card company. This requires more work than you had with your old system, and if it sounds like too much work, you might be better off with a debit card or cash. But if you want to continue to use the credit card, you'll find that the right software will make the accounting process easier. I like YNAB, but there are other software products that work as well. Just make sure that your system accounts for each credit card transaction as it is spent, deducting the amount from your budget now, so that there is money set aside for the credit card bill. Software that simply categorizes your spending after the fact is not as useful.\"" }, { "docid": "425249", "title": "", "text": "\"Debit Cards have a certain processing delay, \"\"lag time\"\", before the transaction from the vendor completes with your bank. In the US it's typically 3 business days but I have seen even a 15 day lag from Panera Bread. I guess in the UK, payment processors have similar processing delays. A business is not obliged to run its payment processing in realtime, as that's very expensive. Whatever be the lag time, your bank is supposed to cover the payment you promised through your card. Now if you don't have agreements in place (for example, overdraft) with your bank, they will likely have to turn down payments that exceed your available balance. Here is the raw deal: In the end, the responsibility to ensure that your available balance is enough is upon you (and whether you have agreements in place to handle such situations) So what happened is very much legal, a business is not obliged to run its payment processing in realtime and no ethics are at stake. To ensure such things do not happen to me, I used to use a sub-account from which my debit card used to get paid. I have since moved to credit cards as the hassle of not overdrawing was too much (and overdraft fees from banks in the US are disastrous, especially for people who actually need such a facility)\"" }, { "docid": "28074", "title": "", "text": "\"As anecdotal experience, we have a credit account in my name as offered by bank's marketing before I could qualify by common rules for newcomers (I have an account there for years so they knew my history and reliability dynamics I guess), and my wife is subscribed as a secondary user to the same credit account with a separate card. So we share the same limits (e.g. max month usage/overdraft) and benefits (bank's discounts and bonuses when usage passes certain thresholds - and it's easier to gain these points together than alone) so in the end maintenance of the card costs zero or close to that on most months, while the card is in a program to get discounts from hundreds of shops and even offers a free or discounted airport lounge access in some places :) But the bonus program is just that - benefits come and go as global economics changes; e.g. we had free car assistance available for a couple of years but it is gone since last tariff update. Generally it is beneficial for us to do all transactions including rent etc. via these two credit cards to the same account, and then recharge its overdraft as salaries come in - we have an \"\"up to 50 days\"\" cooloff period (till 20th of next calendar month) with no penalties on having taken the loans - but if we ever did overstretch that, then tens of yearly percents would kick in. Using the card(s) for daily ops, there is a play on building up the credit history as well: while we don't really need the loans to get from month to month, it helps build an image in the face of credit organizations, which can help secure e.g. favorable mortgage rates (and other contract conditions) which are out of pocket money range :) I'd say it is not only a \"\"we against the system\"\" sort of game though, as it sort of trains our own financial discipline - every month we have (a chance) to go over our spendings to see what we did, and so we more regularly think about it in the end - so the bank probably benefits from dealing with more-educated less-random customers when it comes to the bigger loans. Regarding internet, we tend to trust more to a debit card which we populate with pocket money sufficient for upcoming or already placed (blocked) transactions. After all, a malicious shop can not sip off thousands of credit money - but only as much as you've pre-allocated there on debit.\"" }, { "docid": "564180", "title": "", "text": "My bank charges me on my statement for debit transactions, but rewards me with bogo points when I run transactions as credit. AFAIK, retailers are prevented by contract with VISA et all from recouping the merchant fee from you (instead they can mark up all prices and offer a 'cash discount'), not that you'll be able to convince your vietnamese grocer of this. The difference between debit and credit fees is large enough that even these small tricks by the bank can mean a lot of money for them. Since most retailers accept either, they recruit me into their profit game with carrots and sticks. I've since moved to an actual cash back credit card and haven't regretted it yet." }, { "docid": "507983", "title": "", "text": "I'm an Australian who just got back from a trip to Malaysia for two weeks over the New Year, so this feels a bit like dejavu! I set up a 28 Degrees credit card (my first ever!) because of their low exchange rate and lack of fees on credit card transactions. People say it's the best card for travel and I was ready for it. However, since Malaysia is largely a cash economy (especially in the non-city areas), I found myself mostly just withdrawing money from my credit card and thus getting hit with a cash advance fee ($4) and instant application of the high interest rate (22%) on the money. Since I was there already and had no other alternatives, I made five withdrawals over the two weeks and ended up paying about $21 in fees. Not great! But last time I travelled I had a Commonwealth Bank Travel Money Card (not a great idea), and if I'd used that instead on this trip and given up fees for a higher exchange rate, I would have been charged an extra $60! Presumably my Commonwealth debit card would have been the same. This isn't even including mandatory ATM fees. If I've learned anything from this experience and these envelope calculations I'm doing now, it's these:" }, { "docid": "307083", "title": "", "text": "\"The simplest answer to why you can't see it in your online statement is a design/business decision that was made, most probably originally to make online statements differ as little as possible from old fashioned monthly printed statements; the old printed statements never showed holds either. Some banks and card services actually do show these transactions online, but in my experience these are the rare exceptions - though with business/commercial accounts I saw this more, but it was still rare. This is also partly due to banks fearing lots of annoying phone calls from customers and problems with merchants, as people react to \"\"hey, renting that car didn't cost $500!\"\" and don't realize that the hold is often higher than the transaction amount and will be justified in a few days (or weeks...), etc - so please don't dispute the charges just yet. Behind the scenes, I've had bankers explain it to me thusly (the practice has bitten me before and it bothered me a lot, so I've talked to quite a few bankers about this): There are two kinds of holds: \"\"soft holds\"\" and \"\"hard holds\"\". In a soft hold, a merchant basically asks the bank, \"\"Hey, is there at least $75 in this account?\"\" The bank responds, and then has it's own individually set policy per account type as to how to treat that hold. Sometimes they reserve no money whatsoever - you are free to spend that money right out and rack up NSF fees to your heart's content. Yet some policies are to treat this identically to a hard hold and keep the money locked down until released. The hard hold is treated very much like an actual expenditure transaction, in that the money is locked and shown as no longer available to you. This varies by bank - some banks use an \"\"Account Balance\"\" and an \"\"Available Balance\"\", and some have done away with these dual terms and leave it up to you to determine what your balance is and what's \"\"available\"\" (or you have to call them). The key difference in the hard hold and a real expenditure is, technically, the money is still in your bank account; your bank has merely \"\"reserved\"\" it, earmarking it for a specific purchase (and gently promising the merchant they can have their money later), but the biggest difference is there is a time-limit. If a merchant does not process a completion to the transaction to claim the money, your bank will lift the hold after a period of time (I've seen 7-30 days as typical in the US, again varying by institution) returning your money to your balance that is available for purchasing and withdrawal. In every case, any vaguely decent banking institution allows you to call them, speak to some bank employee, and they can look up your account and inform you about the different sort of holds that are on your account that are not pending/completed purchase transactions. From a strictly cynical (perhaps rightly jaded) point of view, yes this is also used as a method to extort absurdly high fees especially from customers who keep a low balance in their account. I have had more than one bank charge NSF fees based on available balances that were due to holds made by gas pumps, for instance, even though my actual \"\"money in my account\"\" never went below $0 (the holds were for amounts larger than the actual transaction). And yes, the banks usually would waive those fees if you bothered to get someone on the phone or in person and made yourself a nuisance to the right person for long enough, but they made you work for it. But I digress.... The reality is that there are lots of back and forth and middle-men in transactions like this, and most banks try to hide as much of this from you the client as possible, partly because its a huge confusing hassle and its part of why you are paying a bank to handle this nonsense for you to start with. And, as with all institutions, rules and policies become easily adjusted to maximize revenues, and if you don't keep sizable liquid minimum balances (100% of the time, all year long) they target you for fees. To avoid this without having fat wads of extra cash in those accounts, is use an entirely disconnected credit card for reservations ONLY - especially when you are traveling and will be making rentals and booking hotels. Just tell them you wish to pay with a different card when you are done, and most merchants can do this without hassle. Since it's a credit card with monthly billing you can often end up with no balance, no waiting around for a month for payments to clear, and no bank fees! It isn't 100%, but now I never - if I can possibly avoid it - use my debit/bank card to \"\"reserve\"\" or \"\"rent\"\" anything, ever.\"" }, { "docid": "244133", "title": "", "text": "I've used PayPal for my business for a long time. Sometimes PayPal doesn't trust credit cards. Debit or direct bank transfer are reliable. There is also a charge for using a credit card but I don't think that is the reason. You may be trying to purchase a high value item. That would be a possible reason why PayPal allowed you to use credit cards in the past, but will not allow you to do so now, for these particular transactions." }, { "docid": "85252", "title": "", "text": "\"In this answer, I won't elaborate on the possibilities of fraud (or pure human error), because something can always go wrong. I will, however, explain why I think you should always keep receipts. When the (monthly or so) time comes to pay your credit card bill, your credit card company sends you a list of transactions. That list has two primary purposes, both of which I would consider equally important: While for the former item, a receipt is not necessary (though it certainly does not hurt showing the receipt along with the bill to provide further proof that the payment was indeed connected to that bill), the latter point does require you to store the receipts so you can check, item-by-item, whether each of the sums is correct (and matched with a receipt at all). So, unless you can actually memorize all the credit card transactions you did throughout the past one or two months, the receipts are the most convenient way of keeping that information until the bill arrives. Yes, your credit card company probably has some safeguards in place to reveal fraud, which might kick in in time (the criteria are mostly heuristical, it seems, with credit cards or legitimate transactions here getting blocked every now and then simply because some travelling of the actual owner was misinterpreted as theft). However, it is your money, it is your responsibility to discover any issues with the bill, just as you would check the monthly transaction list from your bank account line by line. Ultimately, that is why you sign the vendor copy of the receipt when buying something offline; if you discover an issue in your list of transactions, you have to notify your credit card company that you dispute one of the charges, and then the charging vendor has to show that they have your signature for the respective transaction. So, to summarize: Do keep your receipts, use them to check the list of transactions before paying your credit card bill. EDIT: The receipt often cannot be replaced with the bill from the vendor. The bill is useful for seeing how the sum charged by the respective vendor was created, but in turn, such bills often do not contain any payment information, or (when payment was concluded before the bill was printed, as sometimes happens in pre-paid scenarios such as hotel booking) nondescript remarks such as \"\"- PAYMENT RECEIVED -\"\", without any further indication of which one of your credit cards, debit cards, bank accounts, stored value cards, or cash was used.\"" }, { "docid": "521688", "title": "", "text": "In most cases, the brand on the card, eg Visa or MasterCard, is a middleman. The company processes the transaction, transferring $xx from the bank to the seller, and telling the bank to debit the buyer's account. The bank is at risk, not the company transacting the purchase. What's interesting is that American Express started as both. My first Amex card, issued in 1979 (long expired, but in my box of memorabilia) had no bank. American Express offered a card that offered no extended credit, it was pay in full each month. Since then, Amex started offering extended credit, i.e. with annual interest, and minimum payments, and more recently, offering transaction processing for banks which take on the credit risk, essentially becoming very similar to MasterCard and Visa." }, { "docid": "566598", "title": "", "text": "\"Most credit cards allow you to take \"\"cash advances\"\", but the fees and limits for cash advances are different than for regular purchases. You can buy stock after taking a cash advance from your credit card. When you make a cash advance, you normally pay the credit card company a fee. When you make a regular purchase, the merchant (ie, the stockbroker) pays a fee. Additionally, credit card companies can make merchants wait up to 3 months to actually receive the money, in case the transaction is disputed. Your stockbroker is unlikely to want to pay the fee, accept the delay in receiving the funds, and risking that you will dispute the transaction. Having said that, many FOREX brokers will accept credit card deposits (treated as purchases), although FOREX can be considerably riskier than the stock market. Of course, if you max out your credit cards and lose all your money, you can normally negotiate to pay back the debt for less than the original amount, especially since it's unsecured debt.\"" }, { "docid": "456147", "title": "", "text": "It is the people who you bought the ticket from. Blocking is frequently done by hotels, gas stations, or rental car companies. Also, for anything where the credit card might be used to cover any damages or charges you might incur later as part of the transaction. In essence, they are reserving part of your credit limit, ostensibly to cover charges they reasonably expect you might incur. For example, when you start pumping gas using a credit card they may block out $100 to make sure you don't pump a full tank and your credit card is declined because you ran over your limit at $3. In general, the blocks clear fairly quickly after you settle up with the company on your final bill. You can also ask the company to clear the block, but I don't think they are required to by law in any specific time period. It may be up to their (and your) agreement with the credit card company. Normally it isn't an issue and you don't even notice this going on behind the scenes, but if you keep your credit card near its limit, or use a debit card it can lead to nasty surprises (e.g. they can make you overdraw your account). One more reason not to use debit cards. More information is available here on the Federal Trade Commission's website." }, { "docid": "102002", "title": "", "text": "Is it normal in QuickBooks to have credit card expenses being shows as liabilities? Is there a way I can correct this? If they are expenses they shouldn't be negative liabilities unless you overpaid your credit card by that amount. It sounds like perhaps when you linked the account the credit/debit mapping may have been mixed up. I've not used QB Online, but it looks like you might have to un-link the account, move all the existing transactions to 'excluded' and then link the account again and flip-flop the debit/credit mapping from what it is now. Hopefully there's an easier way. This QB community thread seems to address the same issue." }, { "docid": "452486", "title": "", "text": "when they make the most money off of charging interest on late payments? This is incorrect. Do you have any data to back this? In the past decade there was a tendency by financial institutions to make money from late payments and there were certain rewards / incentives for people who paid late. However the bubble cracked soon enough and there were huge losses in the card industry. Today most of the revenue for card companies is from margins on customers who pay on time and growth avenues are promoting to pay every transaction by card. why do they actively seek people who pay their bills on time (as evidence by requiring good credit scores to get approved for a card), instead of they opposite? As indicated above. Remember if one customer defaults it wipes out margins made by tons of customers. In spite of giving credit to people with good credit score, the average credit card debit an US individual holds is still quite high." }, { "docid": "335532", "title": "", "text": "In Canada, there are many stores that take debit (Interac) but don't take Visa or MasterCard. For example, a corner store. In the US the reverse is often true: every tiny place seems to take Visa or MasterCard, but not debit. A Visa debit card looks like a Visa card to the merchant. It therefore has the benefit of being usable at places that only take Visa. (Substitute MasterCard as necessary.) This benefit is very small in Canada, less so elsewhere. Meanwhile the money is actually coming out of your bank account just like a debit card, which therefore has the benefit that you're not borrowing money, can't accidentally overspend, and run no risk of incurring interest charges. It is also a way to get what appears to be a credit card when you can't qualify for credit. If you do the majority of your spending in Canada, you don't need a Visa or MasterCard debit card. Your regular debit card (Interac) will work fine for you. If you have a credit card anyway (from another bank or whatever) then again, you don't need a debit card that can pretend to be a credit card." }, { "docid": "453299", "title": "", "text": "\"For the first part of your question; Refer to related question Why do some online stores not ask for the 3-digit code on the back of my credit card? The other case of Airport ticket machines, requires the physical presence of card. The assumption is that if you had the card before and after the transaction, it was you who used it for transaction. As the amounts are small its really easy by anyone [merchant, Banks] to write this off. The only way to misuse would be if you lost the card and someone used it. Also these ticket machines would have built in feature where by you cannot buy more than \"\"X\"\" tickets for the day. Ensuring max loss on a stolen card is limited to a small amount.\"" }, { "docid": "451453", "title": "", "text": "\"A retail revolving account is essentially a credit card offered by a store (or chain of stores) and usable only at that store. In my area, the Sears department store's \"\"Sears card\"\" would be a good example. Stores offer these to capture a bit more profit from the transaction. They don't have to pay someone else's processing fees, and they get to keep any interest you pay. Of course they also accept the costs that go along with retail lending. It operates just like any other revolving-credit card. Read the fine print of the agreement to see what the grace period is, if any, and what APR they're charging after that. These cards also serve as a marketing tool. Some stores don't accept any other card. Some can do \"\"instant approvals\"\" to encourage you to make a large purchase now rather than continuing to shop around. Some may offer special deals only if you use their card -- I paid 0% interest for a year on my refrigerator, which was convenient for me. And so on. Gasoline stations also used to offer their own cards... though these days it's common for them to offer a branded version of one of the major credit cards instead.\"" }, { "docid": "394928", "title": "", "text": "This depends on if you're talking Secured credit card, or prepaid debit card. There is no separate category for secured credit cards in the IIN list; however, it is possible some of them are classified as debit cards (despite not being debit cards). You may want to check with the issuer to verify this (and you can check the IIN, or the first 6 digits of the card number, in the list I link to above to verify). However, prepaid debit cards are debit cards, and are less likely to be accepted for travel, rental car, hotel, etc. types of charges (where a hold, similar to a deposit, is charged to the account). This is one of the major differences between a prepaid card, such as the kind you top up at the grocer, and a secured credit card, where you deposit some money but separately pay back the amount you charge on the card (as a regular card). Secured cards are classified as credit cards, while prepaid cards are debit cards. As mhoran notes, it's possible your credit limit could be too low to allow a hotel, airline, or rental agency to allow a transaction, but otherwise it should be fine." }, { "docid": "244318", "title": "", "text": "You'll need to check PayPal's terms of service for that first question. I would imagine you could, as my wife and I both have personal PayPal accounts listed at the same address. When you receive money, the senders will only see the (full) name on your account, the amount, and the transaction ID. If you set up a business account, the name on your account will be replaced with the company name. Your mailing address will not be made visible. Yes, PayPal provides an export option of your transaction history. For reference: If your volume greater than $20,000 across 200 or more transactions, then they'll be issuing a 1099-K form, anyway. That depends on the payment method. Bank transfers are instant, where cards require a settlement delay. PayPal provides buyer protection, so I'd be very dutiful in logging all of your work done to provide proof of completion, in case someone disputes a payment. Disputes can take place up to 45 days from the date of the transaction. Chargebacks can take place 120 days or more after the transaction (depends on the card network)." } ]

[ { "docid": "89506", "title": "", "text": "Take a look at http://en.wikipedia.org/wiki/Payment_gateway There is essentially a lead time between when the transaction is made and when it is settled, 2-3 business days is the lead time for settlement. The link explains the process step-by-step" } ]

[ { "docid": "408124", "title": "", "text": "When you start at a new job here in the U.S., the default means of payment is usually a paper check. Most folks will quickly set up direct deposit so that their employer deposits their paycheck directly into their personal bank account - the incentive to do so is that you receive your funds faster than if you deposit a paper check. Even if you set up direct deposit on your first day on the job, you may still receive your first paycheck as a paper check simply because the wheels of payroll processing turn slowly at some (large) companies. A counter example is a self-employed contractor - perhaps a carpenter or house painter. These folks are paid by their customers, homeowners and such. Many larger, well established contracters now accept credit card payments from customers, but smaller independents may be reluctant to set up a credit card merchant account to accept payment by card because of all the fees that are associated with accepting credit card payments. 3% transaction fees and monthly service fees can be scary to any businessman who already has very thin profit margins. In such cases, these contractors prefer to be paid by check or in cash for the simple reason that there are no fees deducted from cash payments. There are a few folks here who don't trust direct deposit, or more specifically, don't trust their employer to perform the deposit correctly and on time. Some feel uncomfortable giving their bank info to their employer, fearing someone at the company could steal money from their account. In my experience, the folks who prefer a paper paycheck are often the same folks who rush to the bank on payday to redeem their paychecks for cash. They may have a bank account (helps with check cashing) but they prefer to carry cash. I operate in a manner similar to you - I use a debit card or credit card (I only have one of each) for nearly all transactions in daily life, I use electronic payments through my bank to pay my regular bills and mortgage, and I receive my paycheck by direct deposit. There have been periods where I haven't written or received paper checks for so long that I have to hunt for where I put my checkbook! Even though I use a debit card for most store purchases, the bank account behind that debit card is actually a checking account according to the bank. Again, the system defaults to paper checks and you have the option of going electronic as well. Before we judge anyone who doesn't use direct deposit or who prefers to be paid in cold hard cash, consider that direct deposit is a luxury of stability. Steady job, home, etc. Direct deposit doesn't make sense for a contractor or day laborer who expect to work for a different person each day or week. I don't think this is all that unique to the US. There are people in every city and country who don't have long-term employment with a single employer and therefore prefer cash or paper check over electronic payments. I'd be willing to bet that this applies to the majority of people on the planet, actually." }, { "docid": "538384", "title": "", "text": "I work at a large bank, that isn't too unusual although a lot of banks are moving to fee-free basic accounts and upping their fees on other specific transactions. For example, my bank did away with minimum balance requirements to waive a monthly service fee, but we started charging $2/month for paper statements and upped our out-of-network ATM fee by 50 cents. Would like to point out that most financial institutions will reorder your transactions slightly for the purposes of accounting. It is much easier to run all transactions in big batches at the end of the day than individually as they come in. Required disclosures you receive upon account opening explain the exact order but most banks do all credits (money in) first and then debits (money out) like checks, debit cards, and ACH payments after. If you overdraft you can usually avoid a fee if you make a cash deposit before the end of the business day as the cash will go into your account before your purchases are debited. OCCASIONALLY this accounting-based reordering will result in additional fees but that is not the intended purpose of reordering them. And I would always refund any incurred fees that happened due to accounting-based transaction reordering. What Wells Fargo is doing has been illegal since 2008 and their continued appeals are hoping to get the ruling overturned so they won't have to pay out restitution to affected customers. It's frankly despicable." }, { "docid": "44843", "title": "", "text": "\"FYI, just found this (https://www.paypal.com/webapps/mpp/ua/useragreement-full#8) \"\"8.9 Currency Conversion Currency Conversion 2.5% added to the exchange rate The Currency Conversion spread applies whenever a currency conversion is required to complete your transaction. The exchange rate is determined by a financial institution and is adjusted regularly based on market conditions. Adjustments may be applied immediately and without notice to you. When your payment is funded by a debit or credit card and requires a currency conversion, you consent to and authorize PayPal to convert the currency in place of your debit or credit card issuer. You have the right to have your card issuer perform the currency conversion and can choose this option during checkout on your transaction review page before you complete the transaction.\"\" 2.5%!! Can this be true?\"" }, { "docid": "273947", "title": "", "text": "\"Exactly what accounts are affected by any given transaction is not a fixed thing. Just for example, in a simple accounting system you might have one account for \"\"stock on hand\"\". In a more complex system you might have this broken out into many accounts for different types of stock, stock in different locations, etc. So I can only suggest example specific accounts. But account type -- asset, liability, capital (or \"\"equity\"\"), income, expense -- should be universal. Debit and credit rules should be universal. 1: Sold product on account: You say it cost you $500 to produce. You don't say the selling price, but let's say it's, oh, $700. Credit (decrease) Asset \"\"Stock on hand\"\" by $500. Debit (increase) Asset \"\"Accounts receivable\"\" by $700. Credit (increase) Income \"\"Sales\"\" by $700. Debit (increase) Expense \"\"Cost of goods sold\"\" by $500. 2: $1000 spent on wedding party by friend I'm not sure how your friend's expenses affect your accounts. Are you asking how he would record this expense? Did you pay it for him? Are you expecting him to pay you back? Did he pay with cash, check, a credit card, bought on credit? I just don't know what's happening here. But just for example, if you're asking how your friend would record this in his own records, and if he paid by check: Credit (decrease) Asset \"\"checking account\"\" by $1000. Debit (increase) Expense \"\"wedding expenses\"\" by $1000. If he paid with a credit card: Credit (increase) Liability \"\"credit card\"\" by $1000. Debit (increase) Expense \"\"wedding expenses\"\" by $1000. When he pays off the credit card: Debit (decrease) Liability \"\"credit card\"\" by $1000. Credit (decrease) Asset \"\"cash\"\" by $1000. (Or more realistically, there are other expenses on the credit card and the amount would be higher.) 3: Issue $3000 in stock to partner company I'm a little shakier on this, I haven't worked with the stock side of accounting. But here's my best stab: Well, did you get anything in return? Like did they pay you for the stock? I wouldn't think you would just give someone stock as a present. If they paid you cash for the stock: Debit (increase) Asset \"\"cash\"\". Credit (decrease) Capital \"\"shareholder equity\"\". Anyone else want to chime in on that one, I'm a little shaky there. Here, let me give you the general rules. My boss years ago described it to me this way: You only need to know three things to understand double-entry accounting: 1: There are five types of accounts: Assets: anything you have that has value, like cash, buildings, equipment, and merchandise. Includes things you may not actually have in your hands but that are rightly yours, like money people owe you but haven't yet paid. Liabilities: Anything you owe to someone else. Debts, merchandise paid for but not yet delivered, and taxes due. Capital (some call it \"\"capital\"\", others call it \"\"equity\"\"): The difference between Assets and Liabilities. The owners investment in the company, retained earnings, etc. Income: Money coming in, the biggest being sales. Expenses: Money going out, like salaries to employees, cost of purchasing merchandise for resale, rent, electric bill, taxes, etc. Okay, that's a big \"\"one thing\"\". 2: Every transaction must update two or more accounts. Each update is either a \"\"debit\"\" or a \"\"credit\"\". The total of the debits must equal the total of the credits. 3: A dollar bill in your pocket is a debit. With a little thought (okay, sometimes a lot of thought) you can figure out everything else from there.\"" }, { "docid": "304662", "title": "", "text": "The fact that your credit card has seen the payment is strong evidence that the transaction did in fact take place. But it's not unusual for there to be a delay of one or two business days before transactions show up in your online banking records. Saturday and Sunday are not business days. I bet you will see it on Monday. If it's not there by Tuesday, you could call the bank." }, { "docid": "536759", "title": "", "text": "How you can pay your rent is really up to your landlord. They are, however, unlikely to take a credit card, for at least two reasons. Firstly they are unlikely to have the means to take electronic payment Second, and more importantly, merchants get charged a percentage of the transaction. These fees can be quite high to them for premium cards like travel and gold cards; three, four or even five percent of the value of the transaction. This is sometimes why you see cash discounted pricing." }, { "docid": "546874", "title": "", "text": "\"Banks are in it to make money. But they're expected to provide a social good which powers our economy: secure money storage (bank accounts) and cashless transactions (credit/debit cards). And the government does not subsidize this. In fact, banks are being squeezed. Prudent customers dislike paying the proper cost of their account's maintenance (say, a $50/year fee for a credit card, or $9/month for a checking account) - they want it free. Meanwhile government is pretty aggressive about preventing \"\"fine print\"\" trickery that would let them recover costs other ways. However there isn't much sympathy for consumers who make trivial mistakes - whether they be technical (overdraft, late fee) or money-management mistakes (like doing balance transfers or getting fooled by promotional interest rates). So that's where banks are able to make their money: when people are imprudent. The upshot is that it's hard for a bank to make money on a prudent careful customer; those end up getting \"\"subsidized\"\" by the less-careful customers who pay fees and buy high-margin products like balance transfers. And this has created a perverse incentive: banks make more money when they actively encourage customers to be imprudent. Here, the 0% interest is to make you cocky about running up a balance, or doing balance transfers at a barely-mentioned fee of 3-5%. They know most Americans don't have $500 in the bank and you won't be able to promptly pay it off right before the 0% rate ends. (or you'll forget). And this works - that's why they do it. By law, you already get 0% interest on purchases when you pay the card in full every month. So if that's your goal, you already have it. In theory, the banks collect about 1.5% from every transaction you do, and certainly in your mind's eye, you'd think that would be enough to get by without charging interest. That doesn't work, though. The problem is, such a no-interest card would attract people who carry large balances. That would have two negative impacts: First the bank would have to spend money reborrowing, and second, the bank would have huge exposure to credit card defaults. The thing to remember is the banks are not nice guys and are not here to serve you. They're here to use you to make money, and they're not beneath encouraging you to do things that are actually bad for you. Caveat Emptor.\"" }, { "docid": "79453", "title": "", "text": "Automated Clearing House transactions are used in the US for direct deposit of pay checks and direct debit of many payments for accounts such as mortgages, credit cards, car loans, insurance premiums, etc. The reason they take one or more business days to clear is that the transactions are accumulated by each processor in the network during the day and processed as a batch at the end of each business day. The ACH network processes 20+ billion transactions per year worth $40 trillion, (estimates based on 2012 figures)." }, { "docid": "280699", "title": "", "text": "They represent two distict payment processing mechanisms that just happen to be available on one product. Rather like having dvi and hdmi on you laptop. Your account number and sort code relates to the bank account. Your long number, expiry and ccv relate to the card. It is perfectly possible and not uncommon to have two different cards on the same account, which would have their own card numbers etc. The BACS, CHAPS, DirectDebit and FasterPayments systems use the account numbers. These transactions are practically irreversible and work through the interbank transfer system and should be considered 'direct money transfers' - electronic cash. The long digits are used by Mastercard, Visa, AmEx etc and go through their own payment systems. These payments are 'indirect' and may or may not be reversible as the private payment network (visa etc) has some accountability. They work like electronic cheques. This is why debit card transactions can cause you to go overdrawn - you are writing a promise to pay from an account. It is up to the bank to block the card if you have no money, vs a CHAPS payment that checks the money is there before moving it. It is easier (but still hard) to recover money lost through Visa fraud than BACS. Credit cards have only the long number etc. While savings accounts (non-checking accounts) have only account numbers. Depending on where you are different laws will likely cover debit card vs money transfer payments. In the UK Direct debit guarantee is the most common protection on the BACS system, while standing orders and faster payments give you little legal power. Debit cards will give you some protection because the payment system stands between you and the bank account, so if you didn't make the transaction you should be able to reclaim the money ('card not present fraud'). If you did make the transaction but the vendor failed to supply or goods were faulty then a Chargeback system exists where you may also be able to reclaim. A bank transfer you make is irrecoverable and refund can only be claimed through court for faulty goods." }, { "docid": "5607", "title": "", "text": "\"Here is how the Visa network works: A Visa transaction is a carefully orchestrated process. When a Visa account holder uses a Visa card to buy a pair of shoes, it’s actually the acquirer — the merchant’s bank — that reimburses the merchant for the shoes. Then, the issuer — the account holder’s bank — reimburses the acquirer, usually within 24 to 48 hours. Lastly, the issuer collects from the account holder by withdrawing funds from the account holder’s bank account if a debit account is used, or through billing if a credit account is used. I read this to mean the Merchant's Bank (the Acquirer Bank) gives the merchant the money within 2 days via the Card Issuer's Bank. The issuing bank is the one that provides the \"\"credit\"\" feature since that bank won't get reimbursed until the shopper's bill is paid (or perhaps even longer if the shopper carries a balance). You'll notice the Credit Card company (Visa/MC/etc) is only involved in the process as a way of passing messages. Of course they take a fee for this service so seller ultimately get's less than the buyer bought the shoes for.\"" }, { "docid": "84036", "title": "", "text": "\"Ditto Nate Eldredge in many ways, but let me add some other thoughts. BTW there are not four types of account, but five. You're forgetting equity, also called capital. Would it be possible to design an accounting system that does not have 5 types of accounts, maybe is simpler in other ways, and is internally consistent and logical? I'm sure it is. But what's the advantage? As Nate points out, the existing system has been in use for hundreds of years. Lots of people know how it works and understand it. I'd add: People have long since worked out how to deal with all the common situations and 99% of the odd cases you're likely to hit. If you invent your own system, you're starting from scratch. You'd have to come up with conventions to handle all sorts of situations. How do I record buying a consumable with cash? How do I record buying a capital asset with credit? How do I record paying off debts? How do I record depreciation? Etc etc. If you worked at it long and hard enough and you're a reasonably bright guy, maybe you could come up with solutions to all the problems. But why? If you were approaching this saying, \"\"I see these flaws in the way accounting is done today. I have an idea for a new, better way to do accounting\"\", I'd say good luck, you have a lot of work ahead of you working out all the details to make a fully functioning system, and then persuading others to use it, but if you really do have a better idea, maybe you can revolutionize the world of accounting. But, \"\"The present system is too much trouble and I don't want to bother to learn it\"\" ... I think that's a mistake. The work involved in inventing your own system is going to end up being way more than what it would take to learn the existing system. As to, Aren't liabilities a lot like assets? Well, in a sense I suppose. A credit card is like a checking account in that you can use it to pay for things. But they're very different, too. From an accounting point of view, with a checking account you buy something and then the money is gone, so there's one transaction: reduce cash and increase office supplies or whatever. But with a credit card there has to be a second transaction, when you pay off the charge: So, step 1, increase debt and increase office supplies; step 2, decrease debt and decrease cash. Credit cards charge interest, well you don't pay interest to use your own cash. Etc. One of the beauties of double-entry book-keeping is that every transaction involves a debit and a credit of equal amounts (or a set of debits and credits where the total of the debits equals the total of the credits). If you combine assets and liabilities into, whatever you call it, \"\"balance accounts\"\" say, then some transactions would involve a matching debit and credit while others would involve a positive debit and a matching negative debit and no credit. I'm sure you could make such a system work, but one of the neat built-in protections against error is lost. There's a very logical distinction between things that you have or that others owe you, and things that you owe to others. It makes a lot of sense to want to list them separately and manage them separately. I think you'd pretty quickly find yourself saying, \"\"well, we have two types of balance accounts, those that represent things we have and which normally have positive balances, which we list on chart A, and those that represent things we owe and which normally have negative balances, which we list on chart B\"\". And before you know it you've just reinvented assets and liabilities.\"" }, { "docid": "75097", "title": "", "text": "From Chase FAQ it looks like this is a regular ACH transfer. ACH transactions can be reversed under certain conditions. I haven't been able to find some authoritative link on this, so I suggest this (thenest.com budgeting blog) instead: Allowed Reasons You can have ACH transactions reversed for one of three reasons under the rules: wrong money amount, wrong account or duplicated transactions. For example, if your mortgage bill is for $756.00, but your lender's website messes up and you're charged $856.00, the transaction is reversible it because it's the wrong dollar amount. If the website charges you $756.00 twice, the second duplicated transaction is reversible. Reversal Procedures You might have to bring a mistake to the originator's attention to get it fixed. Only the originator -- the person or company taking or sending money -- can ask for a reversal. For example, if you have a transaction for a wrong dollar amount from your lender's website, the originator is the lender. An originator is supposed to send the reversal within 24 hours of the error's discovery and within five banking days of the original transaction. When a reversal is required because of a wrong amount or wrong account, the originator must send a correcting entry with the right information. Bank's Responsibility A bank should honor an ACH reversal, even if it means debiting a customer's account again because of a correcting transaction. However, the bank doesn't have to debit your account if you closed it or the new transaction would overdraw it. Your bank does have to tell you if a correcting entry is going to take money out of your account, but the bank doesn't need your permission to do it." }, { "docid": "408628", "title": "", "text": "Account statements and the account information provided by your personal finance software should be coming from the same source, namely your bank's internal accounting records. So in theory one is just as good as the other. That being said, an account statement is a snapshot of your account on the date the statement was created, while synchronizations with your personal finance application is dynamically generated upon request (usually once a day or upon login). So what are the implications of this? Your account statement will not show transactions that may have taken place during that period but weren't posted until after the period ended (common with credit card transactions and checks). Instead they'd appear on the next statement. Because electronic account synchronizations are more frequent and not limited to a specific time period those transactions will show up shortly after they are posted. So it is far easier to keep track of your accounts electronically. Every personal finance software I've ever used supports manual entries so what I like to do is on a daily basis I manually enter any transaction which wasn't posted automatically. This usually only takes a few minutes each evening. Then when the transaction eventually shows up it's usually reconciled with my manually entered one automatically. Aside from finding (infrequent) bank errors this has the benefit of keeping me aware of how much I'm spending and how much I have left. I've also caught a number of cashier errors this way (noticing I was double-charged for an item while entering the receipt total) and its the best defense against fraud and identity theft I can think of. If you're looking at your accounts on a daily basis you're far more likely to notice an unusual transaction than any monitoring service." }, { "docid": "102002", "title": "", "text": "Is it normal in QuickBooks to have credit card expenses being shows as liabilities? Is there a way I can correct this? If they are expenses they shouldn't be negative liabilities unless you overpaid your credit card by that amount. It sounds like perhaps when you linked the account the credit/debit mapping may have been mixed up. I've not used QB Online, but it looks like you might have to un-link the account, move all the existing transactions to 'excluded' and then link the account again and flip-flop the debit/credit mapping from what it is now. Hopefully there's an easier way. This QB community thread seems to address the same issue." }, { "docid": "28074", "title": "", "text": "\"As anecdotal experience, we have a credit account in my name as offered by bank's marketing before I could qualify by common rules for newcomers (I have an account there for years so they knew my history and reliability dynamics I guess), and my wife is subscribed as a secondary user to the same credit account with a separate card. So we share the same limits (e.g. max month usage/overdraft) and benefits (bank's discounts and bonuses when usage passes certain thresholds - and it's easier to gain these points together than alone) so in the end maintenance of the card costs zero or close to that on most months, while the card is in a program to get discounts from hundreds of shops and even offers a free or discounted airport lounge access in some places :) But the bonus program is just that - benefits come and go as global economics changes; e.g. we had free car assistance available for a couple of years but it is gone since last tariff update. Generally it is beneficial for us to do all transactions including rent etc. via these two credit cards to the same account, and then recharge its overdraft as salaries come in - we have an \"\"up to 50 days\"\" cooloff period (till 20th of next calendar month) with no penalties on having taken the loans - but if we ever did overstretch that, then tens of yearly percents would kick in. Using the card(s) for daily ops, there is a play on building up the credit history as well: while we don't really need the loans to get from month to month, it helps build an image in the face of credit organizations, which can help secure e.g. favorable mortgage rates (and other contract conditions) which are out of pocket money range :) I'd say it is not only a \"\"we against the system\"\" sort of game though, as it sort of trains our own financial discipline - every month we have (a chance) to go over our spendings to see what we did, and so we more regularly think about it in the end - so the bank probably benefits from dealing with more-educated less-random customers when it comes to the bigger loans. Regarding internet, we tend to trust more to a debit card which we populate with pocket money sufficient for upcoming or already placed (blocked) transactions. After all, a malicious shop can not sip off thousands of credit money - but only as much as you've pre-allocated there on debit.\"" }, { "docid": "294899", "title": "", "text": "Credit cards and debit cards make up the bulk of the transactions in the US. Visa and Mastercard take a percentage of each credit card transaction. For the most part, this fee it built into the price of what you buy. That is, you don't generally pay extra at the grocery store if you use a credit card (gasoline purchases are a notable exception here.) If you were getting something like 2% of a third of all the retail transactions in the US, you'd probably not want to rock the boat too much either. Since there is little fraud relative to the amount of money they are taking in, and it can often be detected using statistical analysis, they don't really stand to gain that much by reducing it through these methods. Sure they can reduce the losses on the insurance they provide to the credit card consumer but they risk slowing down the money machine. These companies want avoid doing something like reducing fraud by 0.5% revenues but causing purchases with the cards drop by 1%. More security will be implemented as we can see with the (slow) introduction of chip cards in the US but only at a pace that will prevent disruption of the money machine. EMV will likely cause a large drop in CC fraud at brick-and-mortar stores but won't stop it online. You will likely see some sort of system like you describe rolled out for that eventually." }, { "docid": "282934", "title": "", "text": "\"As stated in the other answer, debit card payments even contactless ones, do not debit instantly or anywhere near instantly. They can take several days or even longer. However, the fact that the payment was approved would indicate that the contactless device used by the retailer managed to connect to your bank account and could see there were sufficient funds. At this time the payment should also have \"\"reserved\"\" the funds so it will be \"\"pending\"\" as such. Your online banking may not show all types of pending transactions, it may only show Direct Debits for example, if you ring the bank I expect they will be able to see this payment and advise accordingly, out of interest who do you bank with? If you can see your \"\"available\"\" funds you should find that includes this payment having been \"\"reserved\"\" ie you can't use that money, but if it's a small amount you may struggle to spot it. Again, this will vary by bank and how their internet banking system has been implemented. I would expect this payment to debit your account the working day after you made it, or at worst the day after that. In theory with \"\"faster payment\"\" technology it could happened within 2 hours but not all banks implemented that system in the same way so delays can and do occur. If the retailer/merchant banks with the same bank you do, in theory the transaction could be instantaneous, again depending on the bank. Short answer short, the transaction is fine, it won't be void, you just need to wait, probably a day or two. This link has more info, especially useful if you bank with NatWest (as I say the technology is likely to vary by bank to some extent). Your own bank should have their own version of this. http://personal.natwest.com/personal/current-accounts/your-visa-debit-card/contactless.html\"" }, { "docid": "185403", "title": "", "text": "Believe it or not, this is done as a service to you. The reason for this has to do with a fundamental difference between a credit card account and a checking account. With a credit card account, there is no money in the account; every charge is borrowed money. When you get to your credit limit, your credit transactions will start getting declined, but if the bank does for some reason let one get approved, it's not a big deal for anyone; it just means that you owe a little more than your credit limit. Note that (almost) every credit card transaction today is an electronic transaction. A checking account, however, has real money in it. When it is gone, it is gone. When a balance inquiry is done, the bank has no way of knowing how many checks you've written that have not been cashed yet. It is a customer's responsibility to know exactly how much money is available to spend. If you write more checks than you have money for in your account, technically you have committed a crime. Unfortunately, there are too many people now that are not taking the responsibility of calculating their own checking account balance seriously, and bad checks are written all the time. When a bank allows these transactions to be paid even though you don't have enough money in your account, they are preventing a crime from being committed by you. The fee is a finance charge for loaning you the money, but it is also there to encourage you not to spend more than you have. Even if you use a debit card, it is still tied to a checking account, and the bank doesn't know if you have written enough checks to overdraw your account or not. It is still your responsibility to keep track of your own available balance. Every time this happens to you, thank the bank as you pay this fee, and then commit to keeping your own running balance and always knowing how much you have left in your account." }, { "docid": "15824", "title": "", "text": "\"The danger of overdrawing the account via the use of a debit card, and the exorbitant fees that can result make me hesitant to use a debit card. The ability to cover all the transactions with one payment is why I use a credit card for these \"\"debit\"\" transactions. Yes there is a risk of a late payment, but that can be easily avoided within the three week grace period. The ability to electronically transfer the money to pay off the card makes this even easier.\"" } ]

[ { "docid": "297588", "title": "", "text": "Not doing this would defeat the entire purpose of a VAT. The reason for a VAT rather than a simple sales tax is that it's harder to evade. Having a simple sales tax with the type of rates that VAT taxes typically are is unworkable because evasion is too easy. Imagine I'm a retailer. I buy products from a wholesaler and sell them to consumers. With a sales tax, if I don't charge the customer sales tax, the customer is happy and I don't care (assuming I don't get caught). And if I keep the sales tax but don't report the sale, I make a lot of money. Now, imagine a VAT. If I don't charge the customer the VAT, I lose money since I paid the VAT on the wholesale products. And if I don't report the sale, how do I claim my VAT refund?" } ]

[ { "docid": "464385", "title": "", "text": "I was just thinking ahead, can I apply for Limited company now, while fully time employed, and not take any business until I get a contract. Yes. You can open as many companies you want(assuming you are sane). There is no legal provisions regarding who can open a company. What happens if I create a company and it has no turnover at all? Does this complicate things later? After you open a company, you have to submit your yearly statements to Companies House, whether you have a billion pounds turnover or 0. If you claim VAT that has also to be paid after you register for VAT. VAT registration is another registration different from opening a limited company. Is it the same if I decided to take a 1,2 or x month holiday and the company again will not incur any turnover? Turnover is year end, so at the year end you have to submit your yearly results, whether you took a 12 month holiday or a week's holiday. Is it a OK to do this in foresight or should I wait weeks before actually deciding to search for contracts. No need to open a limited company now, if you are so paranoid. Opening a company in UK takes 5 minutes. So you can open a company after landing a contract." }, { "docid": "452248", "title": "", "text": "It is a great advice. I would suggest going to the Companies House (it's in London somewhere), picking up all of their leaflets regarding requirements for different forms of corporate entity, and deciding if you want to have that burden. It is not a lot of work, you can essentially claim VAT on all business purchases (the way roughly it works, is that your company invoices your client, your client has to pay the fee + VAT (usually that VAT is then deducted by your client from it's VAT, so no loss there), and you pay the VAT on the difference between the service sales price, and your costs (computers etc.) ) You have to be careful to avoid excessive double taxation (paying income tax on both corporate income, and then your personal income off said company), but it usually comes off in your favor. Essentially, if you're making more than 50% of your income from services rendered, it is to your advantage to render such services as a business entity." }, { "docid": "338278", "title": "", "text": "Are corporations not already passing along the cost of healthcare to the consumer? When the employer pays, directly, for the employees health insurance, it goes directly into overhead costs. Goods and service costs have to rise to meet that. It's already happened. Ideally, the healthcare savings would just offset the VAT. Employee salaries probably wouldn't increase any, even ideally." }, { "docid": "182168", "title": "", "text": "It's not quite clear what you are asking, so I'll answer a few possible interpretations. Businesses pay taxes on their profits. So if your business took a million pounds in revenue (e.g. sold a million pounds worth of stuff) then you would subtract (roughly speaking) everything the business spent on making and selling that stuff, and pay taxes only on the profit. VAT however is a different matter, and you would have to pay VAT on all of that income (technically the VAT portion isn't even income - it's tax you are forced to collect on behalf of the government). If your business made a million pounds pounds profit, it would pay tax on all of that million (subject to what a tax accountant can do to reduce that, which ought to be considerable). You can't subtract your personal living expenses like that. However the company can pay you a salary, which counts as an expense and the company doesn't pay tax on that. You might also take some money from the company as dividends. Both salary and dividends count as personal income to yourself, and you will need to pay personal income tax on them. As for the Ferrari, it depends on whether you can justify it as a business expense. A lot of companies provide cars for their employees so that they can use them for business - however you have to be able to show that IS for business, otherwise they are taxed like salary. The rules for company cars are quite complicated, and you would need an accountant. If this is a real rather than hypothetical situation, definitely get a tax accountant involved." }, { "docid": "546299", "title": "", "text": "Sales taxes are charged at the point of purchase, while a VAT is assessed during the production process of the item. In the end, the amount paid by the consumer is the same, but with the VAT, the tax was collected from the manufacturer, instead of the consumer. One of the big arguments for VAT is that it prevents lost revenue due to things like smuggling (if sales tax increases past 10% smuggling spikes, so the VAT is a good mechanism if you're looking to implement large taxes on goods). It also keeps the tax burden away from shippers and other tiers of the production process that don't change the intrinsic value of the item." }, { "docid": "196308", "title": "", "text": "In the EU prices on consumer-focussed sites* are quoted inclusive of VAT. In the USA prices are quoted exclusive of sales tax. Consumer pricing is usually driven at least partly by psychological concerns. Some pricepoints are more appealing to certain types of buyers than others. The Euro vs dollar exchange rate has fluctuated a bit over the years but it's generally averaged somewhere around 1.2 dollars per Euro over the last decade. VAT has varied around 15%-20% in most cases. Put these things together and the same headline price points are generally appropriate in both the USA and the Eurozone. OTOH the Brisith pound has been worth substantially more than the dollar or the Euro. So it makes sense to have a lower headline price in the UK. * B2B focussed sites often quote prices exclusive of VAT, you need to be aware of this when comparing prices." }, { "docid": "290383", "title": "", "text": "\"Perhaps you can track your VAT amounts in a Liability account. Using a tax liability account is a common thing in accounting. To do this, when you receive money, split the transaction such that your actual revenue (which you will keep after VAT remittance) goes into an Asset account, and the amount you will eventually have to pay back to the state goes into a Liability account. Later, when you pay the VAT back to the state, your transaction will effectively \"\"pay back\"\" the liability, with one end of your double-entry decreasing the funds in your checking account, and the other end decreasing the funds in your tax liability account. Having said that, I've found that there are many shortcomings in the Cash Flow report, and I'm not sure that using a tax liability account (which I think is the Right Thing to do) will necessarily solve this problem for you...\"" }, { "docid": "232063", "title": "", "text": "Some items are VAT Exempt or Reduced, but in short you will pay it on almost any all consumer goods. Assuming you are a visitor to the UK from a non-EU nation then Her Majesty will refund you with the appropriate paperwork" }, { "docid": "309909", "title": "", "text": "Are you allowed to have two personal current accounts with a debit card attached to each one? Yes, you may have as many current accounts you want, but you should ask why should I have more than one. It is cumbersome and time consuming to keep track of ongoing incoming credits and outgoing debits. Open to bank fraud too, if you aren't careful. If yes, can a sole trader in the UK use the second personal account for business transactions? Yes, but no payments to the business. At the end of the year you file you P11D, even if you have a business bank account. You would need to justify the expenses by keeping the bills and stuff. As it will be a personal account, you have to little more careful, not to mix personal and business expenses. If you are allowed to use a second personal account for business transactions, then why would someone choose to open a business bank account, where you have to pay? What are the benefits? First of all no company will pay into you personal account, for any transactions, they need to pay you. They will only pay to an account registered with the business, with whom they are dealing with. Benefits are you have your business expenses sorted out in one account and personal expenses in other. Pure business expenses comes out of the business account, rather than from your personal purse, keeps the accounts smooth. No need to sort out expenses at the end of each quarter or at the end of each month." }, { "docid": "325576", "title": "", "text": "Of course this ignores that fact the companies remit some pretty hefty VAT (Value Added Taxes) when they sell all there stuff. There is a 20% VAT on what they sell, then subtract the VAT of the stuff they buy, and I'll ballpark they are sending a good 10% of Gross (So 300 million Pounds) to Her Majesty's Treasury every year. Not bad for selling overpriced coffee." }, { "docid": "544995", "title": "", "text": "Yes if you do it as a hobby, as it's still income. But it should be something you can offset against tax Either way, you shouldn't be doing this as you, you should either register as self employed or create a company. You register this income as self-employed income (or income of the company) and offset the expenses of running the server against tax. In the UK, companies (or self employed people, which are basically companies) pay tax on profit not income (unless VAT applies, in which case they're basically just passing the VAT on for their customers). Since you're not making a profit over the whole year (even if some months are profitable) you will pay no tax." }, { "docid": "202767", "title": "", "text": "So, my econ 101 class taught me that a business operating at a point where revenue equals cost is successful. Failing is when costs are too high, and above that is profit. As a society, we've chose to tax profits, not revenue. The fact that many of Amazon's vendors (FedEx, ups, companies they buy hardware from, etc) are profitable and paying taxes on profits they wouldn't have without Amazon says something about the overall value they bring to the economy. Also, states collect sales tax on good sold. EU countries collect VAT. And all countries collect capital gains when shares change hands. The fact that there's low turnover in shares isn't really a problem." }, { "docid": "110515", "title": "", "text": "The way I see it, corporation tax is not fundamentally different from VAT. They are both a tax on revenue minus expenses, just what those expenses are is different. I think the main advantage of corporation tax is that it allows capital expenditure to be spread over several years, although as I said this makes it more complicated (and I believe that there are some capital allowances for VAT as well). One advantage of VAT is that sales in one country are taxed in that country before the money can be sent abroad. It seems simple and fair to split the tax burden between jurisdictions according to how many sales were made in each." }, { "docid": "433801", "title": "", "text": "Note: I am not a lawyer. This is my personal opinion and interpretation. First, your source is European Law, which obviously doesn't apply outside of the EU. The EU cannot make laws that bind entities in other countries; so you cannot claim that the VAT was needed to be mentioned. Second, if you owe something, you owe it; it doesn't matter if it was forgotten to be mentioned. At best, you can say that under those circumstances you don't want the software anymore, and i would assume you can send it back and get your money back (minus a fee for having it used for a while...) - this gets quite difficult to calculate clearly, so it's probably not a good avenue to follow for you. As the company has to send the VAT to your country (they will not be allowed to keep a dime of it, and have to bear the complete cost for the handling), it is a debt you have to your government; they are just the entity responsible for collecting it. Still, if you just ignore them, they will probably suck it up, and your government will also not do a thing to you. If they only have your email address, they have no way of knowing if you even still have/use this address; for all they know, it could be you never got it. They also cannot simply charge your card, as they probably don't have the card data any more (they are not supposed to keep it after the transaction is complete, and they thought it was complete at the time). All in all, you should be safe to ignore it. It's between you and your god/consciousness, if you feel obliged to pay it, as technically you owe it." }, { "docid": "229293", "title": "", "text": "If the VAT is offset by not having to pay for employees health insurance, then I wonder what net effect it would have on goods? Also, if the employees are no longer paying for their share of the employer funded health insurance, then that would, effectively, be more money in the employees pockets. You're right though, it all comes down to what the numbers look like." }, { "docid": "219940", "title": "", "text": "All this speculation and no one really has the right idea what's going on. It has almost nothing to do with VAT and nothing to do compliance. [It has everything to do with a very a chronically weak Euro.](https://www.google.com/finance?client=safari&amp;rls=en&amp;q=eur&amp;oe=UTF-8&amp;um=1&amp;ie=UTF-8&amp;sa=N&amp;tab=we) Apps in the App Store are tied to tiers. My app sells at tier 10. For USD, this means I sell my app for $10 and make $7 after their cut. Tier 10 used to translate to 7,99€. Now it's 8,99€. This means before the hike I, as an American, would get 4,79€ or $6.19 after the exchange. This wasn't a problem back when the app store opened. The economy was relatively strong and the Euro stood around 1.5 to one American dollar. This means in 2008 I'd get about the same $7 after the conversion. With the Euro crisis, the tiers remained the same which meant each European sale only netted around $5.75, a $1.25 discount for each European. The Euro conversion was a long standing issue and the price hike restores the exchange back to the $7 dollars it used to be." }, { "docid": "317570", "title": "", "text": "I see a couple of ways of getting at this. One would be to switch to a VAT. That would capture a good amount of revenue on anything that's made here. Second, I want IP to be taxed. We pay property taxes, so I think that trademarks and copyrighted works should be taxed just like how real property is taxed. You want to register the Burger King logo in the US? Sure thing! You will pay a percentage of its value every year and you get to use it exclusively with the full protection of the US courts your taxes help fund. I also see this as a good way out of the IP cesspool we're currently in. Copyright has become unreasonably long mostly because Disney doesn't want to lose the rights to Mickey Mouse. Look, I *am* sympathetic to Disney's argument. Mickey genuinely is important to them. But Mickey is fucking things up for everyone else. So I think Disney should pay a percentage of Mickey's value every year. In exchange, they keep their copyright forever as long as they keep paying. Now, if the copyright tax isn't paid, then the property becomes public domain forever. This would let Disney have what they want while non-profitable copyrights become public domain, as they should. Anyhow, the one thing all the big tax-avoiding companies have in common is IP. If you tax their IP in exchange for protection in US courts, there's really no way around that. They will either have to pay or let their IP go public domain." }, { "docid": "246345", "title": "", "text": "This doesn't explain the methodology used, but it appears to only include national taxes on wage income for the middle class. Do these European countries have the equivalent of state and local taxes? Do they have sales tax or VAT? Property taxes? The American tax system is uniquely cumbersome and complicated to the point where even tax experts don't understand all of it. I highly doubt whichever method was used in this study accurately represents the tax burden on Americans, but I can't say for sure since that article doesn't share its methodology." }, { "docid": "484352", "title": "", "text": "\"11 / 111 / 11111 looks like the (old) tax number: it is used by the tax office to know who you are, it isn't good at all for the spanish company. It would even change when you move inside Germany. VAT IDs are not exclusive to GmbHs (but a GmbH always has one). As freelancers you can get at VAT ID but you don't always have to. The tax office offers a \"\"small business\"\" treatment (§ 19 UStG) for freelancers, kind of an opt-out for the VAT ID. As you do not have a VAT ID, this is probably your case. It means So what to do? If I were you, I'd write them that according to §19 UStG and the European Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax, TITLE XII CHAPTER 1 \"\"Special scheme for small enterprises\"\" you were not assigned a VAT ID, and VAT is not applicable to your bill. The fact that VAT is not applicable in this case does not mean that they are allowed to refuse payment. I heard a rumour (but don't really know) that a number similar to the VAT ID is planned also for freelancers (Wirtschafts-IDNr.). You could go to your tax office and ask them about. Maybe that yields a number that satisfies spanish burocracy. AFAIK, you can go to your tax office and ask them to give you a real VAT number. But careful: that has the serious drawback that you have to do do an advance VAT estimate and pay that to the tax office at least quarterly (for bigger business monthly). And (AFAIK) you are not allowed to change back to the small business treatment for several years.\"" } ]

[ { "docid": "357079", "title": "", "text": "But why can't two companies exchange goods directly without paying VAT? This would make the famous carousel fraud scam impossible and businesses won't have to deal with complicated refunds. Sales tax in the United States works as you describe. Sales tax is charged only to end customers, not to businesses that themselves charge sales tax. But this means that a criminal business can charge tax and just pocket it unless someone else reports it. They can also evade income tax the same way. Not to mention other issues like cross jurisdiction taxes (e.g. internet sales often evade sales tax). The whole point of a Value Added Tax (VAT) is that they charge at each level. This creates a system where each buyer reports the tax paid to the seller so as to be able to deduct it. So the seller has to pay the VAT that they charged. Or the tax authorities know and can revoke their VAT license. If only the end user is charged tax, then fraud is easier than under a VAT. So easy, I doubt they have a special name for it. The fraudulent business just collects tax from end users and disappears. Or simply fails to record those transactions. You could call it missing transaction record fraud, but why bother? It's just straight up tax fraud. The complexity of the carousel fraud arises from the difficulty of evading a VAT." } ]

[ { "docid": "357820", "title": "", "text": "As far as taxes are concerned, if your income is €10 to €20 a month, the Finanzamt doesn't even want to hear from you. To be on the safe side, give them a call and you will probably be told that there is a minimum amount, and if your revenue is below that you don't have to do anything. As far as VAT (MwSt) is concerned: You can only deduct it from VAT that you would have to pay to the government. If you are supposed to pay €100 VAT to the government, you can deduct up to €100 VAT paid to suppliers. If you don't pay VAT, you can't deduct it." }, { "docid": "338278", "title": "", "text": "Are corporations not already passing along the cost of healthcare to the consumer? When the employer pays, directly, for the employees health insurance, it goes directly into overhead costs. Goods and service costs have to rise to meet that. It's already happened. Ideally, the healthcare savings would just offset the VAT. Employee salaries probably wouldn't increase any, even ideally." }, { "docid": "164427", "title": "", "text": "Source:- Registering for VAT You must register for VAT with HM Revenue and Customs (HMRC) if your business’ VAT taxable turnover is more than £82,000. You can register voluntarily if it’s below this, unless everything you sell is exempt." }, { "docid": "547653", "title": "", "text": "I don't think so, but: - It depends on the product, some products are simple (Vodka) others have plenty of restrictions (Plutonium). So without you naming what your product is nobody can help you. - Regulation differ for each country. Greece and Italy are different countries. For most products you pay some import duty, the applicable VAT and some customs fees and all is well." }, { "docid": "516859", "title": "", "text": "since it opened in the UK in 1998 the company has racked up over 3 billion pounds ($4.8 billion) in coffee sales So wouldn't that mean they generated almost $1B in VAT for the government? Not to mention all the income tax their employees pay?" }, { "docid": "151946", "title": "", "text": "\"Legally speaking, when you convert that bit-coin onto something else, the Israeli Tax Authority will look into the value of that something else, compare it to the original value of the previous something else you used to buy bit-coins (USD, in your example), and charge you capital gain taxes for the difference. According to the Israeli law you're supposed to pay taxes when selling (converting the bit-coin to something else), and since you're not using any formal bank or stock broker which will automatically deduct the taxes, you have to pay the taxes yourself. By not doing so you're committing a tax fraud. The real question you're asking is whether they'll come after you. Well, that depends on the amounts. They might. Pay attention: there's no statute of limitation for tax fraud in Israel. They may come after you in 50 years from now. Another thing to keep in mind: if you used bit-coins to buy something (services or products of any kind), you probably didn't pay the VAT (מע\"\"מ) - which is another case of tax fraud on your behalf. PS: I'm not a lawyer or accountant, so get a professional advice, but I have been dealing with the Tax Authority in Israel, so I've got a pretty good idea of what the rules are.\"" }, { "docid": "196308", "title": "", "text": "In the EU prices on consumer-focussed sites* are quoted inclusive of VAT. In the USA prices are quoted exclusive of sales tax. Consumer pricing is usually driven at least partly by psychological concerns. Some pricepoints are more appealing to certain types of buyers than others. The Euro vs dollar exchange rate has fluctuated a bit over the years but it's generally averaged somewhere around 1.2 dollars per Euro over the last decade. VAT has varied around 15%-20% in most cases. Put these things together and the same headline price points are generally appropriate in both the USA and the Eurozone. OTOH the Brisith pound has been worth substantially more than the dollar or the Euro. So it makes sense to have a lower headline price in the UK. * B2B focussed sites often quote prices exclusive of VAT, you need to be aware of this when comparing prices." }, { "docid": "202767", "title": "", "text": "So, my econ 101 class taught me that a business operating at a point where revenue equals cost is successful. Failing is when costs are too high, and above that is profit. As a society, we've chose to tax profits, not revenue. The fact that many of Amazon's vendors (FedEx, ups, companies they buy hardware from, etc) are profitable and paying taxes on profits they wouldn't have without Amazon says something about the overall value they bring to the economy. Also, states collect sales tax on good sold. EU countries collect VAT. And all countries collect capital gains when shares change hands. The fact that there's low turnover in shares isn't really a problem." }, { "docid": "433801", "title": "", "text": "Note: I am not a lawyer. This is my personal opinion and interpretation. First, your source is European Law, which obviously doesn't apply outside of the EU. The EU cannot make laws that bind entities in other countries; so you cannot claim that the VAT was needed to be mentioned. Second, if you owe something, you owe it; it doesn't matter if it was forgotten to be mentioned. At best, you can say that under those circumstances you don't want the software anymore, and i would assume you can send it back and get your money back (minus a fee for having it used for a while...) - this gets quite difficult to calculate clearly, so it's probably not a good avenue to follow for you. As the company has to send the VAT to your country (they will not be allowed to keep a dime of it, and have to bear the complete cost for the handling), it is a debt you have to your government; they are just the entity responsible for collecting it. Still, if you just ignore them, they will probably suck it up, and your government will also not do a thing to you. If they only have your email address, they have no way of knowing if you even still have/use this address; for all they know, it could be you never got it. They also cannot simply charge your card, as they probably don't have the card data any more (they are not supposed to keep it after the transaction is complete, and they thought it was complete at the time). All in all, you should be safe to ignore it. It's between you and your god/consciousness, if you feel obliged to pay it, as technically you owe it." }, { "docid": "381830", "title": "", "text": "The VAT number should be equivalent from the point of view of your client. The fact that you are a sole trader and not a limited liability doesn't matter when it comes down to pay VAT. They should pay the VAT to you and you will pay it to the government. I'll guess that their issue is with tax breaks, it is a bit more tricky to receive a tax break on paid taxes if you buy something abroad (at least it is here in Finland). If they won't pay you because of that, you could open a LTD or contract the services of a 'management company' which will do the job of invoicing, receiving the money and passing it back to you, for a fee." }, { "docid": "182168", "title": "", "text": "It's not quite clear what you are asking, so I'll answer a few possible interpretations. Businesses pay taxes on their profits. So if your business took a million pounds in revenue (e.g. sold a million pounds worth of stuff) then you would subtract (roughly speaking) everything the business spent on making and selling that stuff, and pay taxes only on the profit. VAT however is a different matter, and you would have to pay VAT on all of that income (technically the VAT portion isn't even income - it's tax you are forced to collect on behalf of the government). If your business made a million pounds pounds profit, it would pay tax on all of that million (subject to what a tax accountant can do to reduce that, which ought to be considerable). You can't subtract your personal living expenses like that. However the company can pay you a salary, which counts as an expense and the company doesn't pay tax on that. You might also take some money from the company as dividends. Both salary and dividends count as personal income to yourself, and you will need to pay personal income tax on them. As for the Ferrari, it depends on whether you can justify it as a business expense. A lot of companies provide cars for their employees so that they can use them for business - however you have to be able to show that IS for business, otherwise they are taxed like salary. The rules for company cars are quite complicated, and you would need an accountant. If this is a real rather than hypothetical situation, definitely get a tax accountant involved." }, { "docid": "233702", "title": "", "text": "Can I apply for limited company now, while fully time employed, and not take any business until I get a contract? Some employment contracts may include non-compete clauses or similar which expressly forbid you engaging in other employment or becoming self-employed while simultaneously working for your current employer. You may want to check this out before making any moves to register as a limited company. You may forfeit long-term benefits (such as a pension) you have built up at your present employer if they catch wind of a conflict of interest. As noted in an earlier answer, the setup process for a limited company is extremely simple in the UK, so there is no reason you need to take these steps in advance of leaving your current employment. During my resignation period scout for contracts... Should I wait weeks before actually deciding to search for contracts? Depending on the type of IT work you intend to be contracting for, you may find yourself shut out from major work if you are not VAT registered. It is a requirement to register for VAT when you breach certain earnings limits (see HMRC's website) but you can voluntarily register with HMRC before these limits if you wish. Being VAT registered increases your bookkeeping and oversight requirements, which makes you appear more attractive to larger enterprises / corporations than a non-VAT registered firm. It also suggests some degree of stability and a plan to stick around for the long haul. This might be a catch-22 situation - if you want to get noticed and land the sizable contracts, you will almost certainly require a VAT registration regardless of your overall yearly earnings. It would be advisable to engage the services of a professional advisor before becoming VAT registered, but this and the subsequent professional advice you may require for putting in VAT claims may not be a fee you wish to pay upfront if you are only attracting a small volume of work." }, { "docid": "544995", "title": "", "text": "Yes if you do it as a hobby, as it's still income. But it should be something you can offset against tax Either way, you shouldn't be doing this as you, you should either register as self employed or create a company. You register this income as self-employed income (or income of the company) and offset the expenses of running the server against tax. In the UK, companies (or self employed people, which are basically companies) pay tax on profit not income (unless VAT applies, in which case they're basically just passing the VAT on for their customers). Since you're not making a profit over the whole year (even if some months are profitable) you will pay no tax." }, { "docid": "110515", "title": "", "text": "The way I see it, corporation tax is not fundamentally different from VAT. They are both a tax on revenue minus expenses, just what those expenses are is different. I think the main advantage of corporation tax is that it allows capital expenditure to be spread over several years, although as I said this makes it more complicated (and I believe that there are some capital allowances for VAT as well). One advantage of VAT is that sales in one country are taxed in that country before the money can be sent abroad. It seems simple and fair to split the tax burden between jurisdictions according to how many sales were made in each." }, { "docid": "391478", "title": "", "text": "No. The premise is just that the money paid, by employers, to fund employee health care is just being replaced by the VAT. If the numbers worked out right, the employers would (ideally) experience a near net zero change. Employee wages need not go up." }, { "docid": "189391", "title": "", "text": "\"http://www.hmrc.gov.uk/customs/tax-and-duty.htm#3 explains the Import VAT situation quite well. As for who enforces and collects it, if you're talking about buying online and having it shipped to you then you'll notice on the parcel a Customs sticker declaring the contents and value. It is the responsibility of the courier company to collect any duty due from you and pass it on to HMRC. In practice what this means is that you receive a card or note from the courier saying \"\"we're impounding your package until you pay the import duty\"\" and they usually charge a fee on top of the duty itself. Of course you can always go out there yourself and bring something back, but then it is your responsibility to declare it at the customs checkpoint when you enter the country.\"" }, { "docid": "475607", "title": "", "text": "The plumber will apply for and receive a refund of the amount of VAT he paid on the purchase amount. That's the cornerstone of how VAT works, as opposed to a sales tax. So for example: (Rounded approximate amounts for simplicity) Now, at each point, the amount between (original cost VAT) and (new VAT) is refunded. So by the end, a total of £3 VAT is paid on the pipe (not £6.2); and at each point the business 'adding value' at that stage pays that much. The material company adds £1 value; the producer adds £4 value; the supplier adds £5 value; the plumber adds £5 value. Each pays some amount of VAT on that amount, typically 20% unless it's zero/reduced rated. So the pipe supplier pays £1 but gets a £0.2 refund, so truly pays £0.8. The plumber pays £3 (from your payment) but gets a £2 refund. So at each level somebody paid a bit, and then that bit is then refunded to the next person up the ladder, with the final person in the chain paying the full amount. The £0.2 is refunded to the producer, the £1 is refunded to the supplier, the £2 is refunded to the plumber." }, { "docid": "295153", "title": "", "text": "\"Keep in mind that all of the information below assumes: That being said, here are some examples of national tax laws relating to barter transactions. Obviously this isn't an exhaustive list, but based on my grossly non-representative sample, I think it's fairly safe to assume that barter transactions are more likely taxable than not. You're referring to a barter system; in the United States, the IRS is very specific about this (see the section titled Bartering). Bartering is an exchange of property or services. The fair market value of goods and services exchanged is fully taxable and must be included on Form 1040 in the income of both parties. The IRS also provides more details: Bartering occurs when you exchange goods or services without exchanging money. An example of bartering is a plumber doing repair work for a dentist in exchange for dental services. You must include in gross income in the year of receipt the fair market value of goods and services received in exchange for goods or services you provide or may provide under the bartering arrangement. Generally, you report this income on Form 1040, Schedule C (PDF), Profit or Loss from Business or Form 1040, Schedule C-EZ (PDF), Net Profit from Business. If you failed to report this income, correct your return by filing a Form 1040X (PDF). Refer to Topic 308 for amended return information. So yes, the net value of bartered goods or services is most likely taxable. According to the Australian Tax Office: Barter transactions are assessable and deductible for income tax purposes to the same extent as other cash or credit transactions. Her Majesty's Revenue and Customs states that: If you supply services or goods (new or second-hand) and receive other goods or services in payment, there are two separate supplies: You must account for VAT, and so must your customer if they're VAT-registered. The VAT treatment is the same as for part-exchanges. You must both account for VAT on the amounts you would each have paid for the goods or services if there had been no barter and they had been paid for with money. Searching the website of the Federal Tax Service for the Russian/Cryllic word for barter (бартер) doesn't yield any results, but that might be because even between Google Translate and the rest of the internet, I don't speak Russian. That being said, I did manage to find this (translated from the first full paragraph of the Russian, beginning with \"\"Налог на доходы...\"\": The tax on personal income is paid by citizens of the Russian Federation with all types of income received by them in the calendar year, either in cash or in kind. Since bartering would probably qualify as an in kind transaction, it would likely be taxable. The South African Revenue Service includes barter transactions in the supply of goods taxed under the VAT. The term “supply” is defined very broadly and includes all forms of supply and any derivative of the term, irrespective of where the supply is effected. The term includes performance in terms of a sale, rental agreement, instalment credit agreement or barter transaction. Look for section 3.6, Supply and Taxable Supply, found on p17 of the current version of the linked document.\"" }, { "docid": "442425", "title": "", "text": "You can register a limited company and leave it dormant, that's no problem. You just need to make sure that later on you notify HMRC within 3 months of any trading activity. As pointed out, you can register a company in a few hours now so I wouldn't worry about that. Your confusion about Private Limited Companies is understandable, it's often not made clear but UK formation services standard packages are always Private Limited by Shares companies. Limited by Guarantee is something else, and normally used by charities or non-profits only. See explanations here. Registering for VAT is optional until you reach the £81,000 turnover threshold but it can make your services more attractive to large companies - especially in your field of business. You should really seek professional advice on whether or not this is the best option for you." } ]

[ { "docid": "378437", "title": "", "text": "\"While this does fall under the \"\"All-inclusive income\"\" segment of GI (gross income), there are two questions that come up. I invested in a decentralized bitcoin business and earned about $230 this year in interest from it Your wording is confusing here only due to how bitcoin works.\"" } ]

[ { "docid": "380851", "title": "", "text": "\"From Wikipedia: Usage Because EV is a capital structure-neutral metric, it is useful when comparing companies with diverse capital structures. Price/earnings ratios, for example, will be significantly more volatile in companies that are highly leveraged. Stock market investors use EV/EBITDA to compare returns between equivalent companies on a risk-adjusted basis. They can then superimpose their own choice of debt levels. In practice, equity investors may have difficulty accurately assessing EV if they do not have access to the market quotations of the company debt. It is not sufficient to substitute the book value of the debt because a) the market interest rates may have changed, and b) the market's perception of the risk of the loan may have changed since the debt was issued. Remember, the point of EV is to neutralize the different risks, and costs of different capital structures. Buyers of controlling interests in a business use EV to compare returns between businesses, as above. They also use the EV valuation (or a debt free cash free valuation) to determine how much to pay for the whole entity (not just the equity). They may want to change the capital structure once in control. Technical considerations Data availability Unlike market capitalization, where both the market price and the outstanding number of shares in issue are readily available and easy to find, it is virtually impossible to calculate an EV without making a number of adjustments to published data, including often subjective estimations of value: In practice, EV calculations rely on reasonable estimates of the market value of these components. For example, in many professional valuations: Avoiding temporal mismatches When using valuation multiples such as EV/EBITDA and EV/EBIT, the numerator should correspond to the denominator. The EV should, therefore, correspond to the market value of the assets that were used to generate the profits in question, excluding assets acquired (and including assets disposed) during a different financial reporting period. This requires restating EV for any mergers and acquisitions (whether paid in cash or equity), significant capital investments or significant changes in working capital occurring after or during the reporting period being examined. Ideally, multiples should be calculated using the market value of the weighted average capital employed of the company during the comparable financial period. When calculating multiples over different time periods (e.g. historic multiples vs forward multiples), EV should be adjusted to reflect the weighted average invested capital of the company in each period. In your question, you stated: The Market Cap is driven by the share price and the share price is determined by buyers and sellers who have access to data on cash and debts and factor that into their decision to buy or sell. Note the first point under \"\"Technical Considerations\"\" there and you will see that the \"\"access to data on cash and debts\"\" isn't quite accurate here so that is worth noting. As for alternatives, there are many other price ratios one could use such as price/earnings, price/book value, price/sales and others depending on how one wants to model the company. The better question is what kind of investing strategy is one wanting to use where there are probably hundreds of strategies at least. Let's take Apple as an example. Back on April 23, 2014 they announced earnings through March 29, 2014 which is nearly a month old when it was announced. Now a month later, one would have to estimate what changes would be made to things there. Thus, getting accurate real-time values isn't realistic. Discounted Cash Flow is another approach one can take of valuing a company in terms of its future earnings computed back to a present day lump sum.\"" }, { "docid": "403948", "title": "", "text": "If you hold this money in USD and spend it in the US as USD, then there is no tax liability or reporting requirement at all. You are not subject to any tax on foreign exchange gains and losses because you have not performed any foreign exchange. CRA says a foreign exchange gain or loss happens when the fx transaction occurs—not as the currency’s value fluctuates while on deposit - and since you are never performing an fx transaction, no such issues will arise. The CRA is not interested in how you spend your money, only the money that you earn. The only possible tax liability that would arise in the circumstances that you describe would be the tax liability arising from interest earned while the cash in on deposit. If this interest exceeds the threshold of reportability, then your bank will issue you with a T-slip to be included in your tax return." }, { "docid": "44617", "title": "", "text": "\"There are no guarantees in the stock market. The index fund can send you a prospectus which shows what their results have been over the past decade or so, or you can find that info on line, but \"\"past results are not a guarantee of future performance\"\". Returns and risk generally trade off against each other; trying for higher than average results requires accepting higher than usual risk, and you need to decide which types of investments, in what mix, balance those in a way you are comfortable with. Reinvested dividends are exactly the same concept as compounded interest in a bank account. That is, you get the chance to earn interest on the interest, and then interest on the interest on the interest; it's a (slow) exponential growth curve, not just linear. Note that this applies to any reinvestment of gains, not just automatic reinvestment back into the same fund -- but automatic reinvestment is very convenient as a default. This is separate from increase in value due to growth in value of the companies. Yes, you will get a yearly report with the results, including the numbers needed for your tax return. You will owe income tax on any dividends or sales of shares. Unless the fund is inside a 401k or IRA, it's just normal property and you can sell or buy shares at any time and in any amount. Of course the advantage of investing through those special retirement accounts is advantageous tax treatment, which is why they have penalties if you use the money before retirement. Re predicting results: Guesswork and rule of thumb and hope that past trends continue a bit longer. Really the right answer is not to try to predict precise numbers, but to make a moderately conservative guess, hope you do at least that well, and be delighted if you do better... And to understand that you can lose value, and that losses often correct themselves if you can avoid having to sell until prices have recovered. You can, of course, compute historical results exactly, since you know how much you put in when, how much you took out when, and how much is in the account now. You can either look at how rate of return varied over time, or just compute an average rate of return; both approaches can be useful when trying to compare one fund against another... I get an approximate version of this reported by my financial management software, but mostly ignore it except for amusement and to reassure myself that things are behaving approximately as expected. (As long as I'm outperforming what I need to hit my retirement goals, I'm happy enough and unwilling to spend much more time on it... and my plans were based on fairly conservative assumptions.) If you invest $3k, it grows at whatever rate it grows, and ten years later you have $3k+X. If you then invest another $10k, you now have $3k+X+10k, all of which grows at whatever rate the fund now grows. When you go to sell shares or fractional shares, your profit has to be calculated based on when those specific shares were purchased and how much you paid for them versus when they were sold and how much you sold them for; this is a more annoying bit of record keeping and accounting than just reporting bank account interest, but many/most brokerages and investment banks will now do that work for you and report it at the end of the year for your taxes, as I mentioned.\"" }, { "docid": "531605", "title": "", "text": "\"How do I leave 0 tip and not feel guilty or make anyone feel bad? Rationalizing the wages of restaurant staff is not within the control of the wait staff. In fact, the IRS assumes that restaurants where tipping occurs will receive at least 8% of their gross receipts in tips: IRS Topic Number: 761 - Tips – Withholding and Reporting If the total tips reported by all employees at your large food or beverage establishment are less than 8 percent of your gross receipts (or a lower rate approved by the IRS), you must allocate the difference between the actual tip income reported and 8 percent of gross receipts among the employees who received tips. So, as little sense as it may make, tipping is baked into the US tax code. There's no way you can refuse to tip in an establishment where tipping is the practice and not make someone feel bad, since it will have a real impact on their earnings. If you are serious about your principles, you should exclusively patronize restaurants with a \"\"no tipping\"\" policy. They are becoming more common. If you patronize restaurant where tipping is expected and refuse to tip, then people will suspect that it's less about your principles and more about being a \"\"free rider\"\".\"" }, { "docid": "312411", "title": "", "text": "\"&gt;The currencies pay people for mining Why do you think people mine? What is the function of \"\"mining\"\"? &gt;There is no reason financial institutions couldn't create their own closed-network to recordkeep transactions using block chain but without a cryptocurrency. Walk me through how that looks. This would be a node based system right? Not a client-server model?\"" }, { "docid": "524957", "title": "", "text": "I'd say blockchain technology more than cryptocurrency, cryptocurrency is just 1 application of blockchain tech; and we have not seen the whole development, not just yet. Like someone else commented AI/Robotics at large is the 1 big thing I see coming down the pipeline." }, { "docid": "277812", "title": "", "text": "There are many different types of 1099 forms. Since you are comparing it to a W-2, I'm assuming you are talking about a 1099-MISC form. Independent contractor income If you are a worker earning a salary or wage, your employer reports your annual earnings at year-end on Form W-2. However, if you are an independent contractor or self-employed you will receive a Form 1099-MISC from each client that pays you at least $600 during the tax year. For example, if you are a freelance writer, consultant or artist, you hire yourself out to individuals or companies on a contract basis. The income you receive from each job you take should be reported to you on Form 1099-MISC. When you prepare your tax return, the IRS requires you to report all of this income and pay income tax on it. So even if you receive a 1099-MISC form, you are required to pay taxes on it." }, { "docid": "110217", "title": "", "text": "Just tried to buy lunch with some gold dust. They said they only take US dollars. Gold is really no different than fiat paper/digital or even cryptocurrencies. Outside of the industrial uses for it, of which there are many but not so many that it would use up all the gold that's been mined shy of just using up all the gold that's been mined to use up all the gold that's been mined, its value is also based on perception and perceived value.. ..no different than anything else someone wants and is willing to do x in order to get it. When push comes to shove, other things contain way more value than gold, and gold is just *a* medium with which to exchange those things for.. But, again, only because people agree for it *to* be a medium they're willing to accept. Again, you can't eat, drink, fuck, shelter, etc yourself with gold, you can only get food, drink, sex with it.. ..if the other party is willing to accept it which, today, wasn't the case. https://www.coindesk.com/gold-investor-john-hathaway-cryptocurrencies-garbage/" }, { "docid": "111076", "title": "", "text": "\"The company released its 2nd Quarter Revenue of $1,957,921 a couple days ago however the stock did not move up in any way. Why? If the company is making money shouldn't the stock go up. During the time between earnings announcements, analysts occasionally publish their assessment of a company, including their estimate of the company's value and future earnings. And as part of an earnings report, companies often include \"\"guidance\"\": their prediction for the upcoming quarter (this will frequently be a conservative estimate, so they're more likely to achieve it). Investors make their purchase and sale decisions based on this information. When the earnings report comes out, investors compare these actual returns to analysts' predictions and the company's guidance. If their results are in line with these predictions, the stock price is unlikely to move much, as those results are already incorporated into the stock price. If the company is doing better than predicted, it's usually a good sign, and the price often rises; conversely, if it's doing worse, the price will likely fall. But it's not as simple as this. As others have explained, for long-term investors, stock prices are based on expectations of future activity. If the results of that quarter include some one-time actions that are unlikely to repeat, investors will often discount that portion.\"" }, { "docid": "4290", "title": "", "text": "P/E is the number of years it would take for the company to earn its share price. You take share price divided by annual earnings per share. You can take the current reported quarterly earnings per share times 4, you can take the sum of the past four actual quarters earnings per share or you can take some projected earnings per share. It has little to do with a company's actual finances apart from the earnings per share. It doesn't say much about the health of a company's balance sheet, and is definitely not an indicator for bankruptcy. It's mostly a measure of the market's assumptions of the company's ability to grow earnings or maintain it's current earnings growth. A share price of $40 trading for a P/E ratio of 10 means it will take the company 10 years to earn $40 per share, it means there's current annual earnings per share of $4. A different company may also be earning $4 per share but trade at 100 times earnings for a share price of $400. By this measure alone neither company is more or less healthy than the other. One just commands more faith in the future growth from the market. To circle back to your question regarding a negative P/E, a negative P/E ratio means the company is reporting negative earnings (running at a loss). Again, this may or may not indicate an imminent bankruptcy. Increasing balance sheet debt with decreasing revenue and or earnings and or balance sheet assets will be a better way to assess bankruptcy risk." }, { "docid": "66492", "title": "", "text": "You're charging service fees as a conduit entity for these tickets. While the service fee is not a fixed rate, but a percentage, you would need to record each purchase at dollar amount. To illustrate, it would look like: Now, to your question: How do I report this on my taxes? You would first start out by filing your Schedule C from the eyes of the business (the money you earn at your job, and the money you earn as a business are different). Just keep a general journal with the above entry for each sale and close them down to a simple balance sheet and income statement and you should be fine. Of course, read the instructions for your Schedule C before you begin. As always, good luck." }, { "docid": "65040", "title": "", "text": "As the owner of the S-corp, it is far easier for you to move money in/out of the company as contributions and distributions rather than making loans to the company. Loans require interest payments, 1099-INT forms, and have tax consequences, whereas the distributions don't need to be reported because you pay taxes on net profits regardless of whether the money was distributed. If you were paid interest, disregard this answer. I don't know if or how you could re-categorize the loan once there's a 1099-INT involved. If no interest was ever paid, you just need to account for it properly: If the company didn't pay you any interest and never issued you a 1099-INT form (i.e. you wrote a check to the company, no promissory note, no tax forms, no payments, no interest, etc.) then you can categorize that money as a capital contribution. You can likewise take that money back out of the company as a capital distribution and neither of these events are taxable nor do they need to be reported to the IRS. In Quickbooks, create the following Equity accounts -- one for each shareholder making capital contributions and distributions: When putting money into the company, deposit into your corporate bank account and use the Capital Contribution equity account. When taking money out of the company, write yourself a check and use the Distributions account. At the end of every tax year, you can close out your Contributions and Distributions to Retained Earnings by making a general journal entry. For example, debit retained earnings and credit distributions on Dec 31 every year to zero-out the distributions account. For contributions, do the reverse and credit retained earnings. There are other ways of recording these transactions -- for example I think some people just use a Member Capital equity account instead of separate accounts for contributions and distributions -- and QB might warn you about posting journal entries to the special Retained Earnings account at the end of the year. In any case, this is how my CPA set up my books and it's been working well enough for many years. Still, never a bad idea to get a second opinion from your CPA. Be sure to pay yourself a reasonable salary, you can't get out of payroll taxes and just distribute profits -- that's a big red flag that can trigger an audit. If you're simply distributing back the money you already put into the company, that should be fine." }, { "docid": "43967", "title": "", "text": "\"Why would you file four K-1s for each partner? You file one K-1 per partner, on which you report the total of income attributed to that partner. It shouldn't and cannot \"\"vary\"\". There's no variables here, the income you report is the income already earned and attributed to that partner. What's there to vary? How you decide the attribution of income is governed by your operating agreement, the IRS only needs the bottom line.\"" }, { "docid": "103618", "title": "", "text": "\"Bittcoin is not a currency, it's a store of value, because it is not widely accepted as tender by most people. Even as a store of value, it's not very good. It's volatile and the fact that there is a limited supply of bitcoin is not a good thing. Sure, in the short run it results in speculation that drives up the price of a coin and makes it all the rage among gamblers but I don't think anyone can explain how, if used on a larger scale, wouldn't lead to deflation in the price of goods. Also, at the end of the day, fiat currencies are based on trust and accountability of the government. How does Bitcoin or any other online currency solve that problem? There's no accountability, and it effectively acts as as an anti-currency, fueled by mistrust in the establishment. What do you mean, \"\"cryptocurrencies are growing hundreds of times faster than the market as a whole\"\"?\"" }, { "docid": "594641", "title": "", "text": "\"IT appears the company you're talking about did not report as you expected them to, which is not unusual for OTC companies because, as Milo stated, they are not well-managed. That being said, reports on EDGAR are available as soon as they're posted. I'm not aware of any lag between when the company uploads their report and it is available on the EDGAR site. Looking at the profile of the company you're referring to, I'm curious why you'd be so interested in a company with huge negative earnings, a near-zero share price, and an obviously spotty history of reporting its numbers. In order to make any money with this stock, you'd have to buy a huge number of shares, which could be difficult to unload. Further, the fees you're going to pay to make your trades are very likely to outstrip your return, so you'd be upside down on it. This company has pretty negative financials, and in a world of cheap oil, alternative energy (and the companies that deal in it) are out of vogue, so they're not likely to see a turnaround anytime soon. They're spending money on R & D at a rate almost 17 times earnings, and the losses are deepening, while revenues are not improving all that much. These guys are bleeding to death, and there's little prospect of a financial transfusion on the horizon. This is, as they say, a \"\"dog with fleas\"\", so your best bet is to find something else to put your money into. I hope this helps. Good luck!\"" }, { "docid": "514084", "title": "", "text": "\"Congratulations on getting married! As far as the IRS is concerned, you are a married couple for all of this year for tax purposes. The 2014 HSA contribution limit for you and your husband together is $6550. This limit applies to both of you together, whether you file jointly or separately. So it looks like you and your husband have excess contributions this year. You'll need to withdraw some contributions, either in your account or your husband's account, to get under $6550 total for the year. If you choose to take this money out of your account, since you have already spent this money out of your HSA, you won't actually receive a check from the withdrawal. Instead, the money that you have already spent will be recategorized from a normal HSA medical distribution to an excess contribution withdrawal. When you get your 1099-SA form from your HSA bank at tax time, the distributions will be coded as excess contributions distributions. In addition, the form will include the amount of any earnings (interest) that you received on your excess contributions. At tax time, you'll need to examine your W-2 form from your employer closely. If the form does not include the amount that the employer HSA contribution in your taxable income, you'll need to add this amount as \"\"Other income\"\" on your taxes. You'll also need to include any earnings on the excess contributions reported on the 1099-SA. Since your husband funds his own HSA and doesn't have any employer contributions to it, you might find it easier to withdraw the excess contributions from his HSA instead of yours. To do this, you need to tell his HSA bank that the withdrawal is an excess contribution withdrawal so that it gets reported correctly on his 1099-SA. There won't be any changes to his W-2, and the only \"\"other income\"\" he'll need to report is any earnings on the excess contributions from his 1099-SA. The instructions for Form 8889, line 13 explain what to do in the event of an excess contribution (note: The text here is from the 2013 version of the instructions): Line 13 If you or someone on your behalf (or your employer) contributed more to your HSA than is allowable, you may have to pay an additional tax on the excess contributions. Figure the excess contributions using the following instructions. See Form 5329, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts, to figure the additional tax. Excess Contributions You Make To figure your excess contributions (including those made on your behalf), subtract your deductible contributions (line 13) from your actual contributions (line 2). However, you can withdraw some or all of your excess contributions for 2013 and they will be treated as if they had not been contributed if: You make the withdrawal by the due date, including extensions, of your 2013 tax return (but see the Note under Excess Employer Contributions, later), You do not claim a deduction for the amount of the withdrawn contributions, and You also withdraw any income earned on the withdrawn contributions and include the earnings in “Other income” on your tax return for the year you withdraw the contributions and earnings. Excess Employer Contributions Excess employer contributions are the excess, if any, of your employer's contributions over your limitation on line 8. If you made a qualified HSA funding distribution (line 10) during the tax year, reduce your limitation (line 8) by that distribution before you determine whether you have excess employer contributions. If the excess was not included in income on Form W-2, you must report it as “Other income” on your tax return. However, you can withdraw some or all of the excess employer contributions for 2013 and they will be treated as if they had not been contributed if: You make the withdrawal by the due date, including extensions, of your 2013 tax return (but see the following Note), You do not claim an exclusion from income for the amount of the withdrawn contributions, and You also withdraw any income earned on the withdrawn contributions and include the earnings in “Other income” on your tax return for the year you withdraw the contributions and earnings. There are further instructions on what to do if you don't take care of this until a future year, but it is much better and easier if you take care of this before the end of this year, and handle it correctly on your tax return. I believe that this is how it will all work; however, you'll want to confirm all of this with someone who knows what they are talking about and can look at your individual situation. Hopefully, this answer gives you enough information to be able to ask the right questions.\"" }, { "docid": "350315", "title": "", "text": "Do I report it as income? Is it subject to just the same amount of taxes (~30%) as regular income? Are there any restrictions on how it can be used? It is income. You can deduct the costs of maintaining the web page and producing the software from it (have an accountant do that for you, there are strict rules on how to do that, and you can only deduct up to the income if its a hobby and not a for-profit business), but otherwise it's earned income like any other self employment income. It is reported on your schedule C or on line 21 of your 1040 (miscellaneous income), and you're also liable for self-employment taxes on this income. There are no restrictions, it's your money. Technically, who is the donation even being made to? Me, just because I own the webpage? Yes. This is for the United States, but is there any difference if the donations come from overseas? No, unless you paid foreign taxes on the money (in which case you should fill form 1116 and ask for credit). If you create an official 501(c) organization to which the donations are given, instead of you getting it directly, the tax treatment will be different. But of course, you have to have a real charitable organization for that. To avoid confusion - I'm not a licensed tax professional and this is not a tax advice. If in doubt - talk to a EA/CPA licensed in your State." }, { "docid": "444589", "title": "", "text": "\"EBITDA is in my opinion not a useful measure for an investor looking to buy shares on the stock market. It is more useful for private businesses open to changing their structuring, or looking to sell significant parts of their business. One of the main benefits of reporting Earnings Before Interest, Taxes, Depreciation & Amortization, is that it presents the company as it would look to a potential buyer. Consider that net income, as a metric, includes interest costs, taxes, and depreciation. Interest costs are (to put it simply) a result of multiplying a business's debt by its interest rate. If you own a business, and personally guarantee the loan that the company has with the bank, your interest rates might be artificially low. If you have a policy of reaching high debt levels relative to your equity, in order to achieve high 'financial leveraging', your interest cost might be artificially high. Either way, if I bought your business, my debt structure could be completely different, and therefore your interest costs are not particularly relevant to me, a potential buyer. Instead, I should attempt to anticipate what my own interest costs would be, under my plans for your business. Taxes are a result of many factors, including the corporate structure of the business. If you run your business as a sole proprietorship (ie: no corporation), but I want to buy it under my corporation, then my tax rates could look nothing like yours. Or if we operated in multiple jurisdictions. etc. etc. Instead of using your taxes as an estimate for mine, I should anticipate my taxes based on my plans for your business. Depreciation / amortization is a measure that estimates how much of a business's \"\"fixed assets\"\" were \"\"used up\"\" during the year. ie: how much wear and tear occurred on your fleet of trucks? It is generally calculated as a % of your overall asset value. It is a (very loose) proxy for the cash costs which will ultimately be incurred to make repairs/replacements. D&A is also something which could significantly change if a business changes hands. If the value of your building is much higher now than when you bought it, I will have higher D&A costs than you [because I will be recording a % of total costs higher than yours], and therefore I should forecast my own D&A. Removing these costs from Net Income is not particularly relevant for a casual stock investor, because these costs will not change when you buy shares. Whatever IBM's interest cost is, reflects the debt structuring policy that the company currently has. Therefore when you buy a share in IBM, you should consider the impact that interest has on net income. Similarly for taxes and D&A - they reflect costs to the business that impact the company's ability to pay you a dividend, and therefore you should look at net income, which includes those costs. Why would a business with 'good net income' and 'good EBITDA' report EBITDA? Because EBITDA will always be higher than net income. Why say $10M net income, when you could say $50M EBITDA? The fact is, it's easy to report, and is generally well understood - so why not report it, when it also makes you look better, from a purely \"\"big number = good\"\" perspective? I'm not sure that reporting EBITDA implies any sort of manipulative reporting, but it would seem that Warren Buffet feels this is a risk.\"" }, { "docid": "172457", "title": "", "text": "You would be required to report it as self-employment income and pay tax accordingly. It's up to you to keep proper records (like a receipt book, for example), especially when it comes to cash. If you can't prove exactly how much you earned and the government decides to guess the amount for you then you won't like the outcome!" } ]

[ { "docid": "269987", "title": "", "text": "\"As cryptocurrencies are rather new compared to most assets, there hasn't been a lot of specific guidance for a lot of situation, but in 2014 the IRS announced that it published guidance in Notice 2014-21. I'm not aware of further guidance that has been published beyond that, though it wouldn't surprise me if treatments changed over time. In that notice, the answer to the first question describes the general treatment: For federal tax purposes, virtual currency is treated as property. General tax principles applicable to property transactions apply to transactions using virtual currency. Your specific questions (about what constitutes a \"\"business\"\", and when you're considered to be \"\"selling\"\" the cryptoproperty) are likely to be considered on a case by case basis by the IRS. As the amounts involved here are so small (relatively speaking), my recommendation would be to read through what the IRS has published carefully, make reasonable assumptions about what scenarios that are described are closest to what you're doing, and document doing so clearly as part of your tax preparations. And when in doubt, erring on the side of whichever option incurs more tax is unlikely to be objected to by them. Of course, I'm not a lawyer or tax advisor, I'm a stranger on the Internet, so for \"\"real\"\" advice you should contact somebody qualified. I doubt you'd be faulted too much for not doing so given the amounts involved. You could also attempt contacting a local IRS office or calling them with your specific questions, and they may be able to provide more specific guidance tailored to you, though doing so may not save you from an auditor deciding something differently if they were to examine your return later. There are also phone numbers to contact specific people listed at the end of Notice 2014-21; you could try calling them as well.\"" } ]

[ { "docid": "452899", "title": "", "text": "If your gross income is only $3000, then you don't need to file: https://www.irs.gov/pub/irs-pdf/p501.pdf That said, pay careful attention to: https://www.irs.gov/individuals/international-taxpayers/taxpayers-living-abroad You should be reporting ALL income, without regard to WHERE you earned it, on your US taxes. Not doing so could indeed get you in trouble if you are audited. Your level of worry depends on how much of the tax law you are willing to dodge, and how lucky you feel." }, { "docid": "184583", "title": "", "text": "Any thoughts? I would love to hear your feedback. I have been making more on my cryptocurrency investments than I have in trading options. I am falling more and more in love with the cryptocurrency market. There's is nothing like it out there. I tell people, it's like investing in the internet 17 years ago!" }, { "docid": "87379", "title": "", "text": "\"@farnsy has provided a good answer. I'm only addressing my comment about the data quality. The portfolio optimization technique you employed is very sensitive to the inputs. In particular, it relies entirely on the mean and (co)variance assumptions (i.e. the first two moments) and the results could change drastically with very small amount of change in the inputs. To see that, you can make up some inputs for the solver you have, and try adjusting the inputs a little bit and see the results. Therefore if you decide to take this approach, data quality is very crucial. EDIT: What I meant by \"\"data quality\"\" I have no experience with this website but this should be easy to spot check. The answer is usually \"\"yes\"\" for liquid assets. Illiquid assets can often be priced at a level with no volume, and the bid-ask spread could be huge. Should I close my eyes on the fact that these cryptocurencies aren't perfectly priced in my currency and use another one (such as the dollar) You seem to have concern about data quality in at least the price quoted in your currency and are thinking about using data quoted in USD, but would it be any better? The law of one price tells us that there shouldn't be any discrepancy between prices in different currencies (otherwise there would be arbitrage). In addition, (when compared to traditional assets) cryptocurrency price data has a shorter data history, and with lower liquidity in the market. The short history means you have less data to infer the characteristics of the price behavior. Low liquidity means the volatility may well be underestimated. So we have an input-sensitive technique combined with not-so-perfect data. I wouldn't allocate my money solely based on the result of this exercise. EDIT: I have quite some reservation about doing portfolio optimization for cryptocurrency. Personally I'm not a fan of the technique as is. The optimization has an underlying assumption that returns follow a certain distribution, and correlation is fixed. I don't know if you can make such assumption for cryptocurrencies. From what I read about BTC for example, it seems to have a high risk exposure concerning Chinese monetary policy. For that kind of assets perhaps a fundamental analysis approach is a better one. Also if you would like to learn more about portfolio optimization, try quant.SE\"" }, { "docid": "254388", "title": "", "text": "It has everything to do with post-tax earnings. You can only contribute into a Roth IRA up to either $5500 or your taxable compensation (wages, salaries, self-employment income, commissions, etc.), whichever is less. So your contributions have already been taxed as income (either withheld or when you file your 1040 next year). Importantly, this means that you can't contribute gifts, previous savings, unearned income, or under-the-table earnings that you don't report* into a Roth (of course, this only is a factor if you report less than $5500 in income since money is fungible). *Note: I mention this for completeness, not as a recommendation, unreported income can get you into hot water, just ask Mr. Capone..." }, { "docid": "105733", "title": "", "text": "The backlog is more like 650,000. 450,000 was for the first week after the reveal. It's been climbing since. Source: Musk has disclosed the size of the reservation list and the number of cancellations (over 8,000!) on the record at quarterly earnings conference calls to guide analysts and inform investors. While I did not listen to those calls, I read articles from BGR.com covering those calls and reporting on how they are openly saying they are sold out for 2018 at this point." }, { "docid": "409542", "title": "", "text": "This why economists hate people like OP: They only read headlines and abstracts. &gt;Given the importance of low wealth at retirement in explaining low wealth late in life, this paper begins by exploring the factors that are associated with low saving before retirement. We pay particular attention to the links between education, health status, and wealth at age 65 and at the end of life. We examine the distribution of lifetime earnings, a key determinant of savings capacity, and calculate a “saving ratio,” the ratio of wealth at retirement to lifetime earnings. This ratio depends on a household’s saving 2 rate over the life course, as well as on the rate of return earned on this saving. We also present new evidence on how health and family status shocks affect the trajectory of wealth after retirement, and in particular how they affect the likelihood of reporting very low wealth at the end of life." }, { "docid": "524957", "title": "", "text": "I'd say blockchain technology more than cryptocurrency, cryptocurrency is just 1 application of blockchain tech; and we have not seen the whole development, not just yet. Like someone else commented AI/Robotics at large is the 1 big thing I see coming down the pipeline." }, { "docid": "404175", "title": "", "text": "Bitfinexnetwork is a portfolio management program headquartered in London (UK). We already have a plant set-up that mines ethereum and G-CAS. Our plant or mining pool is in China. We mine crypto currencies and trade them further. People buy servers and lease back to us. When they lease them back, we offer them to participate in the output that we receive in the form of ‘’fixed returns’’. Bitfinexnetwork is India’s first portfolio management program that has a physical presence in sec 63, Noida. To maintain transparency among our members, anyone is allowed to come and meet us and have complete knowledge about the crypto world. We have taken official API from Bitfinex.com for trading purpose. Just to clarify, this is the only relationship between Bitfinex.com and Bitfinexnetwork.com. Our goal is to make mining and trading accessible to all users regardless of age, location, investment, technical nouse or experience. We want to give our customers an opportunity to try out cryptocurrency mining and earn Bitcoin as a reward. On a larger scale, we hope to contribute to the development of mining services and subsequently to the development, establishment and adoption of Bitcoin both as a currency and as an economic system" }, { "docid": "449970", "title": "", "text": "You're asking three different questions... Q1: What's to stop people not reporting income earned in this manner? A: Nothing. Absolutely nothing. The IRS doesn't have the means to keep track of your cash flow and your reported taxes on the fly. Q2: How could the IRS possibly keep track of that? A: When you get audited. If it ever did come up that things didn't balance you would end up owing back taxes, with interest and possibly fines. Q3: Moral obligations aside... why report? A: Since you've dismissed 'doing your duty as a citizen' as a moral obligation, the only other real one is that it's a pain in the butt to get audited and it is expensive if you lie and get caught." }, { "docid": "43967", "title": "", "text": "\"Why would you file four K-1s for each partner? You file one K-1 per partner, on which you report the total of income attributed to that partner. It shouldn't and cannot \"\"vary\"\". There's no variables here, the income you report is the income already earned and attributed to that partner. What's there to vary? How you decide the attribution of income is governed by your operating agreement, the IRS only needs the bottom line.\"" }, { "docid": "111274", "title": "", "text": "My understanding is that the only tax implication is that any interest income earned on foreign accounts is still taxable in the US if held by a US citizen. If the total across foreign accounts totals more than $10,000 you'll have to report those accounts to the Treasury via FinCEN Form 114, this doesn't create any additional tax obligations, it's just a regulatory measure to stop people from hiding money overseas and not paying tax on those earnings. If the US account is only in your husband's name, and the Australian account is only in your name, there may not be any reporting requirement to the Treasury. Money transferred between spouses is not subjected to gift-tax." }, { "docid": "2421", "title": "", "text": "A bank will never tell you how much they made off you when you are a customer. That level of information can be gleaned somewhat from the P&L it posts to its shareholders every FY. TLDR: It's how much you earned and should report as income in your tax documents." }, { "docid": "277812", "title": "", "text": "There are many different types of 1099 forms. Since you are comparing it to a W-2, I'm assuming you are talking about a 1099-MISC form. Independent contractor income If you are a worker earning a salary or wage, your employer reports your annual earnings at year-end on Form W-2. However, if you are an independent contractor or self-employed you will receive a Form 1099-MISC from each client that pays you at least $600 during the tax year. For example, if you are a freelance writer, consultant or artist, you hire yourself out to individuals or companies on a contract basis. The income you receive from each job you take should be reported to you on Form 1099-MISC. When you prepare your tax return, the IRS requires you to report all of this income and pay income tax on it. So even if you receive a 1099-MISC form, you are required to pay taxes on it." }, { "docid": "74120", "title": "", "text": "Cryptocurrency is undoubtedly at the peak of Gartner hype cycle, but it very well could revolutionise the way we use currency for our daily needs in the future. Stay with me on this… At present, cryptocurrency appears no more than a speculation that is sugar-coated by individuals who have vested interest in it. However, if we overlook this excitement, the actual use of cryptocurrency is mind-boggling. Suppose you had a mid-life crisis and went on a journey to the middle of the Earth to find where humans supposedly originated from, and you met and connected with a local coffee farmer named Razaq in a very remote part of Ethiopia. He invited you for an evening coffee and you obliged, and six months later you yearned for this same coffee whilst you were having another wave of existential thoughts in your penthouse that overlooked the urban jungle. Suddenly, you remembered that Razaq had a cheap but functional smartphone with a Bitcoin wallet, and afterwards you communicated with him on WhatsApp and decided to enter in a transaction with him. Razaq is delighted with this technology, but mainly because he does not have to travel 100 km to-and-fro the nearest city where his bank is located, and he is also happy that he can send a sack of coffee beans to his friend who lives in a faraway land, and all he needs to do is hand over the coffee sack to delivery truck en route the shipping port. Ultimately, saving Razaq lot of his precious time and resources. Now use this one example and multiply it by hundreds of millions of people around the world who have a very remote access to a ‘bank’, but have an access to a basic smartphone – imagine the possibility of connecting people like Razaq to the ‘internet’ world and having a seamless cross-border trade finance transaction using currency that is not controlled by any government. Like many others, I am keen to see the developments of cryptocurrency in the coming years, but for now I remain sceptical. That said, I am more interest in the countless opportunities that will be unlocked by the very technology that is fundamental to all the cryptocurrencies; the Blockchain. Crytocurrency is one branch of Blockchain technology which has proved useful. There are million other possibilities which I'm sure will benefit many industries in the coming decade, and I, for one, am very excited." }, { "docid": "385949", "title": "", "text": "All you have to do is ask Warren Buffet that question and you'll have your answer! (grin) He is the very definition of someone who relies on the fundamentals as a major part of his investment decisions. Investors who rely on analysis of fundamentals tend to be more long-term strategic planners than most other investors, who seem more focused on momentum-based thinking. There are some industries which have historically low P/E ratios, such as utilities, but I don't think that implies poor growth prospects. How often does a utility go out of business? I think oftentimes if you really look into the numbers, there are companies reporting higher earnings and earnings growth, but is that top-line growth, or is it the result of cost-cutting and other measures which artificially imply a healthy and growing company? A healthy company is one which shows year-over-year organic growth in revenues and earnings from sales, not one which has to continually make new acquisitions or use accounting tricks to dress up the bottom line. Is it possible to do well by investing in companies with solid fundamentals? Absolutely. You may not realize the same rate of short-term returns as others who use momentum-based trading strategies, but over the long haul I'm willing to bet you'll see a better overall average return than they do." }, { "docid": "123693", "title": "", "text": "There is a moral and legal obligation to file the earnings. Not doing so is tax fraud. You should keep a ledger or some record of your earnings, helpful guidelines here. Records are required by the CRA: According to the law, your responsibilities include: (source) You could get in trouble if one of your pupils report the expense at their tax filing, and the CRA finds no matching statement on your filing report. Tutoring are eligible for tax credit in case of disability: Tutoring services that are supplementary to the primary education of a person with a learning disability or an impairment in mental functions, and paid to a person in the business of providing these services to individuals who are not related to the person. A medical practitioner must certify in writing that these services are necessary. So if one of your pupils fall under that provision, you will get tax trouble sooner or later. Bottom line: start making records now, and report your earnings. Collect your tax as any lawful citizen is required to." }, { "docid": "65040", "title": "", "text": "As the owner of the S-corp, it is far easier for you to move money in/out of the company as contributions and distributions rather than making loans to the company. Loans require interest payments, 1099-INT forms, and have tax consequences, whereas the distributions don't need to be reported because you pay taxes on net profits regardless of whether the money was distributed. If you were paid interest, disregard this answer. I don't know if or how you could re-categorize the loan once there's a 1099-INT involved. If no interest was ever paid, you just need to account for it properly: If the company didn't pay you any interest and never issued you a 1099-INT form (i.e. you wrote a check to the company, no promissory note, no tax forms, no payments, no interest, etc.) then you can categorize that money as a capital contribution. You can likewise take that money back out of the company as a capital distribution and neither of these events are taxable nor do they need to be reported to the IRS. In Quickbooks, create the following Equity accounts -- one for each shareholder making capital contributions and distributions: When putting money into the company, deposit into your corporate bank account and use the Capital Contribution equity account. When taking money out of the company, write yourself a check and use the Distributions account. At the end of every tax year, you can close out your Contributions and Distributions to Retained Earnings by making a general journal entry. For example, debit retained earnings and credit distributions on Dec 31 every year to zero-out the distributions account. For contributions, do the reverse and credit retained earnings. There are other ways of recording these transactions -- for example I think some people just use a Member Capital equity account instead of separate accounts for contributions and distributions -- and QB might warn you about posting journal entries to the special Retained Earnings account at the end of the year. In any case, this is how my CPA set up my books and it's been working well enough for many years. Still, never a bad idea to get a second opinion from your CPA. Be sure to pay yourself a reasonable salary, you can't get out of payroll taxes and just distribute profits -- that's a big red flag that can trigger an audit. If you're simply distributing back the money you already put into the company, that should be fine." }, { "docid": "299211", "title": "", "text": "\"-Alain Wertheimer I'm a hobbyist... Most (probably all) of those older items were sold both prior to my establishing the LLC This is a hobby of yours, this is not your business. You purchased all of these goods for your pleasure, not for their future profit. The later items that you bought after your LLC was establish served both purposes (perks of doing what you love). How should I go about reporting this income for the items I don't have records for how much I purchased them for? There's nothing you can do. As noted above, these items (if you were to testify in court against the IRS). \"\"Losses from the sale of personal-use property, such as your home or car, aren't tax deductible.\"\" Source Do I need to indicate 100% of the income because I can't prove that I sold it at a loss? Yes, if you do not have previous records you must claim a 100% capital gain. Source Addition: As JoeTaxpayer has mentioned in the comments, the second source I posted is for stocks and bonds. So at year begin of 2016, I started selling what I didn't need on eBay and on various forums [January - September]. Because you are not in the business of doing this, you do not need to explain the cost; but you do need to report the income as Gross Income on your 1040. Yes, if you bought a TV three years ago for a $100 and sold it for $50, the IRS would recognize you earning $50. As these are all personal items, they can not be deducted; regardless of gain or loss. Source Later in the year 2016 (October), I started an LLC (October - December) If these are items that you did not record early in the process of your LLC, then it is reported as a 100% gain as you can not prove any business expenses or costs to acquire associated with it. Source Refer to above answer. Refer to above answer. Conclusion Again, this is a income tax question that is split between business and personal use items. This is not a question of other's assessment of the value of the asset. It is solely based on the instruments of the IRS and their assessment of gains and losses from businesses. As OP does not have the necessary documents to prove otherwise, a cost basis of $0 must be assumed; thus you have a 100% gain on sale.\"" }, { "docid": "20888", "title": "", "text": "If you're waiting for Apple to send you a 1099 for the 2008 tax season, well, you shouldn't be. App Store payments are not reported to the IRS and you will not be receiving a 1099 in the mail from anyone. App Store payments are treated as sales commissions rather than royalties, according to the iTunes Royalty department of Apple. You are responsible for reporting your earnings and filing your own payments for any sums you have earned from App Store. – https://arstechnica.com/apple/2009/01/app-store-lessons-taxes-and-app-store-earnings The closest thing to sales commissions in WA state seems to be Service and Other Activities described at http://dor.wa.gov/content/FileAndPayTaxes/BeforeIFile/Def_TxClassBandO.aspx#0004. When you dig a little deeper into the tax code, WAC 458-20-224 (Service and other business activities) includes: (4) Persons engaged in any business activity, other than or in addition to those for which a specific rate is provided in chapter 82.04 RCW, are taxable under the service and other business activities classification upon gross income from such business. - http://apps.leg.wa.gov/wac/default.aspx?cite=458-20-224 I am not a lawyer or accountant, so caveat emptor." } ]

[ { "docid": "130118", "title": "", "text": "I'm afraid you're mistaking 401k as an investment vehicle. It's not. It is a vehicle for retirement. Roth 401k/IRA has the benefit of tax free distributions at retirement, and as long as you're in the low tax bracket - it is for your benefit to take advantage of that. However, that is not the money you would be using to start a business or buy a home (except for maybe up to $10K you can withdraw without penalty for first time home buyers, but I wouldn't bother with $10k, if that's what will help you buying a house - maybe you shouldn't be buying at all). In addition, you should make sure you take advantage of the employer 401k match in full. That is free money added to your Traditional 401k retirement savings (taxed at distribution). Once you took the full advantage of the employer's match, and contributed as much as you consider necessary for your retirement above that (there are various retirement calculators on line that can help you in making that determination), everything else will probably go to taxable (regular) savings/investments." } ]

[ { "docid": "290385", "title": "", "text": "\"Answers: 1. Is this a good idea? Is it really risky? What are the pros and cons? Yes, it is a bad idea. I think, with all the talk about employer matches and tax rates at retirement vs. now, that you miss the forest for the trees. It's the taxes on those retirement investments over the course of 40 years that really matter. Example: Imagine $833 per month ($10k per year) invested in XYZ fund, for 40 years (when you retire). The fund happens to make 10% per year over that time, and you're taxed at 28%. How much would you have at retirement? 2. Is it a bad idea to hold both long term savings and retirement in the same investment vehicle, especially one pegged to the US stock market? Yes. Keep your retirement separate, and untouchable. It's supposed to be there for when you're old and unable to work. Co-mingling it with other funds will induce you to spend it (\"\"I really need it for that house! I can always pay more into it later!\"\"). It also can create a false sense of security (\"\"look at how much I've got! I got that new car covered...\"\"). So, send 10% into whatever retirement account you've got, and forget about it. Save for other goals separately. 3. Is buying SPY a \"\"set it and forget it\"\" sort of deal, or would I need to rebalance, selling some of SPY and reinvesting in a safer vehicle like bonds over time? For a retirement account, yes, you would. That's the advantage of target date retirement funds like the one in your 401k. They handle that, and you don't have to worry about it. Think about it: do you know how to \"\"age\"\" your account, and what to age it into, and by how much every year? No offense, but your next question is what an ETF is! 4. I don't know ANYTHING about ETFs. Things to consider/know/read? Start here: http://www.investopedia.com/terms/e/etf.asp 5. My company plan is \"\"retirement goal\"\" focused, which, according to Fidelity, means that the asset allocation becomes more conservative over time and switches to an \"\"income fund\"\" after the retirement target date (2050). Would I need to rebalance over time if holding SPY? Answered in #3. 6. I'm pretty sure that contributing pretax to 401k is a good idea because I won't be in the 28% tax bracket when I retire. How are the benefits of investing in SPY outweigh paying taxes up front, or do they not? Partially answered in #1. Note that it's that 4 decades of tax-free growth that's the big dog for winning your retirement. Company matches (if you get one) are just a bonus, and the fact that contributions are tax free is a cherry on top. 7. Please comment on anything else you think I am missing I think what you're missing is that winning at personal finance is easy, and winning at personal finance is hard\"" }, { "docid": "411354", "title": "", "text": "If you leave your job with money that you contributed to the 401K, the company will have a policy about whether you can leave the money in the 401K or whether you must take it with you. I have normally seen that if it is a small amount, then it must be taken and if it is over a certain amount (maybe $10K) then you have the option of leaving it in the account or taking it out. If you take it out, then you should contact a brokerage first and get instructions from them for how to have it transferred into a rollover account to avoid having to pay tax. If the company makes the check out to you or transfers money into a non-retirement account, then they will very easily cause a taxable event and they will likely withhold tax from the payment. If you leave the money in the 401K after you leave, you will generally have fewer investment choices, higher fees, and you may have higher risks. Occasionally companies in hard times fraudulently raid their 401K accounts and when this happens it can be very difficult to get it back. (For examples see the Dept Of Labor page at http://www.dol.gov/ebsa/newsroom/criminal/main.html and look for 401k or retirement in titles). As far as having the money invested for several years, that time can be your friend if you get a reasonable rate of return. Over 30 years your money should be able to double multiple times. (At 8% return it will take less than 10 years to double the money. [see http://buyupside.com/calculators/doublemoneyfeb08.htm])" }, { "docid": "286746", "title": "", "text": "You can put them in a 5 years CD and getting a maximum of %2.5 APY if you're lucky. If you put 15k now, in 5 years you'll have $1.971. If it sounds good then take a look at the current inflation rate (i'm in usa)... If you want to think about retirement then you should open a Roth IRA. But you won't be able to touch the money without penalties (10% of earnings) before you get 59 1/2 years old. Another option would be to open a regular investment account with an online discounted broker. Which one? Well, this should be a totally separate question... If you decide to invest (Roth IRA or regular account) and you're young and inexperienced then go for a balanced mutual fund. Still do a lot of research to determine your portfolio allocation or which fund is best suited for you. Betterment (i never used it) is a no brainer investment broker. Please don't leave them in a generic checking or low interest savings account because you'll save nothing (see inflation again)..." }, { "docid": "337561", "title": "", "text": "\"The only time to stop saving money for retirement is when you have enough money to retire tomorrow. Not all of your \"\"retirement savings\"\" need to be in a 401k, it is just better if you can. Be sure to get as much as you can from the employer matching program. Unfortunately some employer matching programs discourage you from putting in too much. I've been able to max out the 401k contribution a number of times, which helps. Remember: you are likely to live to 100, so you better save enough to live that long. I don't trust social security to be there. I recommend saving so that you end up with \"\"enough to be comfortable\"\" -- this is usually about 25x your current income - PLUS inflation between now and when you plan to retire (age 62 is a good target). It is worth knowing your \"\"retirement savings number\"\". If you are making $100K per year now, you need to target $2.5M - PLUS allowance for inflation between now and when you plan to retire. This usually means you need to also arrange to make more money as well as save as much as you can and to use passive investing. Finance advisors are not worth it if you have less than $1M to invest.\"" }, { "docid": "486367", "title": "", "text": "As you point out, the main benefits of a pension/retirement account over a traditional cash/taxable account are the legal and tax benefits. Most Western countries establish a specific legal definition for an account which is often taxed less or not at all relative to taxable accounts and which contains some protection for the owner in case of a bankruptcy. The typical drawbacks for investing within such structures are limited investment choice, limited withdrawal rights (either in terms of age or rate of withdrawal), and maximum contributions. The benefits are usually very clear, and your decision whether or not to open a pension/retirement account should depend on a careful weighing of the benefits and drawbacks. As to whether you may end up with less than you started, that depends on what you invest in. As with all of finance, you must take more risk to get more return. Although the choices inside a pension/retirement account may be worded somewhat differently, they are usually fundamentally no different than some of the most popular investments available for ordinary taxable accounts." }, { "docid": "264023", "title": "", "text": "\"when you contribute to a 401k, you get to invest pre-tax money. that means part of it (e.g. 25%) is money you would otherwise have to pay in taxes (deferred money) and the rest (e.g. 75%) is money you could otherwise invest (base money). growth in the 401k is essentially tax free because the taxes on the growth of the base money are paid for by the growth in the deferred portion. that is of course assuming the same marginal tax rate both now and when you withdraw the money. if your marginal tax rate is lower in retirement than it is now, you would save even more money using a traditional 401k or ira. an alternative is to invest in a roth account (401k or ira). in which case the money goes in after tax and the growth is untaxed. this would be advantageous if you expect to have a higher marginal tax rate during retirement. moreover, it reduces tax risk, which could give you peace of mind considering u.s. marginal tax rates were over 90% in the 1940's. a roth could also be advantageous if you hit the contribution limits since the contributions are after-tax and therefore more valuable. lastly, contributions to a roth account can be withdrawn at any time tax and penalty free. however, the growth in a roth account is basically stuck there until you turn 60. unlike a traditional ira/401k where you can take early retirement with a SEPP plan. another alternative is to invest the money in a normal taxed account. the advantage of this approach is that the money is available to you whenever you need it rather than waiting until you retire. also, investment losses can be deducted from earned income (e.g. 15-25%), while gains can be taxed at the long term capital gains rate (e.g. 0-15%). the upshot being that even if you make money over the course of several years, you can actually realize negative taxes by taking gains and losses in different tax years. finally, when you decide to retire you might end up paying 0% taxes on your long term capital gains if your income is low enough (currently ~50k$/yr for a single person). the biggest limitation of this strategy is that losses are limited to 3k$ per year. also, this strategy works best when you invest in individual stocks rather than mutual funds, increasing volatility (aka risk). lastly, this makes filing your taxes more complicated since you need to report every purchase and sale and watch out for the \"\"wash sale\"\" rules. side note: you should contribute enough to get all the 401k matching your employer offers. even if you cash out the whole account when you want the money, the matching (typically 50%-200%) should exceed the 10% early withdrawal penalty.\"" }, { "docid": "93073", "title": "", "text": "You can invest more that 20,000 in Infrastructure bonds, however the tax benefit is only on 20,000. Further the interest earned is taxable. The best guaranteed post tax returns is on PPF. So invest a substantial sum in this. As your age group low you can afford to take risk and hence could also look at investing in ELSS [Mutual Fund]. A note on each of these investments: LIC: If you have taken any of the endowment / Money Back plan, remember the returns are very low around 5-6%. It would make more sense to buy a pure term plan at fraction of the cost and invest the remaining premium into even PPF or FD that would give you more return. NSC/Postal Savings: They are a good option, however the interest is taxable. There is a locking of 6 years. PPF: The locking is large 15 years although one can do partial withdrawals after 7 years. The interest is not taxable. ULIP: These are market linked plans with Insurance and balance invested into markets. The charges for initial few years is quite high, plus the returns are not comparable to the normal Mutual Funds. Invest in this only if one needs less paper and doesn't want to track things separately. ELSS/Mutual Fund: These offer good market returns, but there is a risk of market. As you are young you can afford to take the risk. Most of the ELSS have given average results that are still higher than FD or PPF. Pension Plan: This is a good way to accumulate for retirement. Invest some small amount in this and do not take any insurance on it. Go for pure equity as you can still take the risk. This ensures that you have a kit for retirement. Check out the terms and conditions as to how you need to purchase annuity at the term end etc." }, { "docid": "545759", "title": "", "text": "There are lots of sub-parts to your question. Let's takle them one at a time. Should I worry about an IRA at this age? Absolutely! Or at least some form of retirement account. When you are young is the BEST time to start putting money into a retirement account because you have so much time for it to grow. Compounding interest is a magical thing. Even if you can only afford to put a very small amount in the account, do it! You will have to put a heck of a lot less money into the account over your working career if you start now. Is there a certain amount you need for the IRA deduction? No. Essentially with a traditional IRA you can just subtract the amount you deposited (up to the contribution limit) from your income when calculating your taxes. What kind of IRA should I get? I suggest a ROTH IRA, but be warned that with that kind you get the tax breaks when you retire, not now. If you think taxes will be higher in 40 years or so, then the Roth is a clear winner. Traditional IRA: Tax deduction this year for contribution; investment plus gains are taxed as income when you take the money out at retirement. Roth IRA: Investment amount is taxed in the year you put it in; no taxes on investment amount or gains when you take it out at retirement. Given the long horizon that you will be investing, the money is likely going to at least double. So the total amount you are taxed on over your lifetime would probably be less with the ROTH even if tax rates remain the same. Is the 401K a better option? If they offer a match (most do) then it is a no-brainer, the employer 401K always comes out on top because they are basically paying you extra to put money into savings. If there is no match, I suggest a Roth because company 401K plans usually have hidden fees that are much higher than you are going to pay for setting up your own IRA or Roth IRA with a broker." }, { "docid": "47614", "title": "", "text": "If you can afford it, there are very few reasons not to save for retirement. The biggest reason I can think of is that, simply, you are saving in general. The tax advantages of 401k and IRA accounts help increase your wealth, but the most important thing is to start saving at an early age in your career (as you are doing) and making sure to continue contributing throughout your life. Compound interest serves you well. If you are really concerned that saving for retirement in your situation would equate to putting money away for no good reason, you can do a couple of things: Save in a Roth IRA account which does not require minimum distributions when you get past a certain age. Additionally, your contributions only (that is, not your interest earnings) to a Roth can be withdrawn tax and penalty free at any time while you are under the age of 59.5. And once you are older than that you can take distributions as however you need. Save by investing in a balanced portfolio of stocks and bonds. You won't get the tax advantages of a retirement account, but you will still benefit from the time value of money. The bonus here is that you can withdraw your money whenever you want without penalty. Both IRA accounts and mutual fund/brokerage accounts will give you a choice of many securities that you can invest in. In comparison, 401k plans (below) often have limited choices for you. Most people choose to use their company's 401k plan for retirement savings. In general you do not want to be in a position where you have to borrow from your 401k. As such it's not a great option for savings that you think you'd need before you retire. Additionally 401k plans have minimum distributions, so you will have to periodically take some money from the account when you are in retirement. The biggest advantage of 401k plans is that often employers will match contributions to a certain extent, which is basically free money for you. In the end, these are just some suggestions. Probably best to consult with a financial planner to hammer out all the details." }, { "docid": "482544", "title": "", "text": "You are not locked in to this percentage of new money forever, you may change it every paycheck. Pick a split that makes you feel comfortable. Then revisit how you allocate new money every year. If congress makes changes to the brackets; or your compensation changes; or the rules regarding retirement funds changes: adjust accordingly. Note that the Roth IRA came long after the IRA; and that the Roth 401K came long after the 401K. You have no idea what types of investments you will be able to contribute to with your next employer, or how your martial situation and income will change the scope of available retirement options. Heck you can even convert non-Roth to Roth in the future if that makes sense. Pick a percentage for now, but don't forget to revisit it." }, { "docid": "43781", "title": "", "text": "@Victor above has provided a very good answer, I shall try and highlight some differences. The differences are specific to a country, however, it does offer some insight regarding the difference between investing in retirement fund vis-a-vis investing in stock directly: In many countries the retirement fund is mandated by the govt. and has to be invested in (in form of direct deduction from salary) ~ Investing in stock is up to the individual In many cases (if not most) capital gain/interest accrual in retirement funds are not taxable ~ Depending upon current laws capital gain (long term/short term) from stocks are taxable Retirement funds are managed and are (in general) more stable in their returns ~ Returns from direct stock investments are dependent on investment decisions of the investor Retirement funds tend to, (though this is very country specific) return somewhat less than market, as an example, in India Public Provident Fund (PPF)/Employee Provident Fund (EPF) return 8.68% tax free ~ As for direct investment on stocks, Nifty has returned approx. 17% CAGR over 15-20 years. Given the above, if you can invest in stock by taking informed calls and you have a good understanding of the financial markets and their underpinning and (probably) looking at long term investment, then investing directly in stock could fetch returns that might not be paralled by retirement funds. If on the other hand, if you feel investing in stock is not for you, then it probably is better to stick with retirement funds and other low risk investments. Either way, you probably have to (and may be you should) carry some portion of your portfolio as retirement funds." }, { "docid": "110114", "title": "", "text": "All data for a single adult in tax year 2010. Roth IRA 401K Roth 401k Traditional IRA and your employer offers a 401k Traditional IRA and your employer does NOT offer a 401k So, here are your options. If you have a 401k at work, you could max that out. If you make close to $120K, you could reduce your AGI enough to contribute to a Roth IRA. If you do not have a 401k at work, you could contribute to a Traditional IRA and deduct the $5K from your AGI similar to how a 401k works. Other than that, I think you are looking at investing outside of a retirement plan which means more flexibility, but no tax advantage." }, { "docid": "29323", "title": "", "text": "For most people, the longer you have until retirement, the more beneficial a Roth IRA becomes. As you get closer to retirement, your income should be higher than what you earn now, pushing you to pay a higher tax rate than what you are currently at, even if tax rates don't change. You said you were fairly young. Let's assume you've got 35 years until retirement. Assume you make $50K right now, and earn a 4% raise each year. When you retire, a common goal is to live off of 80% of your pre-retirement income. 80% of your pre-retirement income will be $157K/year based on 4% raises and 35 years until retirement. I can't predict future tax rates, but it is likely to be a higher tax rate than what you are paying now. Say you invest $300.00 per month for 35 years at 9% interest (S&P 500 lifetime average is 10.5%). In 35 years, you'll have contributed $126,000. The account will be worth about $890,000. That means that you'll have $764,000 of gain. If you invested in a 401k, you'll pay taxes on every withdrawal from your $890,000 account, at your retirement rate. If you invested in a Roth, you'll pay taxes on your contributions of $126,000 and not pay taxes on the gains. This grants you some immunity from tax law changes or even large withdrawals to buy a house, boat, etc. during retirement. All of the taxes paid will be at your rate when investing." }, { "docid": "323934", "title": "", "text": "\"Open an investment account on your own and have them roll the old 401K accounts into either a ROTH or traditional IRA. Do not leave them in old 401k accounts and definitely don't roll them into your new employer's 401K. Why? Well, as great as 401K accounts are, there is one thing that employers rarely mention and the 401K companies actively try to hide: Most 401K plans are loaded with HUGE fees. You won't see them on your statements, they are often hidden very cleverly with accounting tricks. For example, in several plans I have participated in, the mutual fund symbols may LOOK like the ones you see on the stock tickers, but if you read the fine print they only \"\"approximate\"\" the underlying mutual fund they are named for. That is, if you multiply the number of shares by the market price you will arrive at a number higher than the one printed on your statement. The \"\"spread\"\" between those numbers is the fee charged by the 401K management company, and since employees don't pick that company and can't easily fire them, they aren't very competitive unless your company is really large and has a tough negotiator in HR. If you work for a small company, you are probably getting slammed by these fees. Also, they often charge fees for the \"\"automatic rebalancing\"\" service they offer to do annually to your account to keep your allocation in line with your current contribution allocations. I have no idea why it is legal for them not to disclose these fees on the statements, but they don't. I had to do some serious digging to find this out on my own and when I did it was downright scary. In one case they were siphoning off over 3% annually from the account using this standard practice. HOWEVER, that is not to say that you shouldn't participate in these plans, especially if there is an employer match. There are fees with any investment account and the \"\"free money\"\" your employer is kicking in almost always offsets these fees. My point here is just that you shouldn't keep the money in the 401K after you leave the company when you have an option to move it to an account with much cheaper fees.\"" }, { "docid": "534795", "title": "", "text": "401Ks and IRAs are types of retirement accounts. They have rules regarding maximum amount of investments per year; who can invest; destructibility; and the tax treatment of the growth. Stock, bonds, mutual funds, ETFs are all types of investments that can exist either inside or outside of the retirement account. Some 401Ks restrict the type of investments you can have, others allow you to own almost anything. Any investment is a risk, and there is no guarantee that it will grow. Look around the site for beginning investment advice. You should start with the 401K offered by your company especially if they have matching funds. That is free money. Many suggest you invest enough to get the match, then invest with an IRA. Look into IRAs because under US tax law you can still make a 2013 investment up until tax day 2014. Take the time before tax day to decide on Roth or Regular IRA. The more exotic investments take more time to understand and should not be a concern until you have laid out your basic retirement accounts." }, { "docid": "484149", "title": "", "text": "mhoran answered the headline question, but you asked - Could someone shed some light on and differentiate between a retirement account and alternative savings plans? Retirement accounts can contain nearly anything that one would consider an investment. (yes, there are exception, not the topic for today). So when one says they have an S&P fund or ETF, and some company issued Bonds, etc, these may or may not be held in a retirement account. In the US, when we say 'retirement account,' it means a bit more than just an account earmarked for that goal. It's an account, 401(k), 403(b), IRA, etc, that has a special tax status. Money can go in pre-tax, and be withdrawn at retirement when you are in a lower tax bracket. The Roth flavor of 401(k) or IRA lets you deposit post-tax money, and 'never' pay tax on it again, if withdrawn under specific conditions. In 2013, a single earner pays 25% federal tax on taxable earnings over $36K. But a retiree with exactly $46K in gross income (who then has $10K in standard deduction plus exemption) has a tax of $4950, less than 11% average rate on that withdrawal. This is the effect of the deductions, 10% and 15% brackets. As with your other question, there's a lot to be said about this topic, no one can answer in one post. That said, the second benefit of the retirement account is the mental partitioning. I have retirement money, not to be touched, emergency money used for the broken down car or appliance replacement, and other funds it doesn't feel bad to tap for spending, vacations, etc. Nothing a good spreadsheet can't handle, but a good way to keep things physically separate as well. (I answered as if you are in US, but the answer works if you rename the retirement accounts, eg, Canada has similar tax structure to the US.)" }, { "docid": "35680", "title": "", "text": "Yes, you should be saving for retirement. There are a million ideas out there on how much is a reasonable amount, but I think most advisor would say at least 6 to 10% of your income, which in your case is around $15,000 per year. You give amounts in dollars. Are you in the U.S.? If so, there are at least two very good reasons to put money into a 401k or IRA rather than ordinary savings or investments: (a) Often your employer will make matching contributions. 50% up to 6% of your salary is pretty common, i.e. if you put in 6% they put in 3%. If either of your employers has such a plan, that's an instant 50% profit on your investment. (b) Any profits on money invested in an IRA or 401k are tax free. (Effectively, the mechanics differ depending on the type of account.) So if you put $100,000 into an IRA today and left it there until you retire 30 years later, it would likely earn something like $600,000 over that time (assuming 7% per year growth). So you'd pay takes on your initial $100,000 but none on the $600,000. With your income you are likely in a high tax bracket, that would make a huge difference. If you're saying that you just can't find a way to put money away for retirement, may I suggest that you cut back on your spending. I understand that the average American family makes about $45,000 per year and somehow manages to live on that. If you were to put 10% of your income toward retirement, then you would be living on the remaining $171,000, which is still almost 4 times what the average family has. Yeah, I make more than $45,000 a year too and there are times when I think, How could anyone possibly live on that? But then I think about what I spend my money on. Did I really need to buy two new computer printers the last couple of months? I certainly could do my own cleaning rather than hiring a cleaning lady to come in twice a month. Etc. A tough decision to make can be paying off debt versus putting money into an investment account. If the likely return on investment is less than the interest rate on the loan, you should certainly concentrate on paying off the loan. But if the reverse is true, then you need to decide between likely returns and risk." }, { "docid": "513981", "title": "", "text": "All distributions from a regular (non-Roth) 401k are regular income. IRS: Distributions, including earnings, are includible in taxable income at retirement (except for qualified distributions of designated Roth accounts)." }, { "docid": "126756", "title": "", "text": "The main reasons are that investment are deducted from your gross income and earnings are not taxed until withdrawal. This applies to both traditional IRAs and 401Ks. Roth accounts have different rules but valuable benefits. My effective income tax rate is around 35%. This means that for every $1000 I earn in wage I only get to keep $650. Since my 401K contributions are deferred reductions from my income I can invest 35% more money into my 401K than I would be able to invest in a non-tax-advantaged account. Where I can invest $1000 into my 401K I would only be able to invest $650 into a non-advantaged account with the same wages. If I put $650 into an account yielding 10% then my one-year return on my income is $65 The 10% return on my $1000 is $100. Compared to what I would have been able to take home in the first place this makes my ROI $100/$650 = 15.3% Interest earned in non-advantaged accounts incurs taxes every year. Interest earned in advantaged accounts does not incur taxes until withdrawn. Compounding 10% annually for 20 years is significantly more than 6.5% compounded annually for 20 years. Imagine 10% on a 1000 investment with no additional cash flows over 20 year. The result is $6727, or 672%. Imagine your income tax rate does not reduce below 35%, your after-tax return is 4372, or %437 return. Now imagine you pay taxes every year on 10% take, so your take annually is only 6.5%... Now over 20 years you have $3523 (but you've already paid all taxes on this) and your return is %352 You have earned 24% more money because taxes were deferred until withdrawal! EDIT: Some tabular info for the commenters Your take home from the investment is $3752 because you have diligently paid your taxes every year on the earnings. Now, with the tax deferred until withdrawal! You then owe 35% tax on the withdrawal so you keep 7400 * .65 = $4810 $4810 versus $3750 means you have made an additional $1060, or 28%, from the compounding against tax-advantaged earnings. But Matthew! you say... Annual proceeds from your investments are not taxed at your income tax rate. This is true for now but the political winds are pushing this direction. However, even if you use a reduced rate in the first situation (let's say 30% instead of 35%, if you're a California resident) then the effect is $4140 rather than $3750. Less of a gain, but still a gain. In fact your capital-gains rate would have to be as low as 22% to even this difference out (versus a 35% income tax rate).... And remember that this assumes you're in the same bracket at retirement (which more people are not) You may also note that I used $1000 as the principle in both calculations. This was intentional to show the effects of compounding the taxable earnings alone. If you replace the taxable principle with $650 instead of $1000 then the effect is even more pronounced and only balanced out if your capital gains rate is actually zero!" } ]

[ { "docid": "366146", "title": "", "text": "I would say yes, it makes sense to keep some money in taxable accounts. Retirement accounts are for retirement, and the various early withdrawal penalties are designed to enforce that. If you're anticipating using the money before retirement (e.g., for home purchase), it makes sense to keep it out of retirement accounts. On the other hand, be aware that, regardless of what kind of account it is in, you face the usual risk/return tradeoff. If you put your money in the S&P 500 and the S&P 500 tanks just before you were going to buy a house, your down payment evaporates and you will have to wait and buy a house later. You can manage this by shifting the allocation of this money and perhaps cashing it out if a certain amount is gained (i.e., it grows to the level of your target down payment) and you are close enough to the house purchase time that you don't want to risk it anymore. Basically, if you invest money for a pre-retirement use, you may want to keep it in a taxable account, but you also need to take account of when you'll need it and manage the risk accordingly." } ]

[ { "docid": "280530", "title": "", "text": "Most people carry a diversity of stock, bond, and commodities in their portfolio. The ratio and types of these investments should be based on your goals and risk tolerance. I personally choose to manage mine through mutual funds which combine the three, but ETFs are also becoming popular. As for where you keep your portfolio, it depends on what you're investing for. If you're investing for retirement you are definitely best to keep as much of your investment as possible in 401k or IRAs (preferably Roth IRAs). Many advisers suggest contributing as much to your 401k as your company matches, then the rest to IRA, and if you over contribute for the IRA back to the 401k. You may choose to skip the 401k if you are not comfortable with the choices your company offers in it (such as only investing in company stock). If you are investing for a point closer than retirement and you still want the risk (and reward potential) of stock I would suggest investing in low tax mutual funds, or eating the tax and investing in regular mutual funds. If you are going to take money out before retirement the penalties of a 401k or IRA make it not worth doing. Technically a savings account isn't investing, but rather a place to store money." }, { "docid": "74041", "title": "", "text": "Ben Miller's answer is very thorough, and I up voted it. I believe that the ability to rebalance without tax implications is very import, but there are two aspects of the question that were not covered: The 401K in many cases comes with a company match. Putting enough money into the fund each year to maximize the match, give you free money that is not available in the non-retirement accounts. The presence of that match is to encourage employees to contribute: even if they are tying up their funds until retirement age; and they are into a plan with only a handful of investment options; and they may have higher expenses in the 401K. The question also had a concern about the annual limits for the 401K (18,000) and the IRA (5,500). The use of a retirement account doesn't in any way limit your ability to invest in non-retirement accounts. You can choose to invest from 0 to 23,500 in the retirement accounts and from 0 to unlimited into the non-retirement accounts. Double those amounts if you are married." }, { "docid": "475397", "title": "", "text": "There is no advantage to using one type of account or the other if you are in the same tax bracket at retirement that you are in during your working years. However, for tax planning reasons, it is good to have some money in both a Roth and a traditional IRA plan. JoeTaxpayer has often advocated a good rule of thumb to use a Roth when your tax bracket is 15% or lower, and use a traditional account when in the 25% bracket or above. The reason for this rule of thumb is that you are less likely to be in the higher tax bracket when you are living off retirement savings unless you put away an awful lot of money between now and then. If you are making enough money to be paying a 25% marginal rate on some of the money you would be putting away for retirement, then by all means, put all of that money in a traditional 401k. If after contributing that portion of your savings taxed at the higher rate, you still have money to put away for retirement, put the rest in a Roth and pay the 15% taxes on it. When you are younger, it is likely that you are making less than you will a few years hence, and it is also likely that a larger portion of your income will be paying tax deductible interest on a mortgage. If those are true for you, then by all means, use the Roth. That was true of me when I was single and just getting started. When you do finally retire, it is possible that the tax brackets will be increased to match inflation, and if so, then there is no benefit to having tax free money at retirement vs. paying taxes on deferred accounts, but there is also usually more flexibility in when to spend money. You may find that you have a year where you have to spend a lot, so it is good to be able to pull money out without it increasing your marginal rate for that year, and other years where you spend relatively smaller amounts, and you can withdraw taxable money and pay a lower rate on that money. No one knows what the tax code will look like in 40 years, but having some money in each type of account will give you flexibility to minimize your tax bill at retirement." }, { "docid": "66466", "title": "", "text": "I'm not the guy you're responding to, but you asked a good question. There's a dearth of data, but [about 1% is the estimate.] (http://www.businessinsurance.com/article/20110814/NEWS03/308149986#) Either way, having increased young adults on an insurance plan is a good thing. Socially, this demographic is exceptionally stinging from the Great Recession and I think the ability to give young adults health insurance (and thus the freedom to start developing a career without worrying about health coverage) outweighs the nominal additional premium costs. Fiscally, having young adults in a group plan decreases the risk profile of that plan since young adults don't incur the same expenses that a 45 or 50 year old would." }, { "docid": "59600", "title": "", "text": "It is really hard to tell where you should withdraw money from. So instead, I'll give you some pointers to make it easier for you to make the decision for yourself, while keeping the answer useful to others as well. I have 3 401ks, ... and some has post tax, non Roth money Why keeping 3 401ks? You can roll them over into an IRA or the one 401k which is still active (I assume here you're not currently employed with 3 different employers). This will also help you avoiding fees for too low balances on your IRAs. However, for the 401k with after tax (not Roth) balance - read the next part carefully. Post tax amounts are your basis. Generally, it is not a good idea to keep post-tax amounts in 401k/IRA, you usually do post-tax contributions to convert them to Roth ASAP. Withdrawing from 401k with basis may become a mess since you'll have to account for the basis portion of each withdrawal. Especially if you pool it with IRAs, so that one - don't rollover, keep it separately to make that accounting easier. I also have several smaller IRAs and Roth IRAs, Keep in mind the RMD requirements. Roth IRAs don't have those, and are non-taxable income, so you would probably want to keep them as long as possible. This is relevant for 401k as well. Again, consolidating will help you with the fees. I'm concerned about having easily accessible cash for emergencies. I suggest keeping Roth amounts for this purpose as they're easily accessible and bear no taxable consequence. Other than emergencies don't touch them for as long as you can. I do have some other money in taxable investments For those, consider re-balancing to a more conservative style, but beware of the capital gains taxes if you have a lot of gains accumulated. You may want consider loss-harvesting (selling the positions in the red) to liquidate investments without adverse tax consequences while getting some of your cash back into the checking account. In any case, depending on your tax bracket, capital gains taxes are generally lower (down to 0%) than ordinary income taxes (which is what you pay for IRA/401k withdrawals), so you would probably want to start with these, after careful planning and taking the RMD and the Social Security (if you're getting any) into account." }, { "docid": "136270", "title": "", "text": "The vanilla advice is investing your age in bonds and the rest in stocks (index funds, of course). So if you're 25, have 75% in stock index fund and 25% in bond index. Of course, your 401k is tax sheltered, so you want keep bonds there, assuming you have taxable investments. When comparing specific funds, you need to pay attention to expense ratios. For example, Vanguard's SP 500 index has an expense ratio of .17%. Many mutual funds charge around 1.5%. That means every year, 1.5% of the fund total goes to the fund manager(s). And that is regardless of up or down market. Since you're young, I would start studying up on personal finance as much as possible. Everyone has their favorite books and websites. For sane, no-nonsense investment advise I would start at bogleheads.org. I also recommend two books - This is assuming you want to set up a strategy and not fuss with it daily/weekly/monthly. The problem with so many financial strategies is they 1) don't work, i.e. try to time the market or 2) are so overly complex the gains are not worth the effort. I've gotten a LOT of help at the boglehead forums in terms of asset allocation and investment strategy. Good luck!" }, { "docid": "551403", "title": "", "text": "\"From a purely analytical standpoint, assuming you are investing your Roth IRA contributions in broad market securities (such as the SPDR S&P 500 ETF, which tracks the S&P 500), the broader market has historically had more upward movement than downward, and therefore a dollar invested today will have a greater expected value than a dollar invested tomorrow. So from this perspective, it is better to \"\"max out\"\" your Roth on the first day of the contribution year and immediately invest in broad market (or at least well diversified) securities. That being said, opportunity costs must also be taken into account--every dollar you use to fund your Roth IRA is a dollar that is no longer available to be invested elsewhere (hence, a lost opportunity). With this in mind, if you are currently eligible for a 401k in which your employer matches some portion of your contributions, it is generally advised that you contribute to the 401k up to the employer-match. For example, if your employer matches 75% of contributions up to 3.5% of your gross salary, then it is advisable that you first contribute this 3.5% to your 401k before even considering contributing to a Roth IRA. The reasoning behind this is two-fold: first, the employer-match can be considered as a guaranteed Return on Investment--so for example, for an employer that matches 75%, for every dollar you contribute you already have earned a 75% return up to the employer's limit. Secondly, 401k contributions have tax implications: not only is the money contributed to the 401k pre-tax (i.e., contributions are not taxed), it also reduces your taxable income, so the marginal tax benefit of these contributions must also be taken into account. Keep in mind that in the usual circumstances, 401k disbursements are taxable. Finally, many financial advisors will also suggest establishing an \"\"emergency fund\"\", which is money that you will not use unless you suffer an emergency that has an impact on your normal income--loss of job, medical emergency, etc. These funds are often kept in highly liquid accounts (savings accounts, money-market funds, etc.) so they can be accessed immediately when you run into one of \"\"life's little surprises\"\". Generally, it is advised that an emergency fund between $500-$1000 is established ASAP, and over time the emergency fund should be increased until it has reached a value equivalent to the sum of 8 months' worth of expenses. If funding an IRA is preventing you from working towards such an emergency fund, then you may want to consider waiting on maxing out the IRA before you have that EF established. Of course, it goes without saying that credit card balances with APRs other than 0.00% (or similar) should be paid off before an IRA is funded, since while you can only hope to match the market at best (between 10-15% a year) in your IRA investments, paying down credit card balances is an instant \"\"return\"\" of whatever the APR is, which usually tends to be between a 15-30% APR. In a nutshell, assuming you are maxing out your 401k (if applicable), have an emergency fund established, are not carrying any high-APR credit card balances, and are able to do so, historical price movements in the markets suggest that funding your Roth IRA upfront and investing these funds immediately in a broadly diversified portfolio will yield a higher expected return than funding the account periodically throughout the year (using dollar cost averaging or similar strategies). If this is not the case, take some time to consider the opportunity costs you are incurring from not fully contributing to your 401k, carrying high credit card balances, or not having a sufficient emergency fund established. This is not financial advice specific to any individual and your mileage may vary. Consider consulting a Certified Financial Planner, Certified Public Accountant, etc. before making any major financial decisions.\"" }, { "docid": "302453", "title": "", "text": "\"On #1: One way to make it less painful is to \"\"split\"\" your raises between yourself and your 401k. That is, if you get a 2% raise, increase your contribution to the 401K by 1% and keep the other 1%. Keep doing this until you are maxed out. You won't miss money you never had nearly as much as money you were used to living on. On #2: Yes, go with the Roth. Another consideration: If you are ever going to max out your 401K it is best to do it early even if you have to cut back later than to wait. Take advantage of the extra investment time while you are young.\"" }, { "docid": "371176", "title": "", "text": "First, you need to understand the difference in discussing types of investments and types of accounts. Certificate of Deposits (CDs), money market accounts, mutual funds, and stocks are all examples of types of investments. 401(k), IRA, Roth IRA, and taxable accounts are all examples of types of accounts. In general, those are separate decisions to make. You can invest in any type of investment inside any type of account. So your question really has two different parts: Tax-advantaged retirement accounts vs. Standard taxable accounts FDIC-insured CDs vs. at-risk investments (such as stock mutual funds) Retirement accounts are special accounts allowed by the federal government that allow you to delay (or, in some cases, completely avoid) paying taxes on your investment. The trade-off for these accounts is that, in general, you cannot access any of the money that you put into these accounts until you get to retirement age without paying a steep penalty. These accounts exist to encourage citizens to save for their own retirement. Examples of retirement accounts include 401(k) and IRAs. Standard taxable accounts have no tax advantages, but no restrictions, either. You can put money in and take money out whenever you like. However, anything that your investment earns is taxable each year. Inside any of these accounts, you can invest in FDIC-insured bank accounts, such as savings accounts or CDs, or you can invest in any number of non-insured investments, including money market accounts, bonds, mutual funds, stocks, precious metals, etc. Something you need to understand about investing in general is that your potential returns are directly related to the amount of risk that you take on. Investing in an insured investment, which is guaranteed by the government to never lose its value, will result in the lowest potential investment returns that you can get. Interest-bearing savings accounts are currently paying less than 1% interest. A CD will get you a slightly higher interest rate in exchange for you agreeing not to withdraw your money for a period of time. However, it takes a long time for your investments to grow with these investments. If you are earning 1%, it takes 72 years for your investment to double. If you are willing to take some risk, you can earn much more with your investments. Bonds are often considered quite safe; with a bond, you loan money to a government or corporation, and they pay you back with interest. The risk comes from the possibility that the government or corporation won't pay you back, so it is important to choose a bond from an entity that you trust. Stocks are shares in for-profit companies. Your potential investment gain is unlimited, but it is risky, as stocks can go down in value, and companies can close. However, it is important to note that if you take the largest 500 stocks together (S&P 500), the average value has consistently gone up over the long term. In the last 35 years, this average value has gone up about 11%. At this rate, your investment would double in less than 7 years. To avoid the risk of picking a losing stock, you can invest in a mutual fund, which is a collection of stocks, bonds, or other investments. The idea is that you can, with one investment, invest in many stocks, essentially earning the average performance of all the stocks. There is still risk, as the market can be down as a whole, but you are insulated from any one stock being bad because you are diversified. If you are investing for something in the long-term future, such as retirement, stock mutual funds provide a good rate of return at an acceptably-low level of risk, in my opinion." }, { "docid": "130118", "title": "", "text": "I'm afraid you're mistaking 401k as an investment vehicle. It's not. It is a vehicle for retirement. Roth 401k/IRA has the benefit of tax free distributions at retirement, and as long as you're in the low tax bracket - it is for your benefit to take advantage of that. However, that is not the money you would be using to start a business or buy a home (except for maybe up to $10K you can withdraw without penalty for first time home buyers, but I wouldn't bother with $10k, if that's what will help you buying a house - maybe you shouldn't be buying at all). In addition, you should make sure you take advantage of the employer 401k match in full. That is free money added to your Traditional 401k retirement savings (taxed at distribution). Once you took the full advantage of the employer's match, and contributed as much as you consider necessary for your retirement above that (there are various retirement calculators on line that can help you in making that determination), everything else will probably go to taxable (regular) savings/investments." }, { "docid": "262322", "title": "", "text": "\"Assuming you are below retirement age, you typically cannot roll money from a Roth IRA into a 401k nor transfer money out of a 401k until you leave the company. Your best bet is to leave your exising roth ira separate from your 401k. A good strategy for retirement accounts is whenever able (typically when you switch jobs) roll your 401k into a \"\"rollover IRA\"\" (not a roth). Then you can manage your investments with more options than the 5-20 funds provided in the 401k. I would recommend against rolling funds into a 401k because of the lack of options in most 401k plans. Also, 401k is pre-tax and Roth is post-tax. Pre and post tax investments don't mix before withdrawal unless you do a conversion of some kind.\"" }, { "docid": "35680", "title": "", "text": "Yes, you should be saving for retirement. There are a million ideas out there on how much is a reasonable amount, but I think most advisor would say at least 6 to 10% of your income, which in your case is around $15,000 per year. You give amounts in dollars. Are you in the U.S.? If so, there are at least two very good reasons to put money into a 401k or IRA rather than ordinary savings or investments: (a) Often your employer will make matching contributions. 50% up to 6% of your salary is pretty common, i.e. if you put in 6% they put in 3%. If either of your employers has such a plan, that's an instant 50% profit on your investment. (b) Any profits on money invested in an IRA or 401k are tax free. (Effectively, the mechanics differ depending on the type of account.) So if you put $100,000 into an IRA today and left it there until you retire 30 years later, it would likely earn something like $600,000 over that time (assuming 7% per year growth). So you'd pay takes on your initial $100,000 but none on the $600,000. With your income you are likely in a high tax bracket, that would make a huge difference. If you're saying that you just can't find a way to put money away for retirement, may I suggest that you cut back on your spending. I understand that the average American family makes about $45,000 per year and somehow manages to live on that. If you were to put 10% of your income toward retirement, then you would be living on the remaining $171,000, which is still almost 4 times what the average family has. Yeah, I make more than $45,000 a year too and there are times when I think, How could anyone possibly live on that? But then I think about what I spend my money on. Did I really need to buy two new computer printers the last couple of months? I certainly could do my own cleaning rather than hiring a cleaning lady to come in twice a month. Etc. A tough decision to make can be paying off debt versus putting money into an investment account. If the likely return on investment is less than the interest rate on the loan, you should certainly concentrate on paying off the loan. But if the reverse is true, then you need to decide between likely returns and risk." }, { "docid": "423754", "title": "", "text": "\"I don't think you have your head in the right space - you seem to be thinking of these lifecycle funds like they're an annuity or a pension, but they're not. They're an investment. Specifically, they're a mutual fund that will invest in a collection of other mutual funds, which in turn invest in stock and bonds. Stocks go up, and stocks go down. Bonds go up, and bonds go down. How much you'll have in this fund next year is unknowable, much less 32 years from now. What you can know, is that saving regularly over the next 32 years and investing it in a reasonable, and diversified way in a tax sheltered account like that Roth will mean you have a nice chunk of change sitting there when you retire. The lifecycle funds exist to help you with that \"\"reasonable\"\" and \"\"diversified\"\" bit.They're meant to be one stop shopping for a retirement portfolio. They put your money into a diversified portfolio, then \"\"age\"\" the portfolio allocations over time to make it go from a high risk, (potentially) high reward allocation now to a lower risk, lower reward portfolio as you approach retirement. The idea is is that you want to shoot for making lots of money now, but when you're older, you want to focus more on keeping the money you have. Incidentally, kudos for getting into seriously saving for retirement when you're young. One of the biggest positive effects you can have on how much you retire with is simply time. The more time your money can sit there, the better. At 26, if you're putting away 10 percent into a Roth, you're doing just fine. If that 5k is more than 10 percent, you'll do better than fine. (That's a rule of thumb, but it's based on a lot of things I've read where people have gamed out various scenarios, as well as my own, cruder calculations I've done in the past)\"" }, { "docid": "406239", "title": "", "text": "The benefit is that your earnings in the 401k are not subject to income tax until you make withdrawals. This allows you to grow your money faster than if you made equivalent investments in a taxable account and had to pay taxes on dividends and capital gains along the way. Also, the theory is that you will be in a lower tax bracket in retirement and thus you will pay lower taxes overall. If this is not true (especially if you will be in a higher tax bracket in retirement), then there may not be any advantage for you to contribute to a 401k. One advantage over the Traditional IRA is the higher contribution limit. Some 401k plans also allow you to take loans from the plan, I don't think this is possible with a Traditional IRA. An alternative to both the 401k and Traditional IRA is the Roth version of either plan. With a Roth, you pay taxes up front, but your withdrawals during retirement are tax free." }, { "docid": "518266", "title": "", "text": "FASFA financial aid formulas determine 'expected family contribution'. For example my alma mater now has a 'list price of over $65k/year. The average student today actually pays $42k/year after grants. Students with rich parents pay more than that. Students with poor parents pay less than that. Lets say list prices for my kids colleges average $110k/year while they are in school. If we 'only' make $200k then based on our income alone, EFC would start in the low $50ks per year. If we have $1M saved in taxable accounts, 529s, rental properties, etc, then we also have to pay 5.64% of the value of those every year for the eight years my kids will be attending - an *extra* $56.4k/year every year for 8 years. If that $1M is in assets that don't count such as retirement accounts and equity in primary residence, then it doesn't increase the price my kids are billed. That's a pretty big incentive to put everything I can in home equity, Roth IRA, Spousal Roth IRA, traditional 401k, after-tax 401k, and HSA. If I could afford to save more I'd switch from traditional to Roth 401k and pre-pay retirement taxes at a higher marginal rate rather than have the savings on the side subjected to the college wealth/income taxes which are effectively a much higher difference between the 25% (now) and 15% (later) federal tax brackets. Profile and consensus formulas have slightly different percentages and count some home equity if you have an expensive house, but the general idea is the same." }, { "docid": "192738", "title": "", "text": "When you are investing for 40 years, you will have taxable events before retirement. You'll need to pay tax along the way, which will eat away at your gains. For example, in your taxable account, any dividends and capital gain distributions will need taxes paid each year. In your 401(k) or IRA, these are not taxable until retirement. In addition, what happens if you want to change investments before retirement? In your taxable account, taxes on the capital gains will be due at that time, but in a retirement account, you can change investments anytime you like without having to pay taxes early. Finally, when you do pull money out of your 401(k) at retirement, it will be taxed at whatever your tax rate is at retirement. After you retire, your income will probably be lower than when you were working, so your tax rate might be less." }, { "docid": "43781", "title": "", "text": "@Victor above has provided a very good answer, I shall try and highlight some differences. The differences are specific to a country, however, it does offer some insight regarding the difference between investing in retirement fund vis-a-vis investing in stock directly: In many countries the retirement fund is mandated by the govt. and has to be invested in (in form of direct deduction from salary) ~ Investing in stock is up to the individual In many cases (if not most) capital gain/interest accrual in retirement funds are not taxable ~ Depending upon current laws capital gain (long term/short term) from stocks are taxable Retirement funds are managed and are (in general) more stable in their returns ~ Returns from direct stock investments are dependent on investment decisions of the investor Retirement funds tend to, (though this is very country specific) return somewhat less than market, as an example, in India Public Provident Fund (PPF)/Employee Provident Fund (EPF) return 8.68% tax free ~ As for direct investment on stocks, Nifty has returned approx. 17% CAGR over 15-20 years. Given the above, if you can invest in stock by taking informed calls and you have a good understanding of the financial markets and their underpinning and (probably) looking at long term investment, then investing directly in stock could fetch returns that might not be paralled by retirement funds. If on the other hand, if you feel investing in stock is not for you, then it probably is better to stick with retirement funds and other low risk investments. Either way, you probably have to (and may be you should) carry some portion of your portfolio as retirement funds." }, { "docid": "199970", "title": "", "text": "Definitely not. You are too young. Let me explain: Your money will be locked up for at least 40 years, and you will have to navigate some really quirky and trap-laden rules in order to get money for simple things. Let's say you want to buy a house. You won't be able to leverage the 401K for that. College Tuition? Limits. Your money is locked in and you may get some match, but that assumes your smartest decision at your age is to save money for retirement. At your age, you should be investing in your career, and that requires cash at hand. If you want to withdraw early you pay more of a penalty than just the tax rate. Put differently: investing in your human capital, at a young age, can yield stronger results than just squirreling money. I'd say don't worry until you are 30. BTW: I'm 24 now. I used to save money in a 401K for a few months, before I understood the rules. Since then, I decided against 401K and just saved the money in a bank. After a few years, I had enough to start my business :) the 401K couldn't give me that opportunity. Further Explanation: I am in the NYC area. Many of my friends and I had to decide between living in manhattan or choosing to live in the outer boroughs or NJ. One thing I noticed was that, while the people in manhattan were burning much more money (to the tune of 1500 per month), they were actually much more productive and were promoted more often. Having lived in brooklyn and in manhattan, even though it is less expensive, you actually lose at least an hour a day thanks to the commute (and have to deal with crap like the 6 train). Personally, after moving in, I invested the extra time in myself (i.e. sleeping more, working longer hours, side projects). Now, when all is said and done, the people who decided to invest in themselves in the short term are financially more secure (both job-wise and economically, thanks to a few bonus cycles) than those who decided to save on rent and put it in a 401K. As far as the traps are concerned, my dad tried to take out a student loan and was denied thanks to a Vanguard quirk which didnt allow more than 50K to be borrowed (even though the account had over 500K to begin with)." }, { "docid": "260677", "title": "", "text": "Hopefully this $1000 is just a start, and not the last investment you will ever make. Assuming that, there are a couple of big questions to consider: One: What are you saving for? Are you thinking that this is for retirement 40 or 50 years from now, or something much sooner, like buying a car or a house? You didn't say where you live. In the U.S., if you put money into an IRA or a 401k or some other account that the government classes as a retirement account, you don't pay taxes on the profits from the investment, only on the original principal. If you leave the money invested for a long period of time, the profits can be many times the original investment, so this makes a huge difference. Like suppose that you pay 15% of your income in state and local taxes. And suppose you invest your $1000 in something that gives a 7% annual return and leave it there for 40 years. (Of course I'm just making up numbers for an example, but I think these are in a plausible range. And I'm ignoring the difference between regular income tax and capital gains tax, etc etc. It doesn't change the point.) If you put the money in a classic IRA, you pay 0% taxes the year you open the account, so you have your full $1000, figure that compound interest for 40 years, you'll end up with -- crunch crunch crunch the numbers -- $14,974. Then you pay 15% when you take it leaving you with $12,728. (The end result with a Roth IRA is exactly the same. Feel free to crunch those numbers.) But now suppose you invest in a no-retirement account so you have to pay taxes every year. Your original investment is only $850 because you have to pay tax on that, and your effective return is only 5.95% because you have to pay 15% of the 7%. So after 40 years you have -- crunch crunch -- $10,093. Quite a difference. But if you put money in a retirement account and then take it out before you retire, you pay substantial penalties. I think it's 20%. If you plan to take the money out after a year or two, that would really hurt. Two: How much risk are you willing to take? The reality of investment is that, almost always, the more risk you take, the bigger the potential returns, and vice versa. Investments that are very safe tend to have very low returns. As you're young, if you're saving for retirement, you can probably afford a fairly high amount of risk. If you lose a lot of money this year, odds are you'll get it back over the next few years, or at least be able to put more money into investments to make up for it. If you're 64 and planning to retire next year, you want to take very low-risk investments. In general, investing in government bonds is very safe but has very low returns. Corporate bonds are less safe but offer higher returns. Stocks are a little more. Of course different companies have different levels of risk: new start-ups tend to be very risky, but can give huge returns. Commodities are much higher risk. Buying on margin or selling short are ways to really leverage your money, but you could end up losing more than you invested. Mutual funds are a relatively safe way to invest in stocks and bonds because they spread your risk over many companies. Three: How much effort are you willing to put into managing your investments? How much do you know about the stock market and the commodities market and international finance and so on, and how much are you willing to learn? If your answer is that you know a lot about these things or are willing to dive in and learn a lot, that you can invest in individual stocks, bonds, commodities, etc. If your answer is that you really don't know much about all this, then it makes a lot of sense to just put your money into a mutual fund and let the people who manage the fund do all the work." } ]

[ { "docid": "526383", "title": "", "text": "First off, great job on your finances so far. You are off on the right foot and have some sense of planning for the future. Also, it is a great question. First, I agree with @littleadv. Take advantage of your employer match. Do not drop your 401(k) contributions below that. Also, good job on putting your contributions into the Roth account. Second, I would ask: Are you out of debt? If not, put all your extra income towards paying off debt, and then you can work your plan. Third, time to do some math. What will your business look like? How much capital would you need to get started? Are there things you can do now on a part-time basis to start this business or prepare you to start the business? Come up with a figure, find some mutual funds that have a low beta, and back out how much money you need to save per month, so you have around that total. Then you have a figure. e.g. Assume you need $20,000, and you find a fund that has done 8% over the past 20 years. Then, you would need to save about $110/month to be ready to go in 10 years, or $273/month to go in about 5 years. (It's a time value of money calculation.) The house is really a long way off, but you could do the same kind of calculation. I feel that you think your income, and possibly locale, will change dramatically over the next few years. It might not be bad to double what you are saving for the business, and designate one half for the house." } ]

[ { "docid": "15841", "title": "", "text": "I have worked for companies that have done this. One did have a match and the other did not. When they figured their profit at the end of the year a portion was given to the employees as a 401K deposit. retirement-topics-401k-and-profit-sharing-plan-contribution-limits Total annual contributions (annual additions) to all of your accounts in plans maintained by one employer (and any related employer) are limited. The limit applies to the total of: elective deferrals employer matching contributions employer nonelective contributions allocations of forfeitures The annual additions paid to a participant’s account cannot exceed the lesser of: 100% of the participant's compensation, or $54,000 ($60,000 including catch-up contributions) for 2017; $53,000 ($59,000 including catch-up contributions) for 2016. So as long as everything stays below that $54,000 limit you are good. In one case the decision was made by the company for the employee, the other company gave us the option of bonus check or 401K. I heard that most of the employees wanted the money in the 401K." }, { "docid": "371176", "title": "", "text": "First, you need to understand the difference in discussing types of investments and types of accounts. Certificate of Deposits (CDs), money market accounts, mutual funds, and stocks are all examples of types of investments. 401(k), IRA, Roth IRA, and taxable accounts are all examples of types of accounts. In general, those are separate decisions to make. You can invest in any type of investment inside any type of account. So your question really has two different parts: Tax-advantaged retirement accounts vs. Standard taxable accounts FDIC-insured CDs vs. at-risk investments (such as stock mutual funds) Retirement accounts are special accounts allowed by the federal government that allow you to delay (or, in some cases, completely avoid) paying taxes on your investment. The trade-off for these accounts is that, in general, you cannot access any of the money that you put into these accounts until you get to retirement age without paying a steep penalty. These accounts exist to encourage citizens to save for their own retirement. Examples of retirement accounts include 401(k) and IRAs. Standard taxable accounts have no tax advantages, but no restrictions, either. You can put money in and take money out whenever you like. However, anything that your investment earns is taxable each year. Inside any of these accounts, you can invest in FDIC-insured bank accounts, such as savings accounts or CDs, or you can invest in any number of non-insured investments, including money market accounts, bonds, mutual funds, stocks, precious metals, etc. Something you need to understand about investing in general is that your potential returns are directly related to the amount of risk that you take on. Investing in an insured investment, which is guaranteed by the government to never lose its value, will result in the lowest potential investment returns that you can get. Interest-bearing savings accounts are currently paying less than 1% interest. A CD will get you a slightly higher interest rate in exchange for you agreeing not to withdraw your money for a period of time. However, it takes a long time for your investments to grow with these investments. If you are earning 1%, it takes 72 years for your investment to double. If you are willing to take some risk, you can earn much more with your investments. Bonds are often considered quite safe; with a bond, you loan money to a government or corporation, and they pay you back with interest. The risk comes from the possibility that the government or corporation won't pay you back, so it is important to choose a bond from an entity that you trust. Stocks are shares in for-profit companies. Your potential investment gain is unlimited, but it is risky, as stocks can go down in value, and companies can close. However, it is important to note that if you take the largest 500 stocks together (S&P 500), the average value has consistently gone up over the long term. In the last 35 years, this average value has gone up about 11%. At this rate, your investment would double in less than 7 years. To avoid the risk of picking a losing stock, you can invest in a mutual fund, which is a collection of stocks, bonds, or other investments. The idea is that you can, with one investment, invest in many stocks, essentially earning the average performance of all the stocks. There is still risk, as the market can be down as a whole, but you are insulated from any one stock being bad because you are diversified. If you are investing for something in the long-term future, such as retirement, stock mutual funds provide a good rate of return at an acceptably-low level of risk, in my opinion." }, { "docid": "411354", "title": "", "text": "If you leave your job with money that you contributed to the 401K, the company will have a policy about whether you can leave the money in the 401K or whether you must take it with you. I have normally seen that if it is a small amount, then it must be taken and if it is over a certain amount (maybe $10K) then you have the option of leaving it in the account or taking it out. If you take it out, then you should contact a brokerage first and get instructions from them for how to have it transferred into a rollover account to avoid having to pay tax. If the company makes the check out to you or transfers money into a non-retirement account, then they will very easily cause a taxable event and they will likely withhold tax from the payment. If you leave the money in the 401K after you leave, you will generally have fewer investment choices, higher fees, and you may have higher risks. Occasionally companies in hard times fraudulently raid their 401K accounts and when this happens it can be very difficult to get it back. (For examples see the Dept Of Labor page at http://www.dol.gov/ebsa/newsroom/criminal/main.html and look for 401k or retirement in titles). As far as having the money invested for several years, that time can be your friend if you get a reasonable rate of return. Over 30 years your money should be able to double multiple times. (At 8% return it will take less than 10 years to double the money. [see http://buyupside.com/calculators/doublemoneyfeb08.htm])" }, { "docid": "43781", "title": "", "text": "@Victor above has provided a very good answer, I shall try and highlight some differences. The differences are specific to a country, however, it does offer some insight regarding the difference between investing in retirement fund vis-a-vis investing in stock directly: In many countries the retirement fund is mandated by the govt. and has to be invested in (in form of direct deduction from salary) ~ Investing in stock is up to the individual In many cases (if not most) capital gain/interest accrual in retirement funds are not taxable ~ Depending upon current laws capital gain (long term/short term) from stocks are taxable Retirement funds are managed and are (in general) more stable in their returns ~ Returns from direct stock investments are dependent on investment decisions of the investor Retirement funds tend to, (though this is very country specific) return somewhat less than market, as an example, in India Public Provident Fund (PPF)/Employee Provident Fund (EPF) return 8.68% tax free ~ As for direct investment on stocks, Nifty has returned approx. 17% CAGR over 15-20 years. Given the above, if you can invest in stock by taking informed calls and you have a good understanding of the financial markets and their underpinning and (probably) looking at long term investment, then investing directly in stock could fetch returns that might not be paralled by retirement funds. If on the other hand, if you feel investing in stock is not for you, then it probably is better to stick with retirement funds and other low risk investments. Either way, you probably have to (and may be you should) carry some portion of your portfolio as retirement funds." }, { "docid": "74041", "title": "", "text": "Ben Miller's answer is very thorough, and I up voted it. I believe that the ability to rebalance without tax implications is very import, but there are two aspects of the question that were not covered: The 401K in many cases comes with a company match. Putting enough money into the fund each year to maximize the match, give you free money that is not available in the non-retirement accounts. The presence of that match is to encourage employees to contribute: even if they are tying up their funds until retirement age; and they are into a plan with only a handful of investment options; and they may have higher expenses in the 401K. The question also had a concern about the annual limits for the 401K (18,000) and the IRA (5,500). The use of a retirement account doesn't in any way limit your ability to invest in non-retirement accounts. You can choose to invest from 0 to 23,500 in the retirement accounts and from 0 to unlimited into the non-retirement accounts. Double those amounts if you are married." }, { "docid": "10089", "title": "", "text": "Congratulations on deciding to save for retirement. Since you cite Dave Ramsey as the source of your 15% number, what does he have to say about where to invest the money? If you want to have instantaneous penalty-free access to your retirement money, all you need to do is set up one or more ordinary accounts that you think of as your retirement money. Just be careful not to put the money into CDs since Federal law requires a penalty of three months interest if you cash in the CD before its maturity date (penalty!) or put the money into those pesky mutual funds that charge a redemption fee (penalty!) if you take the money out within x months of investing it where x can be anywhere from 3 to 24 or more. In Federal tax law (and in most state tax laws as well) a retirement account has special privileges accorded to it in that the interest, dividends, capital gains, etc earned on the money in your retirement account are not taxed in the year earned (as they would be in a non-retirement account), but the tax is either deferred till you withdraw money from the account (Traditional IRAs, 401ks etc) or is waived completely (Roth IRAs, Roth 401ks etc). In return for this special treatment, penalties are imposed (in addition to tax) if you withdraw money from your retirement account before age 59.5 which presumably is on the distant horizon for you. (There are some exceptions (including first-time home buying and extraordinary medical expenses) to this rule that I won't bother going into). But You are not required to invest your retirement money into such a specially privileged retirement account. It is perfectly legal to keep your retirement money in an ordinary savings account if you wish, and pay taxes on the interest each year. You can invest your retirement money into municipal bonds whose interest is free of Federal tax (and usually free of state tax as well if the municipality is located in your state of residence) if you like. You can keep your retirement money in a sock under your mattress if you like, or buy a collectible item (e.g. a painting) with it (this is not permitted in an IRA), etc. In short, if you are concerned about the penalties imposed by retirement accounts on early withdrawals, forgo the benefits of these accounts and put your retirement money elsewhere where there is no penalty for instant access. If you use a money management program such as Mint or Quicken, all you need to do is name one or more accounts or a portfolio as MyRetirementMoney and voila, it is done. But those accounts/portfolios don't have to be retirement accounts in the sense of tax law; they can be anything at all." }, { "docid": "537049", "title": "", "text": "I'm a series 24 securities principle and have explained and trained people on questions like these more times than I can count. Although, my first recommendation is to speak to a qualified tax professional for the appropriate answer for each individual scenario. Disclosure aside, the source of truth for these questions is always the IRS publications. In this case it's IRS pub 590b: When Must You Withdraw Assets? (Required Minimum Distributions). IRA stands for Individual Retirement Arrangement. Basically it's an arrangement between you a the government to encourage retirement savings. Tax payers(up to a define taxable income amount) agree to receive a deduction during your working years lowering your taxable income in the present. Your taxable income should drop in retirement because you're not working anymore and any withdraws would most likely be taxed at a lower rate. To be clear the require minimum distribution is based on a life expectancy factor and the ending balance of your pre-tax retirement accounts from the prior year(for ex. 2016 ending balance for a 2017 rmd). The rmd works out to be somewhere around 3-4% of your total balance. Most retirement account providers(if not all) have established several conveniences to automate the withdraw process. I've believe that moving funds directly to bank deposits or moving the funds to another taxable investment account are most common. Retirement account providers are required by law to give you notifications about RMDs. Some big firms allow you to setup an auto-distribution a year before you turn 70.5 to start when they need to. Because of the 50% penalty you're given so many notifications about an RMD that it's hard to forget about it." }, { "docid": "104793", "title": "", "text": "This situation, wanting desperately to have access to an investment vehicle in a 401K, but it not being available reminds me of two suggestions some make regarding retirement investing: This allows you the maximum flexibility in your retirement investing. I have never, in almost 30 years of 401K investing, seen a pure cash investment, is was always something that was at its core very short term bonds. The exception is one company that once you had a few thousand in the 401K, you could transfer it to a brokerage account. I have no idea if there was a way to invest in a money market fund via the brokerage, but I guess it was possible. You may have to look and see if the company running the 401K has other investment options that your employer didn't select. Or you will have to see if other 401K custodians have these types of investments. Then push for changes next year. Regarding external IRA/Roth IRA: You can buy a CD with FDIC protection from funds in an IRA/Roth IRA. My credit union with NCUA protection currently has CDs and even bump up CDs, minimum balance is $500, and the periods are from 6 months to 3 years." }, { "docid": "403103", "title": "", "text": "The primary advantage of an IRA or 401k is you get taxed effectively one time on the money (when you contribute for Roth, or when you withdraw for Traditional), whereas you get taxed effectively multiple times on some of the money in a taxable account (on all the money when you contribute, plus on the earnings part when you withdraw). Of course, you have to be able to withdraw without penalty for it to be optimally advantageous. And you said you want to retire decades early, so that is probably not retirement age. However, withdrawing early does not necessarily mean you have a penalty. For example: you can withdraw contributions to a Roth IRA at any time without tax or penalty; Roth 401k can be rolled over into Roth IRA; other types of accounts can be converted to Roth IRA and the principal of the conversion can be withdrawn after 5 years without penalty." }, { "docid": "391835", "title": "", "text": "I could see doing this if the investments were via different environments. The choices in a 401K are limited by the plan, so you might want to put new money into the 401K index fund. At the same time you could have IRA money invested in a similar index. You could even have non-retirement money invested. While you should look at all your investments while evaluating your investment percentages, the 401K (limited options) and the non-retirement account (avoiding taxes) might be harder to move around. Otherwise the only advantage of splitting between funds is avoiding having all your money in a Ponzi scheme." }, { "docid": "127838", "title": "", "text": "Saving for college you have a couple of options. 529 plans are probably the best bet for most people wanting to save for their kids college education. You can put a lot of money away ~$300k and you may get a state tax deduction. The downside is if you're kid doesn't go to college you may end up eating the 10% penalty. State specific prepaid tuition plans. The upside is you know roughly the return you are going to get on your money. The downside is your kid has to go to a state school in the state you prepaid or there are likely withdrawal penalties. For the most part these really aren't that great of a deal any more. ESAs are also an option but they only allow you to contribute $2k/year, but you have more investment options than with the 529 plans. Traditional and ROTH IRA accounts can also be used to pay for higher education. I wouldn't recommend this route in general but if you maxed out your 401k and weren't using your IRA contribution limits you could put extra money here and get more or really different flexibility than you can with a 529 account. I doubt IRA's will ever be asked for on a FAFSA which might be helpful. Another option is to save the money in a regular brokerage account. You would have more flexibility, but lower returns after taxes. One advantage to this route is if you think your kid might be borderline for financial aid a year or two before he starts college you could move this money into another investment that doesn't matter for financial aid purposes. A few words of caution, make sure you save for retirement before saving for your kids college. He can always get loans to pay for school but no one is going to give you a loan to pay for your retirement. Also be cautious with the amount of money you give your adult child, studies have shown that the more money that parents give their adult children the less successful they are compared to their peers." }, { "docid": "136270", "title": "", "text": "The vanilla advice is investing your age in bonds and the rest in stocks (index funds, of course). So if you're 25, have 75% in stock index fund and 25% in bond index. Of course, your 401k is tax sheltered, so you want keep bonds there, assuming you have taxable investments. When comparing specific funds, you need to pay attention to expense ratios. For example, Vanguard's SP 500 index has an expense ratio of .17%. Many mutual funds charge around 1.5%. That means every year, 1.5% of the fund total goes to the fund manager(s). And that is regardless of up or down market. Since you're young, I would start studying up on personal finance as much as possible. Everyone has their favorite books and websites. For sane, no-nonsense investment advise I would start at bogleheads.org. I also recommend two books - This is assuming you want to set up a strategy and not fuss with it daily/weekly/monthly. The problem with so many financial strategies is they 1) don't work, i.e. try to time the market or 2) are so overly complex the gains are not worth the effort. I've gotten a LOT of help at the boglehead forums in terms of asset allocation and investment strategy. Good luck!" }, { "docid": "262322", "title": "", "text": "\"Assuming you are below retirement age, you typically cannot roll money from a Roth IRA into a 401k nor transfer money out of a 401k until you leave the company. Your best bet is to leave your exising roth ira separate from your 401k. A good strategy for retirement accounts is whenever able (typically when you switch jobs) roll your 401k into a \"\"rollover IRA\"\" (not a roth). Then you can manage your investments with more options than the 5-20 funds provided in the 401k. I would recommend against rolling funds into a 401k because of the lack of options in most 401k plans. Also, 401k is pre-tax and Roth is post-tax. Pre and post tax investments don't mix before withdrawal unless you do a conversion of some kind.\"" }, { "docid": "130118", "title": "", "text": "I'm afraid you're mistaking 401k as an investment vehicle. It's not. It is a vehicle for retirement. Roth 401k/IRA has the benefit of tax free distributions at retirement, and as long as you're in the low tax bracket - it is for your benefit to take advantage of that. However, that is not the money you would be using to start a business or buy a home (except for maybe up to $10K you can withdraw without penalty for first time home buyers, but I wouldn't bother with $10k, if that's what will help you buying a house - maybe you shouldn't be buying at all). In addition, you should make sure you take advantage of the employer 401k match in full. That is free money added to your Traditional 401k retirement savings (taxed at distribution). Once you took the full advantage of the employer's match, and contributed as much as you consider necessary for your retirement above that (there are various retirement calculators on line that can help you in making that determination), everything else will probably go to taxable (regular) savings/investments." }, { "docid": "302453", "title": "", "text": "\"On #1: One way to make it less painful is to \"\"split\"\" your raises between yourself and your 401k. That is, if you get a 2% raise, increase your contribution to the 401K by 1% and keep the other 1%. Keep doing this until you are maxed out. You won't miss money you never had nearly as much as money you were used to living on. On #2: Yes, go with the Roth. Another consideration: If you are ever going to max out your 401K it is best to do it early even if you have to cut back later than to wait. Take advantage of the extra investment time while you are young.\"" }, { "docid": "179737", "title": "", "text": "Contrary to what you might have heard, moving money between mutual funds, whether or not in the same family of funds, is a taxable event, assuming, of course, that the funds are not in tax-deferred retirement accounts. About the only thing that is not taxable is moving funds between share classes in the same mutual fund, e.g. a conversion from what Vanguard refers to as Investor Shares to Admiral Shares in the same fund. In some cases, the Admiral Shares may have a considerably different price (for example, Vanguard Health Care Fund Investor Shares (VGHCX) and Admiral Shares (VGHAX) are priced at $215.83 and $91.04 respectively and so changing from one class to the other changes the number of shares owned considerably while the net value of the investment remains unchanged." }, { "docid": "482544", "title": "", "text": "You are not locked in to this percentage of new money forever, you may change it every paycheck. Pick a split that makes you feel comfortable. Then revisit how you allocate new money every year. If congress makes changes to the brackets; or your compensation changes; or the rules regarding retirement funds changes: adjust accordingly. Note that the Roth IRA came long after the IRA; and that the Roth 401K came long after the 401K. You have no idea what types of investments you will be able to contribute to with your next employer, or how your martial situation and income will change the scope of available retirement options. Heck you can even convert non-Roth to Roth in the future if that makes sense. Pick a percentage for now, but don't forget to revisit it." }, { "docid": "204479", "title": "", "text": "\"If you're making big money at 18, you should be saving every penny you can in tax-advantaged retirement accounts. (If your employer offers it, see if you can do a Roth 401(k), as odds are good you'll be in a higher tax bracket at retirement than you are now and you will benefit from the Roth structure. Otherwise, use a regular 401(k). IRAs are also an option, but you can put more money into a 401(k) than you can into an IRA.) If you do this for a decade or two while you're young, you'll be very well set on the road to retirement. Moreover, since you think \"\"I've got the money, why not?\"\" this will actually keep the money from you so you can do a better job of avoiding that question. Your next concern will be post-tax money. You're going to be splitting this between three basic sorts of places: just plain spending it, saving/investing it in bank accounts and stock markets, or purchasing some other form of capital which will save you money or provide you with some useful capability that's worth money (e.g. owning a condo/house will help you save on rent - and you don't have to pay income taxes on that savings!) 18 is generally a little young to be setting down and buying a house, though, so you should probably look at saving money for a while instead. Open an account at Vanguard or a similar institution and buy some simple index funds. (The index funds have lower turnover, which is probably better for your unsheltered accounts, and you don't need to spend a bunch of money on mutual fund expense ratios, or spend a lot of time making a second career out of stock-picking). If you save a lot of your money for retirement now, you won't have to save as much later, and will have more income to spend on a house, so it'll all work out. Whatever you do, you shouldn't blow a bunch of money on a really fancy new car. You might consider a pretty-nice slightly-used car, but the first year of car ownership is distressingly close to just throwing your money away, and fancy cars only make it that much worse. You should also try to have some fun and interesting experiences while you're still young. It's okay to spend some money on them. Don't waste money flying first-class or spend tooo much money dining out, but fun/interesting/different experiences will serve you well throughout your life. (By contrast, routine luxury may not be worth it.)\"" }, { "docid": "493366", "title": "", "text": "Here are the specific Vanguard index funds and ETF's I use to mimic Ray Dalio's all weather portfolio for my taxable investment savings. I invest into this with Vanguard personal investor and brokerage accounts. Here's a summary of the performance results from 2007 to today: 2007 is when the DBC commodity fund was created, so that's why my results are only tested back that far. I've tested the broader asset class as well and the results are similar, but I suggest doing that as well for yourself. I use portfoliovisualizer.com to backtest the results of my portfolio along with various asset classes, that's been tremendously useful. My opinionated advice would be to ignore the local investment advisor recommendations. Nobody will ever care more about your money than you, and their incentives are misaligned as Tony mentions in his book. Mutual funds were chosen over ETF's for the simplicity of auto-investment. Unfortunately I have to manually buy the ETF shares each month (DBC and GLD). I'm 29 and don't use this for retirement savings. My retirement is 100% VSMAX. I'll adjust this in 20 years or so to be more conservative. However, when I get close to age 45-50 I'm planning to shift into this allocation at a market high point. When I approach retirement, this is EXACTLY where I want to be. Let's say you had $2.7M in your retirement account on Oct 31, 2007 that was invested in 100% US Stocks. In Feb of 2009 your balance would be roughly $1.35M. If you wanted to retire in 2009 you most likely couldn't. If you had invested with this approach you're account would have dropped to $2.4M in Feb of 2009. Disclaimer: I'm not a financial planner or advisor, nor do I claim to be. I'm a software engineer and I've heavily researched this approach solely for my own benefit. I have absolutely no affiliation with any of the tools, organizations, or funds mentioned here and there's no possible way for me to profit or gain from this. I'm not recommending anyone use this, I'm merely providing an overview of how I choose to invest my own money. Take or leave it, that's up to you. The loss/gain incured from this is your responsibility, and I can't be held accountable." } ]

[ { "docid": "159709", "title": "", "text": "\"ITR1 or ITR2 needs to be filed. Declare the income through freelancing in the section \"\"income from other sources\"\"\"" } ]

[ { "docid": "84310", "title": "", "text": "After that I moved to the Middle East on March 23rd, 2015 As an NRI, one should not hold any Savings account. Please have this converted to NRO Account. Additionally it is advised that you open an NRE account. Both these can be done remotely. If I transfer money from here to a non NRE/NRO account then is it taxable? Assuming its income earned when you are NRI, it is not taxable. However if there is audit enquiry you would need to have sufficient proof to back that this income is earned during your period as NRI and hence not taxable. As indicate above, holding a savings account when you are NRI is a breach of FEMA regulation. I have been getting mail from myITreturns.com to file income tax returns. Since I am considered as NRI, do I have to fill any non return form online? If there is a source of income in India, interest on savings account etc, it is taxable and you would need to file appropriate returns. Even if you have zero income, it is safe to file a NIL return. For the year 2014 do I have to file income tax returns? For the financial year 1st April 2014 to 31st March 2015, you are still a resident Indian for tax purposes. You should have filed the return by June 2015 if there was tax due, else by March 2016. If you have not done so, please do this ASAP and regularise it." }, { "docid": "298796", "title": "", "text": "The finance team from your company should be able to advise you. From what I understand you are Indian Citizen for Tax purposes. Any income you receive globally is taxable in India. In this specific case you are still having a Employee relationship with your employer and as such the place of work does not matter. You are still liable to pay tax in India on the salary. If you are out of India for more than 182 days, you can be considered as Non-Resident from tax point of view. However this clause would not be of any benefit to you as are having a Employee / Employer relationship and being paid in India. Edit: This is only about the India portion of taxes. There maybe a UK protion of it as well, plus legally can you work and your type of Visa in UK may have a bearing on the answer" }, { "docid": "149577", "title": "", "text": "This is an 'Ordinary' bank account and not a NRO or NRI account, as I have a PAN card, Aadhar card etc and use an Indian address As you are NRI, you cannot hold an Ordinary Savings account in India. Please have this converted to NRO ASAP. It should be a simple paperwork. Will it be better and easier for my sister to transfer this inheritance money from my 'ordinary' bank account into her bank account and then have my sister 'Gift' me the money under LRS OR is it advisable to go through the lengthy procedure of opening NRO account, then filling in 15CB, 15CA, getting RBI permission and using form A2 to transfer the funds. If my sister transfers the money into her bank account, will this be considered as income for her and will she need to pay taxes on it (even though the money in my account is from inheritance). The right process would be to have your account converted to NRO, and complete the formality of 15CB, 15CA. There is no taxes if you transfer the funds to your sister and she transfers the funds back to you. From Indian Taxes point of view, this is gift between close relatives and there is no taxation." }, { "docid": "454563", "title": "", "text": "If you are tax-resident in the US, then you must report income from sources within and without the United States. Your foreign income generally must be reported to the IRS. You will generally be eligible for a credit for foreign income taxes paid, via Form 1116. The question of the stock transfer is more complicated, but revolves around the beneficial owner. If the stocks are yours but held by your brother, it is possible that you are the beneficial owner and you will have to report any income. There is no tax for bringing the money into the US. As a US tax resident, you are already subject to income tax on the gain from the sale in India. However, if the investment is held by a separate entity in India, which is not a US domestic entity or tax resident, then there is a separate analysis. Paying a dividend to you of the sale proceeds (or part of the proceeds) would be taxable. Your sale of the entity containing the investments would be taxable. There are look-through provisions if the entity is insufficiently foreign (de facto US, such as a Subpart-F CFC). There are ways to structure that transaction that are not taxable, such as making it a bona fide loan (which is enforceable and you must pay back on reasonable terms). But if you are holding property directly, not through a foreign separate entity, then the sale triggers US tax; the transfer into the US is not meaningful for your taxes, except for reporting foreign accounts. Please review Publication 519 for general information on taxation of resident aliens." }, { "docid": "71338", "title": "", "text": "I am from India. I visited US 6-8 times on business VISA and then started 2 Member LLC. Myself and My wife as LLC Members. We provide Online Training to american students from India. Also Got EIN number. Never employed any one. Do i need to pay taxes? Students from USA pays online by Paypal and i am paying taxes in India. Do i need to pay Taxes in US? DO i need to file the Tax returns? Please guide me. I formed LLC in 2010. I opened an Office-taken Virtual office for 75 USD per month to open LLC in 2010. As there is physical virtual address, am i liable for US taxes? All my earning is Online, free lancing." }, { "docid": "499407", "title": "", "text": "If you were NRI during the period you earned the income, its tax free in India and you can bring it back anytime within 7 years. There is a limit on total amount but its quite huge. If you were not an NRI during that period [when you earned in US] then whatever you have earned is taxable even in India, it does not matter whether you keep the funds in US or bring it back to India. You get the benefit of Double Tax and can deduct the tax already paid." }, { "docid": "232043", "title": "", "text": "Is it liable for taxation in India? Taxation does not depend on whether to transfer money to India or keep it in GCC. It depends on your tax status. In a given Financial year; 1st April to 31st March, if you are outside of India for more than 182 days, your are Non-Resident Indian, NRI for tax purposes. If you are NRI, income earned outside of India is not taxable in India [even if you transfer the funds to India]. If you are not an NRI, you income in GCC will be taxable in India [Even if you keep the money in GCC]. We both send our salary into a friends account in India and then transfer an amount to our own accounts This is an incorrect practise, If you are NRI, you should not be holding a Savings account, it should be converted into NRO and you can if you want open an NRE account. For your friend where you are transferring money, if there is an income tax audit, there would be quite a few questions asked and your friend has to establish and keep records that this is not GIFT, but more of a convenience agreement." }, { "docid": "130934", "title": "", "text": "Do I pay tax to the US and then also pay it in India for my income, or does my American partner, who holds 15% of the monthly income, pay tax in the US for his income? Of course you do, what kind of question is this? You have income earned in the US by a US entity, and the entity is taxed. Since LLC is a disregarded entity - the tax shifts to you personally. You should file form 1040NR. You should also talk to a tax professional who's proficient in the Indo-US tax treaty, since it may affect your situation." }, { "docid": "344290", "title": "", "text": "foreign income, transfer it to my savings account in India Yes you can transfer to India. The right account would be NRO/NRE. As an NRI one should not hold a regular savings account. forum that foreign income is not taxable unless used to buy stocks, fds etc If you are an NRI, income earned outside of India is not taxable in India. However any income you generate in India is taxable, i.e. interest income, gains from shares etc. Do we need to pay taxes for the money transferred No tax if you are an NRI even if you transfer funds to India. Taxation does not depend on whether or not you transfer the money, it depends on your status used to pay home EMIs or principle amount? You can use the money for what ever you like." }, { "docid": "131164", "title": "", "text": "As the college education is very costly, I want to send USD 25,000 to him as a gift. What is the procedure and what Indian and American tax laws are involved ? This transaction will be treated as gift. As per Indian law you can transfer unlimited amount to your close relative [son-in-law/grandchildren/daughter/etc]. In US the gift tax is on donor, as you are no US citizen you are not bound by this. As your son-in-law/grandchildren are US citizens, there is no tax to them. Your son-in-law may still need to declare this in Form 3250 or such relevant returns. Under the Liberalized remittance scheme [Refer Q3], you can transfer upto USD 250,000 per year. There maybe some forms that you need to fill. Ask your Bank. If the amount is more than USD 25,000 a CA certificate along with 15CA, 15CB need to be filled. Essentially the CA certifies that taxes on the funds being transferred have already been paid to Govt of India. Can I send money to him directly or to his father who is submitting tax returns in USA? This does not make any difference in India. Someone else may answer this question if it makes a difference in US." }, { "docid": "451180", "title": "", "text": "From India Tax point of view: Some one else may give the US tax treatment. Refer to this similar question what taxes I need to pay in India Capital Gains. My accountant never asked or reported the bought property in taxes- should he reported in taxes?Did he do wrong not reporting should I report the property in my next year taxes? If you mean in IT Returns, yes it should be declared. Can i bring the money back if needed? By Back if you mean repatriate to US, The capital portion would be Ease if the loan property was purchased or loan repaid from NRE. Else there is limit on the amount and paperwork. Consult a CA. If I rent the property instead of selling, do I have to report the income and what income? should I be filling taxes on the rental income in India or just in USA or both You are taxable for the rent and have to report it as income and pay taxes in India." }, { "docid": "35810", "title": "", "text": "Making a game is hard enough, focus on that. If/when you start getting close to having something to sell, then if you're serious and want the company to grow into a full time venture, briefly consult with a lawyer and possibly accountant to set this up. It will save you a lot of time researching what you have to do and a lot of headache from potentially doing things wrong. If you want to try to do it on your own, I'd recommend getting a book on starting a business because there is more to know than a single post can cover. You'll probably have to file for a DBA (doing business as) at your city hall in order to be allowed to refer to yourself as the name of your company (otherwise you have to use your personal name). Initiating that will likely initiate annual business taxes in your town in addition to the cheap filing fee. You also want to consider how you will handle trademark (of your business and game) and copyright (of your game). If this is going to grow, you'll have to have contracts written for either employees or for freelancers who might produce assets for you. You may also need to consider writing an EULA for your game, privacy policies, etc. Additionally, you'll likely have to file with your state to collect and send sales tax. You'll also want to meticulously track costs and revenue related to your business. Formally starting a business will likely open you up to property, sales and income tax. For example, where I am, was even taxed on the equipment the business uses (e.g. computers). This is why it makes sense to wait until you're closer to having a product before you try to formally start a business and to consult with professionals on the best way. The type of business you should form will depend on the scope you plan for the company and the amount of time/money you're willing to put in. A sole proprietorship (what you are by default) means there is no difference legally/financially between you as an individual and you as a company. This may be suitable if this is just a hobby, but not if you intend it to grow because that means any lawsuit directed at your company and its money is also directed at you and your money. The differences between an LLC and corporation are more nuanced and involve differences in legal and tax treatment, however, they both shield you from the previously mentioned problem. If you want this to be more than a hobby you should form either an LLC or a corporation. Do some research on the differences and how they might apply to you and in your state." }, { "docid": "257443", "title": "", "text": "I assume the OP is the US and that he is, like most people, a cash-basis tax payer and not an accrual basis tax payer. Suppose the value of the rental of the unit the OP is occupying was reported as income on the OP's 2010 and 2011 W-2 forms but the corresponding income tax was not withheld. If the OP correctly transcribed these income numbers onto his tax returns, correctly computed the tax on the income reported on his 2010 and 2011 1040 forms, and paid the amount due in timely fashion, then there is no tax or penalty due for 2010 and 2011. Nor is the company entitled to withhold tax on this income for 2010 and 2011 at this time; the tax on that income has already been paid by the OP directly to the IRS and the company has nothing to do with the matter anymore. Suppose the value of the rental of the unit the OP is occupying was NOT reported as income on the OP's 2010 and 2011 W-2 forms. If the OP correctly transcribed these income numbers onto his tax returns, correctly computed the tax on the income reported on his 2010 and 2011 1040 forms, and paid the amount due in timely fashion, then there is no tax or penalty due for 2010 and 2011. Should the OP have declared the value of the rental of the unit as additional income from his employer that was not reported on the W-2 form, and paid taxes on that money? Possibly, but it would be reasonable to argue that the OP did nothing wrong other than not checking his W-2 form carefully: he simply assumed the income numbers included the value of the rental and copied whatever the company-issued W-2 form said onto his 1040 form. At least as of now, there is no reason for the IRS to question his 2010 and 2011 returns because the numbers reported to the IRS on Copy A of the W-2 forms match the numbers reported by the OP on his tax returns. My guess is that the company discovered that it had not actually declared the value of the rental payments on the OP's W-2 forms for 2010 and 2011 and now wants to include this amount as income on subsequent W-2 forms. Now, reporting a lump-sum benefit of $38K (but no actual cash) would have caused a huge amount of income tax to need to be withheld, and the OP's next couple of paychecks might well have had zero take-home pay as all the money was going towards this tax withholding. Instead, the company is saying that it will report the $38K as income in 78 equal installments (weekly paychecks over 18 months?) and withhold $150 as the tax due on each installment. If it does not already do so, it will likely also include the value of the current rent as a benefit and withhold tax on that too. So the OP's take-home pay will reduce by $150 (at least) and maybe more if the current rental payments also start appearing on the paychecks and tax is withheld from them too. I will not express an opinion on the legality of the company withholding an additional $150 as tax from the OP's paycheck, but will suggest that the solution proposed by the company (have the money appear as taxable benefits over a 78-week period, have tax withheld, and declare the income on your 2012, 2013 and 2014 returns) is far more beneficial to the OP than the company declaring to the IRS that it made a mistake on the 2010 and 2011 W-2's issued to the OP, and that the actual income paid was higher. Not only will the OP have to file amended returns for 2010 and 2011 but the company will need to amend its tax returns too. In summary, the OP needs to know that He will have to pay taxes on the value of the waived rental payments for 2010 and 2011. The company's mistake in not declaring this as income to the OP for 2010 and 2011 does not absolve him of the responsibility for paying the taxes What the company is proposing is a very reasonable solution to the problem of recovering from the mistake. The alternative, as @mhoran_psprep points out, is to amend your 2010 and 2011 federal and state tax returns to declare the value of the rental during those years as additional income, and pay taxes (and possibly penalties) on the additional amount due. This takes the company completely out of the picture, but does require a lot more work and a lot more cash now rather than in the future." }, { "docid": "234510", "title": "", "text": "\"TL;DR: Get a tax adviser (EA/CPA licensed in your State) for tax issues, and a lawyer for the Operating Agreement, labor law and contract related issues. Some things are not suitable for DIY unless you know exactly what you're doing. We both do freelance work currently just through our personal names. What kind of taxes are we looking into paying into the business (besides setup of everything) compared to being a self proprietor? (I'm seeing that the general answer is no, as long as income is <200k, but not certain). Unless you decide to have your LLC taxed as a corporation, there's no change in taxes. LLC, by default, is a pass-through entity and all income will flow to your respective tax returns. From tax perspective, the LLC will be treated as a partnership. It will file form 1065 to report its income, and allocate the income to the members/partners on schedules K-1 which will be given to you. You'll use the numbers on the K-1 to transfer income allocated to you to your tax returns and pay taxes on that. Being out of state, will she incur more taxes from the money being now filtered through the business? Your employee couldn't care less about your tax problems. She will continue receiving the same salary whether you are a sole proprietor or a LLC, or Corporatoin. What kind of forms are we looking into needing/providing when switching to a LLC from freelance work? Normally we just get 1099's, what would that be now? Your contract counterparts couldn't care less about your tax problems. Unless you are a corporation, people who pay you more than $600 a year must file a 1099. Since you'll be a partnership, you'll need to provide the partnership EIN instead of your own SSN, but that's the only difference. Are LLC's required to pay taxes 4 times per year? We would definitely get an accountant for things, but being as this is side work, there will be times where we choose to not take on clients, which could cause multiple months of no income. Obviously we would save for when we need to pay taxes, but is there a magic number that says \"\"you must now pay four times per year\"\". Unless you choose to tax your LLC as a corporation, LLC will pay no taxes. You will need to make sure you have enough withholding to cover for the additional income, or pay the quarterly estimates. The magic number is $1000. If your withholding+estimates is $1000 less than what your tax liability is, you'll be penalized, unless the total withholding+estimates is more than 100% of your prior year tax liability (or 110%, depending on the amounts). The LLC would be 50% 50%, but that work would not always be that. We will be taking on smaller project through the company, so there will be times where one of us could potentially be making more money. Are we setting ourselves up for disaster if one is payed more than the other while still having equal ownership? Partnerships can be very flexible, and equity split doesn't have to be the same as income, loss or assets split. But, you'll need to have a lawyer draft your operational agreement which will define all these splits and who gets how much in what case. Make sure to cover as much as possible in that agreement in order to avoid problems later.\"" }, { "docid": "123468", "title": "", "text": "Under Income Tax Act, tax liability depends on residency as defined under section 6 of the Income Tax Act, and not on citizenship. If you are resident in India, then your global income is taxable. As it appears from your question, you are not resident of India (182 days stay in India in a FY), as such you will have absolutely no tax liability for whatever income you earn outside India." }, { "docid": "111999", "title": "", "text": "Would I have to pay income tax other then TDS on interest earned on my saving bank account. No being NRI you are not taxed in India on income outside of India. I am sending money from EU to my OWN saving account. Please note this account is not NRI\\NRO\\FCNR As an NRI you CANNOT by law hold a regular Savings Account. Please convert this account to NRO ASAP. Does the channel I use to transfer money to India would make any difference? Its 3rd party transfer service. Whether you transfer the funds or not is irrelevant. As the income was during the period when your status is NRI, there is no Tax in India. sold some shares from my Indian demat account online and got some STCG. You would need to pay tax on this in India Edit: Self Assessment Tax can be paid till 30 July 2015 for the Financial Year 1 April 2014 to 31 March 2015. Tax have to be paid in advance, so if your tax obligation is more than Rs 10,000/- there will be an interest at 1% per month and penalty at 1% per month payable" }, { "docid": "65095", "title": "", "text": "As an individual freelancer, you would need to maintain a book of accounts. This should show all the income you are getting, and should also list all the payments incurred. This can not only include the payments to other professionals, but also any hardware purchased, phone bills, any travel and entertainment bills directly related to the service you are offering. Once you arrive at a net profit figure, you would need to file this as your income. Consult a tax professional and he can help with how to keep the records of income and expenses. i.e. You would need to create invoices for payments, use checks or online transfers for most payments, segregate the accounts, one account used for this professional stuff, and another for your personal stuff, etc. In a normal course the Income Tax Department does not ask for these records, however whenever your tax returns get scrutinized on a random basis, they would ask for all the relevant documentations." }, { "docid": "54952", "title": "", "text": "A. Kindly avoid taking dollars in form of cash to india unless and until it is an emergency. Once the dollar value is in excess of $10,000, you need to declare the same with Indian customs at the destination. Even though it is not a cumbersome procedure, why unnecessarily undergo all sort of documentation and most importantly at all security checks, you will be asked questions on dollars and you need to keep answering. Finally safety issue is always there during the journey. B.There is no Tax on the amount you declare. You can bring in any amount. All you need is to declare the same. C. It is always better to do a wire transfer. D. Any transfer in excess of $14,000 from US, will atract gift tax as per IRS guidelines. You need to declare the same while filing your Income Tax in US and pay the gift tax accordingly. E. Once your fiance receives the money , any amount in excess of Rs 50,000 would be treated as individual income and he has to show the same under Income from other sources while filing the taxes. Taxes will be as per the slab he falls under. F.Only for blood relatives , this limit of 50,000 does not apply. G. Reg the Loan option, suggest do not opt for the same. Incase you want to go ahead, then pl ensure that you fully comply with IRS rules on Loans made to a foreign person from a US citizen or resident. The person lending the money must report the interest payment as income on his or her yearly tax return provided the loan has interest element. No deduction is allowed if the proceeds are used for personal or non-business purposes.In the case of no-interest loans, most people believe there is no taxable income because no interest is paid. The IRS views this seriously and the tax rules are astonishingly complex when it comes to no-interest loans. Even though no interest is paid to the lender, the IRS will treat the transaction as if the borrower paid interest at the applicable federal rate to the lender and the lender subsequently gifted the interest back to the borrower.The lender is taxed on the imaginary interest income and, depending on the amount, may also be liable for gift tax on the imaginary payment made back to the borrower. Hope the above claryfies your query. Since this involves taxation suggest you take an opinion from a Tax attorney and also ask your fiance to consult a Charted Accountant on the same. Regards" }, { "docid": "14609", "title": "", "text": "\"ITR-4 is for incorporated business. For freelancing, You can fill ITR 2 and declare the freelancing income as \"\"income from other source\"\". Refer to the Income Tax website for more details\"" } ]

[ { "docid": "347590", "title": "", "text": "Since you are living in India and earning income not from salary, you must file your tax return under ITR4(Profits or Gains of Business or Profession). You can do it online on IncomeTax India eFiling website, step by step guide available here." } ]

[ { "docid": "149577", "title": "", "text": "This is an 'Ordinary' bank account and not a NRO or NRI account, as I have a PAN card, Aadhar card etc and use an Indian address As you are NRI, you cannot hold an Ordinary Savings account in India. Please have this converted to NRO ASAP. It should be a simple paperwork. Will it be better and easier for my sister to transfer this inheritance money from my 'ordinary' bank account into her bank account and then have my sister 'Gift' me the money under LRS OR is it advisable to go through the lengthy procedure of opening NRO account, then filling in 15CB, 15CA, getting RBI permission and using form A2 to transfer the funds. If my sister transfers the money into her bank account, will this be considered as income for her and will she need to pay taxes on it (even though the money in my account is from inheritance). The right process would be to have your account converted to NRO, and complete the formality of 15CB, 15CA. There is no taxes if you transfer the funds to your sister and she transfers the funds back to you. From Indian Taxes point of view, this is gift between close relatives and there is no taxation." }, { "docid": "365847", "title": "", "text": "\"I'm not familiar with the law and taxes in India but can provide guidance based on general accounting and tax principles. You are right that receiving money as a loan is not income and isn't liable to income tax. Therefore i suggest you actually formalise this loan through a written contract with your friend. The contract should include all the usual elements of a loan: amount, interest (even if preferential or zero), principal, term, consequences of default and currency of loan. You can then simply state the purpose of transfer as \"\"Personal Loan Agreement\"\". If you have such a document and are questioned by tax authorities you can easily show that the inward remittance is from a loan and should therefore be treated like any commercial loan for tax purposes. As long as you disclose the debt in your tax return (if required in India) and your friend discloses any interest received as income i think you'll be above board and won't be liable for any income tax. To make sure, you might be better off having a quick consultation with an accountant or tax specialist in India to advise you and draft the loan agreement.\"" }, { "docid": "111131", "title": "", "text": "The key factors here are You will need to pay tax in the UK only if you live more than 183 days - that too in a tax year. Indian tax system will also classify you as a NR (Non-resident) if you live outside for more than 182 days in a tax year. In your case, your income will be in India and will stay in India. So there should not be any UK tax until you try and get that money to the UK. I will not go into outlining what if you want to go down that road since it does not apply. As for tax in India, You will need to pay tax since the source of income is Indian. Hope this helps." }, { "docid": "448981", "title": "", "text": "am I allowed to transfer into NRE account from paypal? Credits into NRE accounts are restricted. It has to be established that the funds being credited are income outside of India. In case of paypal, paypal uses local clearing to credit funds into Bank Accounts. So essentially one cannot credit NRE account by domestic clearing network like NEFT. It is best that you withdraw the funds into Bank Account outside India and use SWIFT or remittance service to credit your NRE account. I do not want to transfer to an NRO account since the money credited into it will become taxable. This is not the right assumption. Credits into NRO are not taxable by default; if you establish that the funds are from outside India, there is no tax on the income money transferred from abroad into the NRO account. However, the interest that will be paid by the bank on the balance of the NRO account is taxable income in India and is subject to TDS. In contrast, interest paid on the balance in an NRE account is not taxable in India and is not subject to TDS as long as you maintain NRI status. However it does make sense to keep accounts segregated, i.e. income generated in India, credit the NRO account and income generated outside India credit to NRE." }, { "docid": "46386", "title": "", "text": "Do I need to declare it to IRS? The account? No. You do need to file a form W8-BEN with the bank though and make sure you maintain the correct information on it (it has your address there, so if you move - update it). Your account may be frozen until the form is provided, especially if it has activity on it. The 2-nd and 3-rd scenario would come as a result of some freelancing activity done while I am out of the US (definitely would qualify for Non-Resident Alien status). This you do have to report to the IRS. I'm guessing the payer is in the US, and would not know that you're a foreigner. In this case you're liable for taxes (if the payer knows you're a foreigner - they must withhold the taxes on your behalf). The payer will report payments to the IRS, so you have to submit your own tax return for a match. If there's activity on your account that might be suspicious, it will be reported to money laundering unit in the US Treasury Department, that may come after you through the treaties the US might have with your home country (tax treaty, extradition treaty, etc)." }, { "docid": "229911", "title": "", "text": "Please find out whether you are considered to be a tax resident of the US from the date that you received the permanent immigrant visa or from the date that you first enter the US on that visa. If the former, and you received the visa after April 30, you might be a part-year resident of India for Indian Income Tax purposes for the current tax year. You need to convert your bank accounts including Fixed Deposits (the FDs that you mention) to NRO accounts as soon as possible. You will need to keep at least one NRO account open for a year or more to receive the final interest payments on your FDs as well as the proceeds of cashing in the FDs, not to mention any refunds of Indian Income Tax that may be due to you for last year or the current year. Once you are done with all these, follow the procedures outlined in this excellent answer by @Dheer to transfer the money to your US account. At this point, you can close the NRO account if you wish. As PeterK's comment says, it is not a good idea to bring a large sum of cash with you unless you are really really paranoid about banking channels. Note that if you insist on bringing cash (whether it is INR or USD) or negotiable instruments (checks or bank drafts) with you when you land in the US, these will have to be declared on entry if the total exceeds US$ 10K. There is no limit to how much you can bring with you as long as you declare it. Transfers of your own money from India to the US is not taxable income to you in the US, and income tax will already have been paid/withheld on that money in India, and so there is no income tax liability in India either on the sum transferred." }, { "docid": "318111", "title": "", "text": "This is how a consulting engagement in India works. If you are registered for Service Tax and have a service tax number, no tax is deducted at source and you have to pay 12.36% to service tax department during filing (once a quarter). If you do not have Service tax number i.e. not registered for service tax, the company is liable to deduct 10% at source and give the same to Income Tax Dept. and give you a Form-16 at the end of the financial year. If you fall in 10% tax bracket, no further tax liability, if you are in 30%, 20% more needs to be paid to Income Tax Dept.(calculate for 20% tax bracket). The tax slabs given above are fine. If you fail to pay the remainder tax (if applicable) Income Tax Dept. will send you a demand notice, politely asking you to pay at the end of the FY. I would suggest you talk to a CA, as there are implications of advance tax (on your consulting income) to be paid once a quarter." }, { "docid": "120899", "title": "", "text": "Since you have already paid tax to the Government of Uk, no tax will be levied on the money earned outside India. As per the Income tax act, any income received in India in all cases is taxable irrespective of the tax payer's residential status. A NRI after receiving income from outside India cannot be taxed as income because of remittance of such income to India." }, { "docid": "528908", "title": "", "text": "Interest earned over my saving only As you are Tax resident in UK, UK taxes Global income. So the interest earned in India is taxable. Further this is taxable when the interest was paid to you in India and it is not relevant whether you kept the funds in India or repatriated to UK. It is not clear in your question as to when the interest was credited to your Indian account. If its been for few years, you are in breach of the UK tax regulation. Consult a tax advisor how this can be corrected. If it is for this year, pay taxes as per normal tax brackets." }, { "docid": "588253", "title": "", "text": "I'm not a tax advisor, but I've done freelance work, so... If any of your side-business revenue is reported on a 1099, you're now a business owner, which is why Schedule C must be filled out. As a business owner, minimum wage doesn't apply to you. All revenue is income to you, and you owe taxes on the profit, after subtracting legitimate (verifiable) business expenses. You'll want to talk to a real tax advisor if you're going to start expensing mileage, part of your house (if you use a home office), etc. Don't forget that you'll owe self-employment tax (the employer's half of your payroll tax). You can't save money on business taxes by paying yourself a wage and then counting it as an expense to the business. You'll definitely want to talk to a tax expert if you start playing around with finances as an (the) owner of the business. Income that is not reported on a 1099 should be reported as hobby income." }, { "docid": "197501", "title": "", "text": "There is no such thing as double taxation. If you pay tax in the US, you CAN claim tax credits from India tax authority. For example, if you pay 100 tax in USA and your tax liability in India is 200, then you will only pay 100 (200 India tax liability minus 100 tax credits on foreign tax paid in the USA). This is always true and not depending on any treaty. If there is a treaty, the tax rate in the United States is set on the treaty and you CAN claim that final tax rate based upon that treaty. If you operate an LLC, and the income is NOT derived from United States and you have no ties with the US and that LLC is register to a foreign person (not company but a real human) then you will not have to submit tax return in the US... I advice you to read this: http://www.irs.gov/businesses/small/article/0,,id=98277,00.html" }, { "docid": "501686", "title": "", "text": "Are these PFIC rules new? No, PFIC rules are not new, they've been around for a very long time. what would that mean if a person owned a non-US company stock, like a company in Europe that makes chocolate? Is that considered assets that produces passive income? No. But if a person owned a non-US company stock like a company that holds a company that makes chocolate - that would be passive income. this is non-US mutual funds that hold foreign shares, like a mutual fund in India, not a US fund which owns Indian stocks? Non-US fund. For those of you who are tax advisors, is the time length (30 hours) true for filing form 8621? I would suggest not to fill this form on your own. Find a tax adviser specializing on providing services to expats, and have her do this. 30 hours for a person who has never dealt with taxes on this level before is probably not enough to learn all about PFIC, the real number is closer to 300 hours. While ZeroHedge article may be a sales pitch, PFIC rules should frighten you if they apply to your investments. Do not take them lightly, as penalties are steep and if you don't plan ahead you may end up paying way too much taxes than you could have." }, { "docid": "82284", "title": "", "text": "\"See Publication 505, specifically the section on \"\"Annualized Income Installment Method\"\", which says: If you do not receive your income evenly throughout the year (for example, your income from a repair shop you operate is much larger in the summer than it is during the rest of the year), your required estimated tax payment for one or more periods may be less than the amount figured using the regular installment method. The publication includes a worksheet and explanation of how to calculate the estimated tax due for each period when you have unequal income. If you had no freelance income during a period, you shouldn't owe any estimated tax for that period. However, the process for calculating the estimated tax using this method is a good bit more complex and confusing than using the \"\"short\"\" method (in which you just estimate how much tax you will owe for the year and divide it into four equal pieces). Therefore, in future years you might want to still use the equal-payments method if you can swing it. (It's too late for this year since you missed the April deadline for the first payment.) If you can estimate the total amount of freelance income you'll receive (even though you might not be able to estimate when you'll receive it), you can probably still use the simpler method. If you really have no idea how much money you'll make over the year, you could either use the more complex computation, or you could use a very high estimate to ensure you pay enough tax, and you'll get a refund if you pay too much.\"" }, { "docid": "558618", "title": "", "text": "What taxes will I have to pay to India? Income earned outside of India when your status is Non-Resident Indian, there is no tax applicable. You can repatriate the funds back to India within 7 years without any tax event. Someone else may put an answer about US taxes." }, { "docid": "111999", "title": "", "text": "Would I have to pay income tax other then TDS on interest earned on my saving bank account. No being NRI you are not taxed in India on income outside of India. I am sending money from EU to my OWN saving account. Please note this account is not NRI\\NRO\\FCNR As an NRI you CANNOT by law hold a regular Savings Account. Please convert this account to NRO ASAP. Does the channel I use to transfer money to India would make any difference? Its 3rd party transfer service. Whether you transfer the funds or not is irrelevant. As the income was during the period when your status is NRI, there is no Tax in India. sold some shares from my Indian demat account online and got some STCG. You would need to pay tax on this in India Edit: Self Assessment Tax can be paid till 30 July 2015 for the Financial Year 1 April 2014 to 31 March 2015. Tax have to be paid in advance, so if your tax obligation is more than Rs 10,000/- there will be an interest at 1% per month and penalty at 1% per month payable" }, { "docid": "445298", "title": "", "text": "\"AFAIK, there are two kinds of taxes your web freelancing income may be subject to in Quebec: On the income taxes: The net income you realize from your web freelancing activities would be considered taxable income. Assuming you are not operating as an incorporated business, you would need to declare the freelancing income on both your federal and provincial tax returns. You should be able to deduct certain costs related to your business – for instance, if you paid for software, hosting, domain name registration, etc. That is, only the profit from your business would be subject to income tax. With income and expenses arising from self-employment, you may want to use a professional to file your taxes. On the sales taxes: You may also need to charge federal GST and provincial QST (Quebec Sales Tax) on your services: You must enroll and charge GST and QST once you exceed the \"\"small supplier\"\" revenue threshold of $30,000 measured over four consecutive quarters. (You can still choose to enroll for GST/QST before you reach that amount, but over that amount enrollment becomes mandatory. Some businesses enroll before the threshold is reached so they can claim input tax credits for tax paid on expenses, but then there's more paperwork – one reason to perhaps avoid enrolling until necessary.) In Quebec, the Ministère du Revenu du Québec administers both GST (on behalf of the federal government) as well as provincial QST. Be sure to also check out their informative booklet, Should I Register with Revenu Quebec? (PDF). See also General Information Concerning the QST and the GST/HST (PDF).\"" }, { "docid": "535918", "title": "", "text": "\"What would be the best strategy to avoid paying income taxes on the sale after I move to another US state? Leaving the US and terminating your US residency before the sale closes. Otherwise consider checking your home country's tax treaty with the US. In any case, for proper tax planning you should employ a licensed tax adviser - an EA, CPA or an attorney licensed in your State (the one you'd be when the sale closes). No-one else is legally allowed to provide you tax advice on the matter. Because the company abroad is befriended, I have control over when (and e.g. in how many chunks) the earnings of the sale flow into my LLC. So I can plan where I live when that money hits my US account. I'm not familiar with the term \"\"befriended\"\" in this context, but form what I understand your description - its a shell corporation under your own control. This means that the transfer of money between the corporation and your LLC is of no consequence, you constructively received the money when the corporation got it, not the LLC. Your fundamental misunderstanding is that there's importance to when the money hits your US bank account. This is irrelevant. The US taxes your worldwide income, so it is taxed when you earn it, not when you transfer it into the country (as opposed to some other countries, for example India or the UK). As such, in your current scheme, it seems to me that you're breaking the US tax law. This is my personal impression, of course, get a professional advice from a licensed tax professional as I defined earlier.\"" }, { "docid": "123468", "title": "", "text": "Under Income Tax Act, tax liability depends on residency as defined under section 6 of the Income Tax Act, and not on citizenship. If you are resident in India, then your global income is taxable. As it appears from your question, you are not resident of India (182 days stay in India in a FY), as such you will have absolutely no tax liability for whatever income you earn outside India." }, { "docid": "528361", "title": "", "text": "You will be categorized as self employed. Will I have to register myself as a company or can go on unregistered and work You can register a company or can use an umbrella company or work as a sole trader. Remember as a sole trader you are legally responsible for you company's activities, an if a company sues you for your work he can take compensation from your personal assets. As a company your liability ends with the company, if your company is sued. Your personal assets are outside the purview of the lawsuit, but the court can attach that also but those are rare. This doesn't matter if you use an umbrella company. If you intend to be doing this for a short time(maybe a year or so), go for an umbrella company. Else register a company. will take you 5 minutes to form one. Depending on your earning you might need to register for VAT too. A comprehensive guide for self employed on HMRC. what would i need to be sound in uk and to be fit to work online as a freelancer? The same as above. Will it include paying any tax or paying any insurance Yes you have register for National Insurance(NI), before you can pay yourself a salary. The benefit of a company is you pay yourself a minimum salary, below the limit above which you have to contribute for NI, and take the rest as dividends. And pay no tax on it, till you don't exceed the limits. When the money comes in my account, will i be accountable to government of uk, to tell the source of income? If you are operating through a company, yes you would need to show your income(including source) and expenditure when you do your annual returns. What should i be knowing, like health insurance and things that are necessities in uk for a freelancer ? No health insurance as NHS exists. You can take out health insurance if you don't want to get into queues in NHS." } ]

[ { "docid": "467704", "title": "", "text": "They are a business. You're not a corporation. They paid you more than $600 during the year, so they're supposed to send 1099 to you and the IRS about it. They need your taxpayer certification (W9) for that. They were supposed to ask for it before they paid you, but yes - they're supposed to ask for it." } ]

[ { "docid": "372847", "title": "", "text": "For estimating your take home salary, I suggest using one of the many free salary calculators available over the Internet. I personally use PaycheckCity.com, but there are plenty of others available. To calculate your allowances for the US Federal tax, you can use the worksheet attached to the form W-4. Similar form (with a similar worksheet) is available for state taxes, on the Illinois Department of Revenue web site." }, { "docid": "222726", "title": "", "text": "\"What is the right way to handle this? Did you check the forms? Did the form state $0 tax due on the FTB LLC/Corp form (I'm guessing you operate as LLC/Corp, since you're dealing with the Franchise Tax)? The responsibility is ultimately yours. You should cross check all the numbers and verify that they're correct. That said, if the CPA filled the forms incorrectly based on your correct data - then she made a mistake and can be held liable. CPA filing forms from a jurisdiction on the other end of the country without proper research and knowledge may be held negligent if she made a grave mistake. You can file a law suit against the CPA (which will probably trigger her E&O insurance carrier who'll try to settle if there's a good chance for your lawsuit to not be thrown away outright), or complain to the State regulatory agency overseeing CPAs in the State of her license. Or both. Am I wrong for expecting the CPA should have properly filled out and filed my taxes? No, but it doesn't shift the responsibility from you. How can I find out if the CPA has missed anything else? Same as with doctors and lawyers - get a second opinion. Preferably from a CPA licensed in California. You and only you are responsible for your taxes. You may try to pin the penalties and interest on the CPA if she really made a mistake. California is notorious for very high LLC/Corp franchise tax (cost of registering to do business in the State). It's $800 a year. You should have read the forms and the instructions carefully, it is very prominent. It is also very well discussed all over the Internet, any search engine would pop it up for you with a simple \"\"California Franchise Tax for LLC/Corp\"\" search. CA FTB is also very aggressive in assessing and collecting the fee, and the rules of establishing nexus in CA are very broad. From your description it sounds like you were liable for the Franchise tax in CA, since you had a storage facility in CA. You may also be liable for sales taxes for that period.\"" }, { "docid": "91466", "title": "", "text": "\"Gifts given and received between business partners or employers/employees are treated as income, if they are beyond minimal value. If your boss gives you a gift, s/he should include it as part of your taxable wages for payroll purposes - which means that some of your wages should be withheld to cover income, social security, and Medicare taxes on it. At the end of the year, the value of the gift should be included in Box 1 (wages) of your form W-2. Assuming that's the case, you don't need to do anything special. A 1099-MISC would not be appropriate because you are an employee of your boss - so the two of you need to address the full panoply of employment taxes, not just income tax, which would be the result if the payment were reported on 1099-MISC. If the employer wants to cover the cost to you of the taxes on the gift, they'll need to \"\"gross up\"\" your pay to cover it. Let's say your employer gives you a gift worth $100, and you're in a 25% tax bracket. Your employer has to give you $125 so that you end up with a gain of $100. But the extra $25 is taxable, too, so your employer will need to add on an extra $6.25 to cover the 25% tax on the $25. But, wait, now we've gotta pay 25% tax on the $6.25, so they add an extra $1.56 to cover that tax. And now they've gotta pay an extra $.39 . . . The formula to calculate the gross-up amount is: where [TAX RATE] is the tax rate expressed as a percentage. So, to get the grossed-up amount for a $100 gift in a 25% bracket, we'd calculate 1/(1-.25), or 1/.75, or 1.333, multiply that by the target gift amount of $100, and end up with $133.33. The equation is a little uglier if you have to pay state income taxes that are deductible on the federal return but it's a similar principle. The entire $133.33 would then be reported as income, but the net effect on the employee is that they're $100 richer after taxes. The \"\"gross-up\"\" idea can be quite complicated if you dig into the details - there are some circumstances where an additional few dollars of income can have an unexpected impact on a tax return, in a fashion not obvious from looking at the tax table. If the employer doesn't include the gift in Box 1 on the W-2 but you want to pay taxes on it anyway, include the amount in Line 7 on the 1040 as if it had been on a W-2, and fill out form 8919 to calculate the FICA taxes that should have been withheld.\"" }, { "docid": "32072", "title": "", "text": "I don't think anyone can give you a definitive answer without knowing all about your situation, but some things to consider: If you are on a 1099, you have to pay self-employment tax, while on a W-2 you do not. That is, social security tax is 12.4% of your income. If you're a 1099, you pay the full 12.4%. If you're W-2, you pay 6.2% and the employer pays 6.2%. So if they offer you the same nominal rate of pay, you're 6.2% better off with the W-2. What sort of insurance could you get privately and what would it cost you? I have no idea what the going rates for insurance are in California. If you're all in generally good health, you might want to consider a high-deductible policy. Then if no one gets seriously sick you've saved a bunch of money on premiums. If someone does get sick you might still pay less paying the deductible than you would have paid on higher premiums. I won't go into further details as that's getting off into another question. Even if the benefits are poor, if there are any benefits at all it can be better than nothing. The only advantage I see to going with a 1099 is that if you are legally an independent contractor, then all your business expenses are deductible, while if you are an employee, there are sharp limits on deducting employee business expenses. Maybe others can think of other advantages. If there is some reason to go the 1099 route, I understand that setting up an LLC is not that hard. I've never done it, but I briefly looked into it once and it appeared to basically be a matter of filling out a form and paying a modest fee." }, { "docid": "254151", "title": "", "text": "\"If you receive a 1099-MISC from YouTube, that tells you what they stated to the IRS and leads into most tax preparation software guided interviews or wizards as a topic for you to enter. Whether or not you have a 1099-MISC, this discussion from the IRS is pertinent to your question. You could probably elect to report the income as a royalty on your copyrighted work of art on Schedule E, but see this note: \"\"In most cases you report royalties in Part I of Schedule E (Form 1040). However, if you ... are in business as a self-employed writer, inventor, artist, etc., report your income and expenses on Schedule C or Schedule C-EZ (Form 1040).\"\" Whether reporting on Schedule E or C is more correct or better for your specific circumstances is beyond the advice you should take from strangers on the internet based on a general question - however, know that there are potentially several paths for you. Note that this is revenue from a business, so if you paid for equipment or services that are 100% dedicated to your YouTubing (PC, webcam, upgraded broadband, video editing software, vehicle miles to a shoot, props, etc.) then these are a combination of depreciable capital investments and expenses you can report against the income, reducing the taxes you may owe. If the equipment/services are used for business and personal use, there are further guidelines from the IRS as to estimating the split. These apply whether you report on Sch. E, Sch. C, or Sch C-EZ. Quote: \"\"Self-Employment Income It is a common misconception that if a taxpayer does not receive a Form 1099-MISC or if the income is under $600 per payer, the income is not taxable. There is no minimum amount that a taxpayer may exclude from gross income. All income earned through the taxpayer’s business, as an independent contractor or from informal side jobs is self-employment income, which is fully taxable and must be reported on Form 1040. Use Form 1040, Schedule C, Profit or Loss from Business, or Form 1040, Schedule C-EZ, Net Profit from Business (Sole Proprietorship) to report income and expenses. Taxpayers will also need to prepare Form 1040 Schedule SE for self-employment taxes if the net profit exceeds $400 for a year. Do not report this income on Form 1040 Line 21 as Other Income. Independent contractors must report all income as taxable, even if it is less than $600. Even if the client does not issue a Form 1099-MISC, the income, whatever the amount, is still reportable by the taxpayer. Fees received for babysitting, housecleaning and lawn cutting are all examples of taxable income, even if each client paid less than $600 for the year. Someone who repairs computers in his or her spare time needs to report all monies earned as self-employment income even if no one person paid more than $600 for repairs.\"\"\"" }, { "docid": "307779", "title": "", "text": "It looks like fair-market value when you receive your virtual currency is counted as income. And you're also subject to self-employment tax on that income. Here's an FAQ from the IRS: Q-8: Does a taxpayer who “mines” virtual currency (for example, uses computer resources to validate Bitcoin transactions and maintain the public Bitcoin transaction ledger) realize gross income upon receipt of the virtual currency resulting from those activities? A-8: Yes, when a taxpayer successfully “mines” virtual currency, the fair market value of the virtual currency as of the date of receipt is includible in gross income. See Publication 525, Taxable and Nontaxable Income, for more information on taxable income.Q-9: Is an individual who “mines” virtual currency as a trade or business subject to self-employment tax on the income derived from those activities? A-9: If a taxpayer’s “mining” of virtual currency constitutes a trade or business, and the “mining” activity is not undertaken by the taxpayer as an employee, the net earnings from self-employment (generally, gross income derived from carrying on a trade or business less allowable deductions) resulting from those activities constitute selfemployment income and are subject to the self-employment tax. See Chapter 10 of Publication 334, Tax Guide for Small Business, for more information on selfemployment tax and Publication 535, Business Expenses, for more information on determining whether expenses are from a business activity carried on to make a profit. You'd of course be able to offset that income with the expense of mining the virtual currency, depreciation of dedicated mining equipment, electricity, not sure what else. Edit: Here's a good resource on filing taxes with Bitcoin: Filling in the 1040 Income from Bitcoins and all crypto-currencies is declared as either capital gains income or ordinary income, for example from mining. Income Ordinary income will be declared on either your 1040 (line 21 - Other Income) for an individual, or within your Schedule C, if you are self-employed or have sole-proprietor business. Capital Gains Capital gains income, or losses, are declared on Schedule D. Since there are no reported 1099 forms from Bitcoin exchanges, you will need to include your totals with Box C checked for short-term gains, and with Box F checked for long-term gains. Interesting notes from that article, your first example could actually be trickier than expected if you started mining before there was a Monero to USD exchange. Also, there can also be capital gains implications from using your virtual currency to buy goods, which sounds like a pain to keep track of." }, { "docid": "414284", "title": "", "text": "\"In general, following the W-4 instructions should result in withholdings that are fairly close to the amount of taxes that you will owe for the year, particularly if your situation is relatively uncomplicated. Claiming less withholdings than the form suggests can help ensure that you end up saving money in your \"\"interest-free IRS savings account\"\" and get a refund at the end of the year, which some people prefer so they don't need to budget separately for a tax payment. I'm guessing that the HR employee either prefers doing so himself or has on occasion received complaints from other employees that they \"\"didn't take enough out\"\". Personally, I'd prefer to claim as many withholdings as I can, and be sure to have some money aside in case it turns out that I have to owe a little bit, since it means I get more take-home pay throughout the year. It's good to keep in mind that a W-4 isn't written in stone. If it turns out that too much or too little is being taken out, you can always change it. You can also try playing around with the IRS withholding calculator to try some scenarios.\"" }, { "docid": "131451", "title": "", "text": "\"For example, for my employer I received a signing bonus, and a \"\"relocation lump sum\"\" separate from that signing bonus. The relocation lump sum is taxed and will appear as income on my W-2, and I can spend it on anything I want. That said, should the relocation lump sum count towards the entry quoted above in Form 3903, or would it be considered the same as any other bonus; thus allowing me to take a full deduction for all of my deductible travel expenses? The signing bonus and relocation lump sum will appear as regular income on your W-2. You can think of the relocation bonus as something to cover the pain and suffering the cost of moving, without needing to send in receipts. Lets assume that you meet the distance and time tests, so there is potential to save money on your taxes. Lets also put your actual moving expenses as $2500. If you have valid moving expenses the IRS will allow you to use them to reduce your AGI. So now you can reduce your AGI by the $2500. Enter the total amount your employer paid you for the expenses listed on lines 1 and 2 that is not included in box 1 of your Form W-2 (wages). This amount should be shown in box 12 of your Form W-2 with code P. My question is: what exact payments from your employer should be entered here? I realize that you can just write the number you get in box 12 with code P on your W-2, but I'm curious how they come up with this number. In some cases the company will reimburse you your moving expenses up to a maximum of $x. For example a maximum of $1000 That means you submit receipts for those expenses and they give you a check or add it to your next paycheck. The check will either be for the amount on your receipts or the maximum amount, whichever is smaller. In this situation with actual expenses of $2500 and a reimbursement of $1000 you can reduce your AGI by $1500.\"" }, { "docid": "445739", "title": "", "text": "\"How/when does my employer find out? Do they get a report from their bank stating that \"\"check 1234 for $1212.12 paid to John Doe was never deposited\"\" or does it manifest itself as an eventual accounting discrepancy that somebody has to work to hunt down? The accounting department or the payroll company they use will report that the check was not deposited. The bank has no idea that a check was written, but the accounting deportment will know. The bank reports on all the checks that were cashed. Accounting cares because the un-cashed check for $1212.12 is a liability. They have to keep enough money in the bank to pay all the liabilities. It shouldn't be hard for them to track down the discrepancy, they will know what checks are outstanding. Can my employer punish me for refusing the money in this way? Do they have any means to force me to take what I am \"\"owed?\"\" They can't punish you. But at some time in the future they will will tell their bank not to honor the check. They will assume that it was lost or misplaced, and they will issue a new one to you. When tax time comes, and I still have not accepted the money, would it be appropriate to adjust my reported income down by the refused amount? You can't decide not to report it. The company knows that in year X they gave you a check for the money. They are required to report it, since they also withheld money for Federal taxes, state taxes, payroll taxes, 401K, insurance. They also count your pay as a business expense. If you try and adjust the numbers on the W-2 the IRS will note the discrepancy and want more information. Remember the IRS get a copy of every W-2. The employer has to report it because some people who aren't organized may not have cashed a December check before the company has to generate the W-2 in late January. It would confuse everything if they could skip reporting income just because a check wasn't cashed by the time they had to generate the W-2.\"" }, { "docid": "90290", "title": "", "text": "I think you're making a mistake. If you still want to make this mistake (I'll explain later why I think its a mistake), the resources for you are: IRS.GOV - The IRS official web site, that has all the up-to-date forms and instructions for them, guiding publications and the relevant rules. You might get a bit overwhelmed through. Software programs - TurboTax (Home & Business for a sole propriator or single member LLC, Business for more complicated business), or H&R Block Business (only one version that should cover all) are for your guidance. They provide tips and interactive guidance in filling in all the raw data, and produce all the forms filled for you according to the raw data you entered. I personally prefer TurboTax, I think its interface is nicer and the workflow is more intuitive, but that's my personal preference. I wrote about it in my blog last year. Both also include plug-ins for the state taxes (If I remember correctly, for both the first state is included in the price, if you need more than 1 state - there's extra $30-$40 per state). Your state tax authority web site (Minnesota Department of Revenue in your case). Both Intuit and H&R Block have on-line forums where people answer each others questions while using the software to prepare the taxes, you might find useful information there. As always, Google is your friend. Now, why I think this is a mistake. Mistakes that you make - will be your responsibility. If you use the software - they'll cover the calculation mistakes. But if you write income in a wrong specification or take a wrong deduction that you shouldn't have taken - it will be on your head and you're the one to pay the fines and penalties for that. Missed deductions and credits - CPA's (should) know about all the latest deductions and credits that you or your business might be entitled to. They also (should) know which one got canceled and you shouldn't be continuing taking them if you had before. Expenses - there are plenty of rules of what can be written off as an expense and how. Some things should be written off this year, others over several years, for some depreciation formula should be used, etc etc. Tax programs might help you with that, but again - mistakes are your responsibility. Especially for the first time and for the newly formed business, I think you should use a (good!) CPA. The CPA should take responsibility over your filing. The CPA should provide guarantee that based on the documents you provided, he filled all the necessary forms correctly, and will absorb all the fees and penalties if there's an audit and mistakes were found not because you withheld information from your CPA, but because the CPA made a mistake. That costs money, and that's why the CPA's are more expensive than using a program or preparing yourself. But, the risk is much higher, especially for a new business. And after all - its a business expense." }, { "docid": "509650", "title": "", "text": "\"While I agree with Ben a lot I feel like his answer is really poor here. You do not call a number to give your credit card information out for a refund. That is ridiculous. Just from his answer - he has had 5 cases of fraud lately - you should know that you shouldn't follow this advice. I personally don't ever give my credit card number over the phone, unless it is the very very very last resort. It is not just about money and safety but it is about time. Every time that you give your number out over the phone there is a chance that the employee on the other end (by either scam or legitimate business) will use or sell your info. So you need to determine if the time saved by doing a transaction over the phone is worth hours/days of your time if your card has a fraud issue. And note that fraud sometimes is easily negated, but if done smartly can be hard to prove via a quick call or email to card company. What should you do? Tell company that you will simply get the refund through your credit card company. And if we go back to time element... You fill out form on card website. Card company goes back to vendor and says - \"\"Why are you asking for card numbers via email?\"\" Card company either cancels vendor contract or more likely helps them understand the technology available so they don't have to do this. Therefore that quick form that you filled out will now keep this company from bugging you again. By going through their archaic \"\"systems\"\" you are enabling their behavior.\"" }, { "docid": "232544", "title": "", "text": "\"I agree that you should have received both a 1099 and a W2 from your employer. They may be reluctant to do that because some people believe that could trigger an IRS audit. The reason is that independent contractor vs employee is supposed to be defined by your job function, not by your choice. If you were a contractor and then switched to be an employee without changing your job description, then the IRS could claim that you should have always been an employee the entire time, and so should every one of the other contractors that work for that company with a similar job function. It's a hornet's nest that the employer may not want to poke. But that's not your problem; what should you do about it? When you say \"\"he added my Federal and FICA W/H together\"\", do you mean that total appears in box 4 of your 1099? If so, it sounds like the employer is expecting you to re-pay the employer portion of FICA. Can you ask them if they actually paid it? If they did, then I don't see them having a choice but to issue a W2, since the IRS would be expecting one. If they didn't pay your FICA, then the amount this will cost you is 7.65% of what would have been your W2 wages. IMHO it would be reasonable for you to request that they send you a check for that extra amount. Note: even though that amount will be less than $600 and you won't receive a 1099 in 2017 for it, legally you'll still have to pay tax on that amount so I think a good estimate would be to call it 10% instead. Depending on your personality and your relationship with the employer, if they choose not to \"\"make you whole\"\", you could threaten to fill out form SS-8. Additional Info: (Thank you Bobson for bringing this up.) The situation you find yourself in is similar to the concept of \"\"Contract-to-Hire\"\". You start off as a contractor, and later convert to an employee. In order to avoid issuing a 1099 and W2 to the same person in a single tax year, companies typically utilize one of the following strategies: Your particular situation is closest to situation 2, but the reverse. Instead of retroactively calling you a W2 employee the entire time, your employer is cheating and attempting to classify you as a 1099 contractor the entire time. This is frowned upon by the IRS, as well as the employee since as you discovered it costs you more money in the form of employer FICA. From your description it sounds like your employer was trying to do you a favor and didn't quite follow through with it. What they should have done was never switch you to W2 in the first place (if you really should have been a contractor), or they should have done the conversion properly without stringing you along.\"" }, { "docid": "298551", "title": "", "text": "\"Assuming that no one else has hit the ask, and the asks are still there, yes, you will fill $54.55 as long as you didn't exhaust that ask. Actually, there is no \"\"current price at which the stock is exchanging hands\"\"; in reality, it is \"\"the last price traded\"\". The somebody who negotiated prices between buyers & sellers is the exchange through their handling of bids & asks. The real negotiation comes between bids & asks, and if they meet or cross, a trade occurs. It's not that both bid & ask should be $54.55, it's that they were. To answer the title, the reasons why the bid and ask (even their midpoint) move away from the last price are largely unknown, but at least for the market makers, if their sell inventory is going away (people are buying heavily and they're running out of inventory) they will start to hike up their asks a lot and their bids a little because market makers try to stay market neutral, having no opinion on whether an asset will rise or fall, so with stocks, that means having a balanced inventory of longs & shorts. They want to (sometimes have to depending on the exchange) accommodate the buying pressure, but they don't want to lose money, so they simply raise the ask and then raise the bid as people hit their asks since their average cost basis has risen. In fact (yahoo finance is great about showing this), there's rarely 1 bid and 1 ask. Take a look at BAC's limit book: http://finance.yahoo.com/q/ecn?s=BAC+Order+Book You can see that there are many bids and many asks. If one ask is exhausted, the next in line is now the highest. The market maker who just sold at X will certainly step over the highest bid to bid at X*0.9 to get an 11% return on investment.\"" }, { "docid": "573077", "title": "", "text": "\"Being \"\"Long\"\" something means you own it. Being \"\"Short\"\" something means you have created an obligation that you have sold to someone else. If I am long 100 shares of MSFT, that means that I possess 100 shares of MSFT. If I am short 100 shares of MSFT, that means that my broker let me borrow 100 shares of MSFT, and I chose to sell them. While I am short 100 shares of MSFT, I owe 100 shares of MSFT to my broker whenever he demands them back. Until he demands them back, I owe interest on the value of those 100 shares. You short a stock when you feel it is about to drop in price. The idea there is that if MSFT is at $50 and I short it, I borrow 100 shares from my broker and sell for $5000. If MSFT falls to $48 the next day, I buy back the 100 shares and give them back to my broker. I pocket the difference ($50 - $48 = $2/share x 100 shares = $200), minus interest owed. Call and Put options. People manage the risk of owning a stock or speculate on the future move of a stock by buying and selling calls and puts. Call and Put options have 3 important components. The stock symbol they are actionable against (MSFT in this case), the \"\"strike price\"\" - $52 in this case, and an expiration, June. If you buy a MSFT June $52 Call, you are buying the right to purchase MSFT stock before June options expiration (3rd Saturday of the month). They are priced per share (let's say this one cost $0.10/share), and sold in 100 share blocks called a \"\"contract\"\". If you buy 1 MSFT June $52 call in this scenario, it would cost you 100 shares x $0.10/share = $10. If you own this call and the stock spikes to $56 before June, you may exercise your right to purchase this stock (for $52), then immediately sell the stock (at the current price of $56) for a profit of $4 / share ($400 in this case), minus commissions. This is an overly simplified view of this transaction, as this rarely happens, but I have explained it so you understand the value of the option. Typically the exercise of the option is not used, but the option is sold to another party for an equivalent value. You can also sell a Call. Let's say you own 100 shares of MSFT and you would like to make an extra $0.10 a share because you DON'T think the stock price will be up to $52/share by the end of June. So you go to your online brokerage and sell one contract, and receive the $0.10 premium per share, being $10. If the end of June comes and nobody exercises the option you sold, you get to keep the $10 as pure profit (minus commission)! If they do exercise their option, your broker makes you sell your 100 shares of MSFT to that party for the $52 price. If the stock shot up to $56, you don't get to gain from that price move, as you have already committed to selling it to somebody at the $52 price. Again, this exercise scenario is overly simplified, but you should understand the process. A Put is the opposite of a Call. If you own 100 shares of MSFT, and you fear a fall in price, you may buy a PUT with a strike price at your threshold of pain. You might buy a $48 June MSFT Put because you fear the stock falling before June. If the stock does fall below the $48, you are guaranteed that somebody will buy yours at $48, limiting your loss. You will have paid a premium for this right (maybe $0.52/share for example). If the stock never gets down to $48 at the end of June, your option to sell is then worthless, as who would sell their stock at $48 when the market will pay you more? Owning a Put can be treated like owning insurance on the stock from a loss in stock price. Alternatively, if you think there is no way possible it will get down to $48 before the end of June, you may SELL a $48 MSFT June Put. HOWEVER, if the stock does dip down below $48, somebody will exercise their option and force you to buy their stock for $48. Imagine a scenario that MSFT drops to $30 on some drastically terrible news. While everybody else may buy the stock at $30, you are obligated to buy shares for $48. Not good! When you sold the option, somebody paid you a premium for buying that right from you. Often times you will always keep this premium. Sometimes though, you will have to buy a stock at a steep price compared to market. Now options strategies are combinations of buying and selling calls and puts on the same stock. Example -- I could buy a $52 MSFT June Call, and sell a $55 MSFT June Call. I would pay money for the $52 Call that I am long, and receive money for the $55 Call that I am short. The money I receive from the short $55 Call helps offset the cost of buying the $52 Call. If the stock were to go up, I would enjoy the profit within in $52-$55 range, essentially, maxing out my profit at $3/share - what the long/short call spread cost me. There are dozens of strategies of mixing and matching long and short calls and puts depending on what you expect the stock to do, and what you want to profit or protect yourself from. A derivative is any financial device that is derived from some other factor. Options are one of the most simple types of derivatives. The value of the option is derived from the real stock price. Bingo? That's a derivative. Lotto? That is also a derivative. Power companies buy weather derivatives to hedge their energy requirements. There are people selling derivatives based on the number of sunny days in Omaha. Remember those calls and puts on stock prices? There are people that sell calls and puts based on the number of sunny days in Omaha. Sounds kind of ridiculous -- but now imagine that you are a solar power company that gets \"\"free\"\" electricity from the sun and they sell that to their customers. On cloudy days, the solar power company is still on the hook to provide energy to their customers, but they must buy it from a more expensive source. If they own the \"\"Sunny Days in Omaha\"\" derivative, they can make money for every cloudy day over the annual average, thus, hedging their obligation for providing more expensive electricity on cloudy days. For that derivative to work, somebody in the derivative market puts a price on what he believes the odds are of too many cloudy days happening, and somebody who wants to protect his interests from an over abundance of cloudy days purchases this derivative. The energy company buying this derivative has a known cost for the cost of the derivative and works this into their business model. Knowing that they will be compensated for any excessive cloudy days allows them to stabilize their pricing and reduce their risk. The person selling the derivative profits if the number of sunny days is higher than average. The people selling these types of derivatives study the weather in order to make their offers appropriately. This particular example is a fictitious one (I don't believe there is a derivative called \"\"Sunny days in Omaha\"\"), but the concept is real, and the derivatives are based on anything from sunny days, to BLS unemployment statistics, to the apartment vacancy rate of NYC, to the cost of a gallon of milk in Maine. For every situation, somebody is looking to protect themselves from something, and somebody else believes they can profit from it. Now these examples are highly simplified, many derivatives are highly technical, comprised of multiple indicators as a part of its risk profile, and extremely difficult to explain. These things might sound ridiculous, but if you ran a lemonade stand in Omaha, that sunny days derivative just might be your best friend...\"" }, { "docid": "335636", "title": "", "text": "You have interpreted the instructions correctly. The issue with two jobs at the same time, is that that second job will be taxed at the highest rate; but the second employer has no idea what the other position is paying you. If you make enough to be in the 15% tax bracket for your main job that means: some of the money from each paycheck is taxed zero; some is taxed at 10% and the last dollars are taxed at 15%. But the second job should withhold for taxes to cover all the income at 15%. To avoid problems you should look at the tax form you are filling out this year. Look at the total tax you paid. Not the refund or the amount you owed when you filed but your total tax paid. The government allows a safe harbor if you make sure that in 2016 you have the same amount withheld this calendar year. If that isn't enough, you will owe money in April 2017, but you will not have to pay a penalty. After you have a couple of paycheck from your main employer, check to see that if you work the rest of the year at that same rate that the federal withholding will make the safe harbor. If you will make it, you don't have to worry about the penalty. If you will fall short, adjust the w-4 accordingly." }, { "docid": "46092", "title": "", "text": "I see no reason why a US ID would be mandatory anywhere in the UK. I'm sure they have their own tax IDs in the UK. However, if the gallery requires US persons to submit US W-9 - then yes, you're covered under that requirement." }, { "docid": "595090", "title": "", "text": "If you have complicated taxes (own a business, many houses, you are self employed, you are a contractor, etc etc) a person can make the most of your situation. If you are a w-2 single job, maybe with a family, the programs are going to be so close to spot on that the extra fees aren't worth it. I would never bother using HR Block or Liberty or those tax places that pop up. Use the software, or in my state sometimes municipalities put on tax help days at the library to assist in filling out the forms. If you have tough taxes, get a dedicated professional based on at least a few recommendations." }, { "docid": "16895", "title": "", "text": "\"The translation scheme is detailed in IRS Publication 15, \"\"Employer's Tax Guide\"\". For the 2010 version, the information is in Section 16 on Page 37. There are two ways that employers can calculate the withheld tax amount: wage bracket and percentage. Alternatively, they can also use one of the methods defined in IRS Publication 15-A. I'll assume the person making $60k/yr with 10 allowances is paid monthly ($5000/period) and married. Using the wage bracket method, the amount withheld for federal taxes would be $83 per pay period. Using the percentage method, it would be $81.23 per pay period. I don't recommend that you use this information to determine how to fill out your W-4. The IRS provides a special online calculator for that purpose, which I have always found quite accurate. Note: \"\"allowances\"\" are not the same as \"\"dependents\"\"; \"\"allowances\"\" are a more realistic estimation of your tax deductions, taking into consideration much more than just your dependents.\"" }, { "docid": "144129", "title": "", "text": "The company that's apparently going to pay this rent wants to treat it as a business expense. They are asking for your SSN because they expect to issue a 1099-MISC. (They probably gave you a Form W-9? It's not mandatory but it's common to request a taxpayer ID on this form.) There are a couple of issues at play here:" } ]

[ { "docid": "592926", "title": "", "text": "You will have to pay your taxes in the UK not USA. For tax purposes it is the company's tax residency not where the server is located. You are just hiring a server in USA. Take for example a CDN being used for your same service then would you pay taxes in 300 different countries if you use Akamai? Does not work that way." } ]

[ { "docid": "260075", "title": "", "text": "Take some of the commentary on home buying forums with a grain of salt. I too have read some of the commentary on these forums such as myFICO, Trulia, or Zillow and rarely is the right advice given or proper followup done. Typical 401k withdrawals for home purchase would not be considered a hardship. However, most employer 401k plans will allow you to take a loan for 401k as long as you provide suitable documentation: HUD-1 statement, Real Estate Contract, Good Faith Estimate, or some other form of suitable documentation as described by the plan administrator. For instance, I just took a 401k loan to pay for closing costs and I had to provide only the real estate contract. Could I not follow through with the contract? Sure, but what if I am found out for fraud? Then the plan administrator would probably end up turning the distribution into a taxable distribution. I wouldn't go to jail in this hypothetical situation - I am only stealing from myself. But the law states that certain loan situations are not liable for tax as long as that situation still exists. In the home loan situation, my employer allows for a low interest, 10 year loan. My employer also allows for a pre-approved loan for any purpose. This would be a low interest, 5 year loan. There is also the option to not do a loan at all. But normally that is only allowed after you have exhausted all your loan options and the government makes it intentionally harsh (30% penalty at least) to discourage people from dumping their tax free haven 401k accounts. That all being said, many plans offer no prepayment penalty. So like my employer has for us, I can pay it all back in full whenever I want or make micropayments every month. Otherwise, it comes out of my pay stub biweekly. So if it were to fall through, I could just put it all back like it never happened. Though with my plan, there is a cooling off period of 7 days before I can take another loan. Keep in mind that if you leave your employer then the full amount becomes a taxable distribution unless you pay it back within a certain period of time after leaving the employer. Whether this fits your financial situation is up to you, but a loan is definitely preferred over a partial or full withdrawal since you are paying yourself back for your rightly earned retirement which is just as important." }, { "docid": "377741", "title": "", "text": "\"Incremental profit, not revenue. If the incremental profit I project from an additional hire is greater than the cost. Taxes drive the cost up and the profit down, depending on the tax. Saying \"\"I will hire no matter what taxes are levied against me\"\" is just as ridiculous as saying \"\"I will not hire if one cent is levied against me\"\". At the end of the day, profits are the source of future expansion and investment (we are not publicly traded). Taxes effectively reduce the amount we have left to invest. They do not reduce this amount to zero, but they do reduce it. You are right to imply that I want the business to grow constantly, but that requires investment of actual money before the top or bottom line impact happens, months or years in advance. Sometimes, you take a risk that doesn't pan out, and that money is gone forever. Sometimes it develops into a profitable segment of the business. In wither case, taxes reduce the chunk of change we can use for this kind of activity. I sense latent hostility in your phrasing, but I hope I am wrong. It feels like you are accusing me of making a profit, but I openly admit to making a profit. I do not view this as something bad. It is profitability that allows me to increase salary and benefit levels for employees, try to continually improve working conditions, invest in new equipment, spend on r&amp;amp;d to make better products, and of course increase my personal income. I try to align the way in which i make money personally with constantly making customers and employees happier. Happy customers means more revenue and happy employees means better processes, better ideas, and more profit. I don't view this as bad, and I hope I read emotion into your comment that you did not mean. If so, I apologize in advance, but if you did mean to be hostile, I hope you at least understand where I am coming from now. Edit: grammar\"" }, { "docid": "104134", "title": "", "text": "\"You can move money from a 403b to a 401k plan, but the question you should ask yourself is whether it is a wise decision. Unless there are specific reasons for wanting to invest in your new employer's 401k (e.g. you can buy your employer's stock at discounted rates within the 401k, and this is a good investment according to your friends, neighbors, and brothers-in-law), you would be much better off moving the 403b money into an IRA, where you have many more choices for investment and usually can manage to find investments with lower investment costs (e.g. mutual fund fees) than in a typical employer's 401k plan. On the other hand, 401k assets are better protected than IRA assets in case you are sued and a court finds you to be liable for damages; the plaintiff cannot come after the 401k assets if you cannot pay. To answer the question of \"\"how?\"\", you need to talk to the HR people at your current employer to make sure that they are willing to accept a roll-over from another tax-deferred plan (not all plans are agreeable to do this) and get any paperwork from them, especially making sure that you find out where the check is to be sent, and to whom it should be payable. Then, talk to your previous employer's HR people and tell them that you want to roll over your 403b money into the 401k plan of your new employer, fill out the paperwork, make sure they know to whom to cut the check to, and where it is to be sent etc. In my personal experience, I was sent the check payable to the custodian of my new (IRA) account, and I had to send it on to the custodian; my 403b people refused to send the check directly to the new custodian. The following January, you will receive a 1099-R form from your 403b plan showing the amount transferred to the new custodian, with hopefully the correct code letter indicating that the money was rolled over into another tax-deferred account.\"" }, { "docid": "527090", "title": "", "text": "\"When one says that \"\"corporations are people\"\", in a legal sense, they are saying that they have the ability to enter into binding legal agreements in a manner similar to people. This allows corporations to do things like own a building or a car, or enter into a contract. This is so that an individual does not have to do so. This keeps individuals from being liable for the activities of the corporation (it also keeps the individual from running off the the corporation's car or selling the corporation's building). If they are using it in any sense other than the legal sense, it's either hyperbole, ignorance, or pandering. Now, if you set yourself up as LettersFromTheSky, Inc, then you would very well be able to get all the same tax deductions and benefits as a corporation. But you would also be liable for everything that a corporation is liable for (namely, a higher standard of reporting and different accounting methods).\"" }, { "docid": "97010", "title": "", "text": "\"I have heard that I can give 10k as a gift in cash for my aunt to take on the plane. Please don't, for her own safety. Don't know when was the last you've been to Russia, but that's not a place to walk around with $10K in cash in your pocket. For the rest, the 20k, I am not sure what is the best course of action. Would something like Western Union, Paypal or Bank Wire Transfer be the best course of action? Wire transfer would be the safest option. Would there be tax implications for me as well? Depends on where you are tax resident and where you are a citizen. Some countries have \"\"gift tax\"\", but most don't. If you're a US tax resident, then you're subject to US gift tax rules. Your gifts are taxable if they exceed $14K per year per person. So your $30K to your mom is taxable. But your $10K to your mom, $10K to your dad and $10K to your aunt is not. You cannot however control what they do with it.\"" }, { "docid": "318111", "title": "", "text": "This is how a consulting engagement in India works. If you are registered for Service Tax and have a service tax number, no tax is deducted at source and you have to pay 12.36% to service tax department during filing (once a quarter). If you do not have Service tax number i.e. not registered for service tax, the company is liable to deduct 10% at source and give the same to Income Tax Dept. and give you a Form-16 at the end of the financial year. If you fall in 10% tax bracket, no further tax liability, if you are in 30%, 20% more needs to be paid to Income Tax Dept.(calculate for 20% tax bracket). The tax slabs given above are fine. If you fail to pay the remainder tax (if applicable) Income Tax Dept. will send you a demand notice, politely asking you to pay at the end of the FY. I would suggest you talk to a CA, as there are implications of advance tax (on your consulting income) to be paid once a quarter." }, { "docid": "265866", "title": "", "text": "I did the reverse several years ago, moving from NH to MA. You will need to file Form 1-NR/PY for 2017, reporting MA income as a part-year residence. I assume you will need to report the April capital gain on your MA tax return, as you incurred the gain while a MA resident. (I am not a lawyer or tax professional, so I don't want to state anything about this as a fact, but I would be very surprised if moving after you incurred the gain would have any affect on where you report it.)" }, { "docid": "455239", "title": "", "text": "&gt; I think all taxes are theft, no matter who they come from. That is a matter of opinion. Obviously, I disagree with that sentiment. Do you have a reason behind it? &gt; Again, you haven't really substantiated any claim about your financial situation. I have scanned in a tax summary sheet from my CPA. I took off all the personal identifying data. I would be happy to share it with you, but I am not sure how to attach it to posts like this. Any ideas? &gt; Additionally, I'm sure someone of your financial stature would have enough time to go on Reddit. I am an owner, if I want to sit at my work desk and reddit - as I am doing right now - I can do that. Not what I typically do, but I just got off travel, and trying to get back into it. Plus, I am procrasting a little bit, because we have some big projects coming up! I am still human! &gt; Literally take your pick and we can begin Okay, I will pick a topic that I am more familiar with - Defense R&amp;D. My position is that, while there are many companies that do R&amp;D in the world of defense, there is also much innovation that comes from the government itself. GPS is one such technology. And while there are many very innovative companies that have built onto and done some amazing things with this technology, if it weren't for government investment and R&amp;D, it wouldn't exist. &gt; And yes, even people who advocate only higher taxes for the rich will end up with higher taxes for me (I.e. Bernie Sanders) What part of Bernie's proposal leads you to believe that?" }, { "docid": "258504", "title": "", "text": "In some states, it is your responsibility to pay the sales tax on a transaction, even if the party your purchase from doesn't collect it. This is common with online purchases across state lines; for example, here in Massachusetts, if I buy something from New Hampshire (where there is no sales tax), I am required to pay MA sales tax on the purchase when I file my income taxes. Buying a service that did not include taxes just shifts the burden of paperwork from the other party to me. Even if you would end up saving money by paying in cash, as other here have pointed out, you are sacrificing a degree of protection if something goes wrong with the transaction. He could take your money and walk away without doing the work, or do a sloppy job, or even damage your vehicle. Without a receipt, it is your word against his that the transaction ever even took place. Should you be worried that he is offering a discount for an under the table transaction? Probably not, as long as you don't take him up on it." }, { "docid": "142645", "title": "", "text": "\"It is definitely legal, however none of such expenses will be allowed as a tax deduction for the corporation. Basically, you'll end up paying more to maintain the entity and pay taxes on its income (the rent you're paying to yourself as a corporation) at corporate rates, for no apparent benefit. Being the director/executive in the corporation will make you liable for whatever the corporation is liable, so liability isn't going away. The reason corporation is considered \"\"limited liability\"\" for owners is because shareholders are shielded from the corporate liability. Not directors or executives (which are explicitly not shielded).\"" }, { "docid": "573071", "title": "", "text": "do I have to pay any tax? Technically this would be treated as Gift from non relatives and taxes as per gift tax rules. There is a limit of Rs 50,000 per year to receive funds from non-relatives. Note if the amount becomes Rs 50,001 then the entire Rs 50,001 is taxable. If you are again giving this money to your friend, then your friend is also liable to pay Gift Tax on the money received. It is best recommended that you have your friend open an account." }, { "docid": "262761", "title": "", "text": "I am not sure how they do it in the Nordic countries, but here in the US a lot of company owners like myself are taxed through the corporation. So in effect, raising taxes on corporations is the same as raising taxes on the business owner. That being said, I kind of agree with the sentiment of the article. If you lower taxes on me and my company, that money is going into savings. That money isn't going to be reinvested. Our budget is where our reinvestment comes from, not extra cash at the end of the year." }, { "docid": "209684", "title": "", "text": "\"I'm not an attorney or a tax advisor. The following is NOT to be considered advice, just general information. In the US, \"\"putting your name on the deed\"\" would mean making you a co-owner. Absent any other legal agreement between you (e.g. a contract stating each of you owns 50% of the house), both of you would then be considered to own 100% of the house, jointly and severally: In addition, the IRS would almost certainly interpret the creation of your ownership interest as a gift from your partner to you, making them liable for gift tax. The gift tax could be postponed by filing a gift tax return, which would reduce partner's lifetime combined gift/estate tax exemption. And if you sought to get rid of your ownership interest by giving it to your partner, it would again be a taxable gift, with the tax (or loss of estate tax exemption) accruing to you. However, it is likely that this is all moot because of the mortgage on the house. Any change to the deed would have to be approved by the mortgage holder and (if so approved) executed by a title company/registered closing agent or similar (depending on the laws of your state). In my similar case, the mortgage holder refused to add or remove any names from the deed unless I refinanced (at a higher rate, naturally) making the new partners jointly liable for the mortgage. We also had to pay an additional title fee to change the deed.\"" }, { "docid": "188473", "title": "", "text": "Yes, if you gift him with a large amount you may be liable for gift tax. I believe the current limit is still $17k per person per person per year, so between you and your spouse you could give him up to $34k per year without triggering gift tax. If you want to give a larger sum, the standard workaround is an intra-family loan. Websearch for that phrase to learn more about it, but basically you loan the money and then gift the payments on the loan. This gives him the money up front, spreading the gift over subsequent years --but it requires that you declare the interest that he is supposedly paying you as income. There is a lower limit on the interest rate for these loans, but it's a fraction of a percent so this generally isn't a significant cost. (If you are able to structure the loan as a mortgage, he may be able to deduct the interest from his taxes. That usually requires a few hundred dollars if paperwork to set up.) I've done it. It works. And one of the advantages is that it puts the exact terms of the lian on paper where everyone can agree to them, which could be useful should there be arguments later on. When doing business with friends and relatives, keeping it on a clear business contract basis is the best way to avoid destroying the friendship." }, { "docid": "536374", "title": "", "text": "\"Re: Specifically, am I right in that everything I put on these is deducted from tax, or are there other rules? and Am I correctly understanding this as \"\"anything above £3,600 per year will not be deducted from your tax\"\"? Neither interpretation seems quite right… Unless what you mean is this: The contributions (to a pension, or to the share-save scheme) are deducted from your pay before it is taxed. That's how it works for employer-run pension schemes. In other words, you are paying the gross amount you earn into the pension, not the amount after tax. It's a tax-efficient way to save, because: compared to other forms of saving: (The bit about the £3,600: you can ignore this assuming you're earning more than £3,600 a year.) What happens to the pension if you decide to move back to France or another country? In some cases you can transfer tax free. Worst case, you'd pay some tax on the transfer but not more than 25%. [See here for the current rules: https://www.gov.uk/transferring-your-pension/transferring-to-an-overseas-pension-scheme. Re: the share scheme, if by 'salary exchange' you mean salary sacrifice (where your gross pay is officially reduced by that amount e.g. £150 a month), that's even more tax-efficient, because it saves you paying the National Insurance contribution too (approx 9% of the pay packet). Conclusion: Saving into pension and company share save schemes is supremely tax-efficient and, provided you're OK with your money being locked away until you're 57 (pension) or tied up in company shares, it's understandably many people's priority to make use of these schemes before considering other forms of saving where you pay into them from your salary after tax. Now, about this: I am trying to understand how much I should put into it Should I put money into these, or should look for another way to save (how will this work out if I go back to France or another country)? Nobody here can advise you what to do since individuals' goals and circumstances are different and we don't know enough of the picture. That said: FWIW, I'll tell you what I might do based solely on what you've told us in the question… First, I'd definitely contribute 6% to the company pension. This gets you the full employer match. That's free money (plus, remember the tax relief = more free money). If you're 27, a total of 12% salary into a pension a year is a decent rate to start saving for retirement. Actually, 14% would be generally advisable, and maybe more still – it's generally a case of 'the more the better' especially while young, as you have time for growth and you don't know what later priorities might change / financial needs might arise. Nevertheless, you said you might move overseas. So in your position I would then:\"" }, { "docid": "318260", "title": "", "text": "\"Besides money and time lost, it is pretty clear that most tax advisors are not well versed in non-resident taxes. It seems that their main clients are either US residents or H1B workers (who are required to file as residents). I share your pain on this one. In fact, even for H1B/green card holders or Americans with income/property abroad vast majority of advisers will make mistakes (which may become quite costly). IRS licensing exams for EA/RTRP do not include a single question on non-resident taxation or potential issues, let alone handling treaties. Same goes for the AICPA unified CPA exam (the REG portion of which, in part, deals with taxes). I'm familiar with the recent versions of both exams and I am very disappointed and frustrated by that lack of knowledge requirement in such a crucial area (I am not a licensed tax preparer now though). That said, the issue is very complicated. I went through several advisers until I found the one I can trust to know her stuff, and while at it happened to learn quite a lot about the US tax code (which doesn't make me sleep any better by the least). It is my understanding that preparing a US tax return for a foreign person without a mistake is impossible, but the question is how big is the mistake you're going to make. I had returns prepared by solo working advisers where I found mistakes as ridiculous as arithmetic calculation errors (fired after two seasons), and by big-4 firms where I found mistakes that cost me quite a lot (although by the time I figured that they cost me significant amounts, it was too late to sue or change; fired after 2 seasons as well). As you can see, it is relevant to me as well, and I do not do my own tax returns. I usually ask for the conservative interpretations from my adviser, IRS is very aggressive on enforcement and the penalties, especially on foreigners are draconian (I do not know if it ever went through a judicial review, as I believe some of these penalties are unconstitutional under the 8th amendment, but that's my personal opinion). Bottom line - its hard to find a decent tax adviser, and that's why the good ones are expensive. You get what you pay for. How do I go about locating a CPA/EA who is well versed in non-resident taxes located in the Los Angeles area (Orange County area is not too far away either) These professionals are usually active in large metropolitan areas with a lot of foreigners. You should be able to find decent professionals in LA/OC, SF Bay, Seattle, New York, Boston, and other cities and metropolises attracting foreigners. Also, look for those working in the area of a major university. Specific points: If I find none, can I work with a quaified person who lives in a different state and have him file my taxes on my behalf (electronically or via scans going back and forth) Yes. But that person my have a problem representing you in California (in case you're audited), unless he's an EA (licensed by the Federal government, can practice everywhere) or is licensed as a CPA or Attorney by the State of California. Is there a central registry of such quaified people I can view (preferably with reviews) - akin to \"\"yellow pages\"\" IRS is planning on opening one some time this year, but until then - not really. There are some commercial sites claiming to have that, but they're using the FOIA access to the IRS and states' listings, and may not have updated information. They definitely don't have updated license statuses (or any license statuses) or language/experience information. Wouldn't trust them.\"" }, { "docid": "32009", "title": "", "text": "\"So many complicated answers for a straight forward question. First to this point \"\"I am failing to see why would a person get an IRA, instead of just putting the same amount of money into a mutual fund...\"\" An IRA can be invested in a mutual fund. The IRA benefit over standard mutual fund is pre-tax contribution lowering your current tax liability. The advantage of an IRA over a 401k is control. Your employer controls where the 401k is invested, you control where your IRA is invested. Often employers have a very small number of options, because this keeps their costs with the brokerage low. 401k is AMAZING if you have employer matched contributions. Use them to the maximum your employer will match. After that OWN your IRA. Control is key when it comes to your money. On IRA's. Buy ROTH first. Contribute the calendar maximum. Then get a traditional. The benefit of ROTH is that you already paid taxes on the contribution so your withdrawal is not taxed AND they do not tax the interest earned like they do on a standard mutual fund.\"" }, { "docid": "260817", "title": "", "text": "If this chargeback failed then would it negatively affect my credit score? A credit score is a measure of how dependable of a borrower you are. Requesting a refund for not receiving goods not delivered as promised, whether it is successful or it fails, should not impact your credit score since it has no implications on the likelihood that you will pay back debts. The last time I used that gym was the 13th January 2017, and I rejoined on the 20th December, so I have used it for less than a month. Therefore I do not think I should have to pay for two months Keep in mind that you purchased a membership to the gym. Whether or not you actually use the gym you are liable to pay for every month that you retain the membership. Although it probably won't hurt to try to get a refund for the period where you didn't take advantage of your gym membership, you weren't actually charged for a service that you never received (like in the last case where they charged you after you cancelled your membership)." }, { "docid": "397920", "title": "", "text": "I heard that a C-Corp being a one person shop (no other employees but the owner) can pay for the full amount 100% of personal rent if the residence is being used as a home office. Sure. Especially if you don't mind being audited. Technically, it doesn't matter how the money gets where it goes as long as the income tax filings accurately describe the tax situation. But the IRS hates it when you make personal expenses from a business account, even if you've paid the required personal income tax (because their computers simply aren't smart enough to keep up with that level of chaos). Also, on a non-tax level, commingling of business and personal funds can reduce the effectiveness of your company's liability protection and you could more easily become personally liable if the company goes bankrupt. From what I understand the 30% would be the expense, and the 70% profit distribution. I recommend you just pay yourself and pay the rent from your personal account and claim the allowed deductions properly like everyone else. Why & when it would make sense to do this? Are there any tax benefits? Never, because, no. You would still have to pay personal income tax on your 70% share of the rent (the 30% you may be able to get deductions for but the rules are quite complicated and you should never just estimate). The only way to get money out of a corporation without paying personal income tax is by having a qualified dividend. That's quite complicated - your accounting has to be clear that the money being issued as a qualified dividend came from an economic profit, not from a paper profit resulting from the fact that you worked hard without paying yourself market value." } ]

[ { "docid": "144927", "title": "", "text": "\"You can accept almost anything mutually agreeable to you and the other party as payment. That's the definition of \"\"barter\"\". If you agree to trade manufactured goods for livestock, as long as both parties agree on the terms, I'm not aware of any law that would prohibit it. I hedged with \"\"almost\"\" because of course you can't accept something that is explicitly illegal. Like you can't say you'll accept cocaine as payment. Less obviously, there are laws regulating the sale of guns, nuclear fuel, agricultural products, etc. You'd still have to pay taxes, and it can get complicated to determine the taxable value of the transaction. Sorry, but you can't avoid taxes by getting your income in something other than cash.\"" } ]

[ { "docid": "423329", "title": "", "text": "\"**If** you can resist peer pressure... Go to their meeting, and make a \"\"counteroffer\"\" to their promise of gold-plated helicopters and private islands: You'll take a *mere* $100k salary instead (or if you already make that, double it - The number doesn't really matter). Then watch them hem and haw as they try to find a way to \"\"do you a favor\"\" by not accepting your far too generous offer. / Had a friend who made a pretty good living off going to Time Share demos for free weeks here and there scattered around luxury resorts. I should mention he was a *big* guy, and the \"\"guy #3 blocks the doorway* tactic wasn't particularly effective against him.\"" }, { "docid": "373410", "title": "", "text": "Gold is not legal tender. I can't walk into Walmart and buy groceries with 1/20 ounce of gold. I can't buy a TV or car with gold. And you can't *buy* money--that's not how it works. I can sell a barrel of oil or a whatever of copper in any currency, but that doesn't make either of them currencies in and of themselves." }, { "docid": "365829", "title": "", "text": "I can see a long-term existence for it. I doubt it will replace national currencies but I also think there is some value. Gold is purely speculative as well but it's thrived for a very long time. I see this as basically a digital version of gold." }, { "docid": "491523", "title": "", "text": "\"In the US, this was the case during the 19th century. There was a system of \"\"subscriptions\"\" between banks, where larger banks backed the smaller banks to some extent. In trade, notes from distant banks were not accepted or discounted relative to known local banks, or silver/gold coinage. There were a number of problems with this system which came to a head during the Panic of 1907. During this crisis, a cascading series of banking failures was only stopped by the personal intervention of JP Morgan. Even when Morgan intervened, it was very difficult to make capital available in a way that avoided the panic. The subsequent creation of the Federal Reserve was a response to that crisis.\"" }, { "docid": "84301", "title": "", "text": "\"&gt;If this were true, why force citizens to use a specific central bank's paper money via \"\"legal tender laws\"\"? You do not have as much of an idea of what you are talking about as you think you do. You can pay a person for their good or service in any sort of money you want, including gold, bitcoins, fishes, cupcakes, iron ore, or whatever. However, they must be willing to accept it. If you attempt to pay them in USD, however, they can't refuse. So why not start attempting to pay for things in semiconducters?\"" }, { "docid": "285185", "title": "", "text": "\"First of all, congratulations on saving some money. So many people these days do not even get that far. As far as investments, what is best for you depends heavily on your: Here is a quick summary of types of assets that are likely available to you, and my thoughts on why they may or may not be a good fit for your situation. Cash Equivalents Cash Equivalents are highly liquid, meaning you can get cash for them on fairly short notice. In particular, Money Markets and Certificates of Deposit (CDs) are also considered very safe when issued by a bank, as they are often insured against loss by the government up to a certain amount (this varies quite a lot by country within Europe, see the Wikipedia article here for additional detail. Please note that in the case of a CD, you are usually unable to get access to your money for the length of the investment period, which is usually a short period of time such as 3 months, 6 months, or 1 year. This is a good choice if you may need your money back on short notice, and your main goal is to preserve your principal. However, the returns tend to be very low and often do not keep pace with inflation, meaning that over several years, you may lose \"\"real\"\" purchasing power, even if you don't lose nominal value in your account. Special Note on Cash Equivalents If the money you want to invest is also your Emergency Fund, or you do not have an Emergency Fund, I would highly recommend Cash Equivalents. They will provide the highest level of Liquidity along with a short Time Horizon so that you can get your money as needed in the case of unforeseen expenses such as if your car breaks down. Debt Debt investments include government and corporate bonds. They are still considered relatively safe, as the issuer would need to default (usually this means they are in bankruptcy) in order for you not to be paid back. For example, German bonds have been considered safer than Greek bonds recently based on the underlying strength of the government. Unlike Cash Equivalents, these are not guaranteed against loss, which means that if the issuer defaults, you could lose up to 100% of your investment. Bonds have several new features you will need to consider. One is interest rate risk. One reason bonds perform better than cash equivalents is that you are taking on the risk that if interest rates rise, the fixed payments the bond promises will be worth less, and the face value of your bond will fall. While most bonds are still very Liquid, this means that if you need to sell the bond before it matures, you could lose money. As mentioned earlier, some bonds are riskier than others. Given that you are looking for a low-risk investment, you would want to select a bond that is considered \"\"invesment grade\"\" rather than a riskier \"\"junk\"\" bond. Debt investments are a good choice if you can afford to do without this money for a few years, and you want to balance safety with somewhat better returns than Cash Equivalents. Again though, I would not recommend investing in Debt until you have also built up a separate Emergency Fund. If you do choose to invest in bonds, I recommend that you diversify your risks by investing in a bond fund, rather than in just one company's or government's debt. This will reduce the likelihood that you will experience a catastrophic loss. Ownership Ownership assets includes stocks and other assets such as real estate and precious metals such as gold. While these investments can have high returns, in your situation I would strongly recommend that you not invest in these types of investments, for the following reasons: For these reasons, debt is considered a safer investment than equity for any particular company, government, or the market as a whole. Ownership assets are a good choice for people who have a high Risk Tolerance, long Time Horizon, low Liquidity needs, and will not be bothered by larger potential changes in the value of the investment at any given time. Special Note on Gold I would consider Gold a very risky investment and not a good fit for you at the moment based on what you've shared in your question. Gold is considered \"\"safe\"\" in the sense that people believe that if the economy goes into recession, depression, or collapses entirely, gold will continue to be valuable. In a post-apocalyptic world where paper money became worthless, it is still a good bet that gold will always be considered valuable within human society as a store of value. That being said, the price of gold fluctuates almost entirely based on how bad people think things are going to get. Think about the difference between gold and a company like Coca-Cola. Would you like to own 100% of Coca-Cola? Of course, because you know there is a very good chance that people will continue to spend money all over the world on their products. On the other hand, gold itself produces no products, no sales, no profits, and no cash flow. As such, if you buy gold, you are really making a speculative bet that gold will be in higher demand tomorrow than it is today. You are buying an asset (the gold) rather than part of a company's equity or debt that is designed to throw off payments to its investors in the form of bond payments or dividends. So, if people decide next year that things are improving, it is possible that gold could lose value, given that gold prices are at historically high levels. Gold could be a good choice for someone who has a large, well-diversified investment portfolio, and who is looking for a hedge to protect against inflation and other risks that they have taken on via their other investments. I hope that is helpful - best of luck in your choices. Let us know what you decide!\"" }, { "docid": "89311", "title": "", "text": "You can buy real gold, or you can buy shares of a gold ETF, or invest in gold futures contracts. There's a number of ways, but the goal is to be exposed to the price fluctuations of gold. I actually have a bank account through www.goldmoney.com. It works just like PayPal or a bank account. You send money and buy gold and then they send you a debit card linked to that account. When you swipe it, you're spending your gold. They also cater to business customers as well..you can send invoices to get paid, do payroll, and everything in between." }, { "docid": "35369", "title": "", "text": "\"Investing in gold without having physical gold is not really a hedge against inflation. GLD is really more for speculation, not protection against serious inflation. If there is any kind of inflation worth really protecting yourself against then one thing you will notice at its onset is a divergence in the price of physical and GLD; with GLD offering very little protection if any against inflation. Ultimately holders of GLD will demand physical metal and the physical price will rise and the paper price will fall. I would advise you to study physical gold before you purchase GLD for that reason. EDIT: Just adding this to my answer - I don't know why I didn't put it in before, and I hasten to add that I'm not an expert though a little investigation will show you that this is at least one option for owning gold. If you think of having the physical gold yourself at one end of the spectrum and buying GLD at the other; so that you don't need to take physical delivery, there is another scenario which I understand is in between (and sorry I don't actually know what it's referred to as) but it's where you buy the physical gold but instead of taking delivery the bars are stored for you in a vault - these bars are numbered and you actually own what you have paid for and theoretically you could go and visit your gold and actually remove it because it's your gold - as opposed to having paper GLD which in my understanding is a \"\"right to take physical delivery\"\" of gold - and this is slightly different - of course unlike GLD you actually have to pay a storage fee and of course unlike having the physical gold buried in your garden or something you are not entirely secure against say a robbery of the vault, and you are also depending on the company not to sell the same bar to more than one person - but that's the only think that their reputation is built on, and a company like that would live or die by the reputation - ( and of course you might lose the proverbial gold buried in the garden either, so nothing's 100% secure anyway really )\"" }, { "docid": "196596", "title": "", "text": "\"The benefit of having gold to trade is that there is almost always someone that will take gold when the fiat currency is in trouble. The potential downfall of doing this is that when people think the fiat currency is in trouble, they tend to buy up gold, thus driving up the price. This means that you get less gold for each hour of work you perform (deer-haunch, basket of apples, etc.). Even more, if the financial crisis is limited to only one fiat currency, you have a situation where that fiat currency devalues but others can gain in value as people try to sell their old currency for the new standard currency. If people also sell their gold to buy up this currency, that lowers the price of gold in that currency. For example, let us assume that gold was 1000 dollars an ounce and 1000 euros an ounce. Suddenly, people start thinking that the euro is in trouble, so they start buying gold. The law of supply and demand kicks in (more buyers, same supply, so higher prices) and gold is suddenly worth 2000 dollars and 2000 euros an ounce. If you start buying at this point, you get half as much gold as the person who bought in the beginning. Suddenly, the euro collapses. Stores that used to take euros start demanding dollars. Suddenly, it costs 20,000 euros for an ounce of gold but an ounce of gold will only get you 1,000 dollars since everyone is selling their gold to get dollars. The people who buy gold in the \"\"panic\"\" end up losing half the value of their money if not more. The \"\"speculators\"\" that bought gold at $1,000, sold it at $2,000, and bought it back at $1,000 now have all their gold back plus the $1,000 the other people lost.\"" }, { "docid": "371390", "title": "", "text": "My personal gold/metals target is 5.0% of my retirement portfolio. Right now I'm underweight because of the run up in gold/metals prices. (I haven't been selling, but as I add to retirement accounts, I haven't been buying gold so it is going below the 5% mark.) I arrived at this number after reading a lot of different sample portfolio allocations, and some books. Some people recommend what I consider crazy allocations: 25-50% in gold. From what I could figure out in terms of modern portfolio theory, holding some metal reduces your overall risk because it generally has a low correlation to equity markets. The problem with gold is that it is a lousy investment. It doesn't produce any income, and only has costs (storage, insurance, commissions to buy/sell, management of ETF if that's what you're using, etc). The only thing going for it is that it can be a hedge during tough times. In this case, when you rebalance, your gold will be high, you'll sell it, and buy the stocks that are down. (In theory -- assuming you stick to disciplined rebalancing.) So for me, 5% seemed to be enough to shave off a little overall risk without wasting too much expense on a hedge. (I don't go over this, and like I said, now I'm underweighted.)" }, { "docid": "308332", "title": "", "text": "I'm all-in on hard silver, a small portion is stored at my house for emergency expenditures and the vast majority is in a high-security vault in Canada. That was actually the cheapest place I could find for long-term storage and insurance, which happened to be off-shore. It could turn out to be beneficial to be off-shore though. In the 1930s gold became illegal to privately own its very possible they could do the same this time, although they didn't in 1979. Oil is too high in volume to reasonably store. Gold isn't as undervalued as silver, which I could spend a full day talking about. But to sum it up in a few points: there is less silver than there is gold, gold has a premium for jewelry which will likely go down in a crash even though you will still see gains, silver is the second most used commodity besides oil, less people are in the know about it, silver prices were actually higher than gold a few times in the past century, simply measuring the dow in silver will show it's further below the historical average compared to gold. I'll stop there, but I could go on though on silver if people want. Real-estate is still very expensive from the 2008 recession, traditionally mortgages are $1.05 per dollar you would spend on renting the same property. Currently real-estate is at like $1.25+ I believe, It peaked at about $1.95. I rent, to save money, which you can spend on other assets. If one's willing to move to another state for lower taxes, they definitely should. Employment is going to be harder to come by, and they should get as much out of it as possible as they can. If they don't save enough, they could end up just using their entire savings during the whole thing if they can't find a job, in which case at the end you'd never know they knew it was going to happen. Overall I don't think this crash is going to be like the great depression. I don't feel compelled to store food and buy a generator or anything. I believe the living will be *easier* than it were to live in the 90s for those who are invested in assets. Everything is going to be on sale, meanwhile their wealth will be increasing. Depending on how much they own it could be increasing faster than they need to spend it. Sounds like the life to me. But with that said those without real assets, especially the lower class, will be unemployed and living on food stamps. Perhaps even the food stamps making more people leave the dollar and the economy. This actually might not be a prediction and is what happening already. But I don't believe anybody, in america at least, will be starving. In the 30s we had not mastered industry farming yet and we had the *dustbowl* to make things worse. Crime though, I'd own a gun. The protesters are here already, and I think we are just passing the half-way point right now, they will get angrier. I don't know enough about taxes to know the best country or place to store to combat taxes. Maybe someone else can chime in. I'm in canada to avoid high insurance and storage fees. And for careful selection of primary residence, In the long haul I'd rent a small apartment, as small and cheap as possible. In a safe neighborhood, but not so much secluded that a single grocery store or gas station going out of business could ruin it." }, { "docid": "346735", "title": "", "text": "\"First of all, setting some basics: What is a sound way to measure the risk of each investment in order to compare them with each other ? There is no single way that can be used across all asset classes / risks. Generally speaking, you want to perform both a quantitative and qualitative assessment of risks that you identify. Quantitative risk assessment may involve historical data and/or parametric or non-parametric models. Using historical data is often simple but may be hard in cases where the amount of data you have on a given event is low (e.g. risk of bust by investing in a cryptocurrency). Parametric and non-parametric risk quantification models exist (e.g. Value at Risk (VaR), Expected Shortfall (ES), etc) and abound but a lot of them are more complicated than necessary for an individual's requirements. Qualitative risk assessment is \"\"simply\"\" assessing the likelihood and severity of risks by using intuition, expert judgment (where that applies), etc. One may consult with outside parties (e.g. lawyers, accountants, bankers, etc) where their advisory may help highlighting some risks or understanding them better. To ease comparing investment opportunities, you may want to perform a risk assessment on categories of risks (e.g. investing in the stock market vs bond market). To compare between those categories, one should look at the whole picture (quantitative and qualitative) with their risk appetite in mind. Of course, after taking those macro decisions, you would need to further assess risks on more micro decisions (e.g. Microsoft or Google ?). You would then most likely end up with better comparatives as you would be comparing items similar in nature. Should I always consider the worst case scenario ? Because when I do that, I always can lose everything. Generally speaking, you want to consider everything so that you can perform a risk assessment and decide on your risk mitigating strategy (see Q4). By assessing the likelihood and severity of risks you may find that even in cases where you are comparatively as worse-off (e.g. in case of complete bust), the likelihood may differ. For example, keeping gold in a personal stash at home vs your employer going bankrupt if you are working for a large firm. Do note that you want to compare risks (both likelihood and severity) after any risk mitigation strategy you may want to put in place (e.g. maybe putting your gold in a safety box in a secure bank would make the likelihood of losing your gold essentially null). Is there a way to estimate the probability of such events, better than intuition ? Estimating probability or likelihood is largely dependent on data on hand and your capacity to model events. For most practical purposes of an individual, modelling would be way off in terms of reward-benefits. You may therefore want to simply research on past events and assign them a 1-5 (1 being very low, 5 being very high) risk rating based on your assessment of the likelihood. For example, you may assign a 1 on your employer going bankrupt and a 2 or 3 on being burglarized. This is only slightly better than intuition but has the merit of being based on data (e.g. frequency of burglary in your neighborhood). Should I only consider more probable outcomes and have a plan for them if they occur? This depends largely on your risk appetite. The more risk averse you are, the more thorough you will want to be in identifying, tracking and mitigating risks. For the risks that you have identified as relevant, or of concern, you may opt to establish a risk mitigating strategy, which is conventionally one of accepting, sharing (by taking insurance, for example), avoiding and reducing. It may not be possible to share or reduce some risks, especially for individuals, and so often the response will be either to accept or avoid the given risks by opting in or out on an opportunity.\"" }, { "docid": "474924", "title": "", "text": "\"1. As I said, the above is not actually anything like a genuine history of how money emerged, it's an explain-it-to-a-five-year-old parable to answer \"\"where does the money go in an economic contraction?\"\" 2. It's also not defense/endorsement/apology for any particular set of policies or historical theory of money. It's a picture-book describing the workings of an internal combustion engine using cartoon characters, not a treatise on the social and environmental implications of American car-culture. That said, in the parable, the reasons why the simplified caricatures in the town chose to accept the fiat currency are pretty straightforward, and are actually explained: - They were previously using a system of a whole bunch of separate, privately-issued currencies, each with complex and hard-to-evaluate credit risks (Bob's potato certificate versus Jane's Potato certificate versus your apple-certificate versus my deer certificate). This was causing problems and confusion about how much any given certificate was actually worth. - The system proposed was proposed in a way that was *at least* as credible as the best existing system. - Last but not least, they accepted the new currency for *exactly the same reason* that you accept dollar, euros, or whatever: because everyone else does. There was no law preventing any of them from still trading apple IOUs (in fact, we still traded them, later in the example, except denominated in loddars). I could have asked you for the last note to denominated in apples, but that would probably have been harder to trade than the currency that everyone else is using. I said I wouldn't get into the gold-standard debate, and I won't, and here's why: the debate hinges entirely and solely on whether you believe that a \"\"good\"\" fiat currency is possible and realistically sustainable. If you do, then fiat currency makes a lot more sense in every respect. If you don't, then fiat currency is always just a catastrophe waiting to happen. My parable shows the mechanics of how money works. It doesn't say whether the system is good or bad, or whether they should have accepted the fiat system proposed, or held out for a better one, or rejected it altogether. You can argue that internal combustion engines are bad, or that much better alternatives are available, or that nobody should use them, but that doesn't make a description of they work incorrect.\"" }, { "docid": "240894", "title": "", "text": "\"Gold may have some \"\"intrinsic value\"\" but it cannot be accurately determined by investors by any known valuation techniques. In fact, if you were to apply the dividend discount model of John Burr Williams - a variation of which is the basis of Discounted Cash Flow (DCF) analysis and the basis of most valuation techniques - gold would have zero intrinsic value because it produces no cash flow. Legendary focus investor Warren Buffett argues that investing in gold is pure speculation because of the reason mentioned above. As others have mentioned, gold prices are affected by supply and demand, but the bigger influence on the price of gold is how the economy is. Gold is seen as a store of value because, according to some, it does not \"\"lose value\"\" unlike paper currency during inflation. In inflationary times, demand increases so gold prices do go up, which is why gold behaves similar to a commodity but has far less uses. It is difficult to argue whether or not gold gains or loses value because we can't determine the intrinsic value of gold, and anyone who attempts to justify any given price is pulling blinders over your eyes. It is indisputable that, over history, gold represents wealth and that in the past century and the last decade, gold prices rise in inflationary conditions as people dump dollars for gold, and it has fallen when the purchasing power of currency increases. Many investors have talked about a \"\"gold bubble\"\" by arguing that gold prices are inflated because of inflation and the Fed's money policy and that once interest rates rise, the money supply will contract and gold will fall, but again, nobody can say with any reasonable accuracy what the fair value of gold at any given point is. This article on seeking alpha: http://seekingalpha.com/article/112794-the-intrinsic-value-of-gold gives a quick overview, but it is also vague because gold can't be accurately priced. I wouldn't say that gold has zero intrinsic value because gold is not a business so traditional models are inappropriate, but I would say that gold *certainly * doesn't have a value of $1,500 and it's propped so high only because of investor expectation. In conclusion, I do not believe you can accurately state whether gold is undervalued or overvalued - you must make judgments based on what you think about the future of the market and of monetary policy, but there are too many variables to be accurate consistently.\"" }, { "docid": "239509", "title": "", "text": "\"It's not clear that anything needs to go up if gold goes down. In a bubble, asset prices can just collapse, without some other asset increasing to compensate. Economies are not a zero-sum game. On the other hand, gold may fall when people decide they don't need to hoard some store of value that, to their minds, never changes. It could very well indicate that there is more confidence in the broader economy. I am not a gold bug, so I don't much see the point in \"\"investing\"\" in something that is non-productive and also inedible, but to each his own.\"" }, { "docid": "137444", "title": "", "text": "\"Why does the value of gold go up when gold itself doesn't produce anything? Why do people invest in gold? Your perception, that the value of gold goes up in the long run, is based on the price of gold measured in your favorite paper currency, for example the US Dollar. An increasing price of gold means that in the visible gold market, market participants are willing to exchange more paper currency units for the same amount of gold. There are many possible reasons for this: While HFT became extremely important for the short term price movements, I will continue with long term effects, excluding HFT. So when - as a simple thought experiment - the amount of available paper currency units (US $ or whatever) doubles, and the amount of goods and services in an economy stay the same, you can expect that the price of everything in this economy will double, including gold. You might perceive that the value of gold doubled. It did not. It stayed the same. The number of printed dollars doubled. The value of gold is still the same, its price doubled. Does the amount of paper currency units grow over time? Yes: https://research.stlouisfed.org/fred2/series/BASE/ In this answer my term \"\"paper currency units\"\" includes dollars that exist only as digits in bank accounts and \"\"printing currency\"\" includes creating those digits in bank accounts out of thin air. So the first answer: gold holds its value while the value of paper currency units shrinks over time. So gold enables you to pass wealth to the next generation (while hiding it from your government). That gold does not produce anything is not entirely true. For those of us mortals who have only a few ounces, it is true. But those who have tons can lease it out and earn interest. (in practice it is leased out multiple times, so multiple that gain. You might call this fraud, and rightfully so. But we are talking about tons of gold. Nobody who controls tons of physical gold goes to jail yet). Let's talk about Fear. You see, the perceived value of gold increases as more paper currency is printed. And markets price in expected future developments. So the value of gold rises, if a sufficient number of wealthy people fear the the government(s) will print too much paper currency. Second Answer: So the price of gold not only reflects the amount of paper currency, it is also a measurement of distrust in government(s). Now you might say something is wrong with my argument. The chart mentioned above shows that we have now (mid 2015) 5 times as much printed currency units than we had 2008. So the price of gold should be 5 times as high as 2008, assuming the amount of distrust in governments stayed the same. There must be more effects (or I might be completely wrong. You decide). But here is one more effect: As the price of gold is a measurement of distrust in governments (and especially the US government since the US Dollar is perceived as the reserve currency), the US government and associated organizations are extremely interested in low gold prices to prove trust. So people familiar with the topic believe that the price of gold (and silver) is massively manipulated to the downside using high frequency trading and shorts in the futures markets by US government and wall street banks to disprove distrust. And wall street banks gain huge amounts of paper currency units by manipulating the price, mostly to the downside. Others say that countries like china and russia are also interested in low gold prices because they want to buy as much physical gold as possible. Knowing of the value that is not reflected by the price at the moment. Is there one more source of distrust in governments? Yes. Since 1971, all paper currencies are debt. They receive their value by the trust that those with debt are willing and able to pay back their debt. If this trust is lost, the downward manipulation (if you think that such a thing exists) of the gold and silver prices in the futures markets might fail some day. If this is the case (some say when this is the case). you might see movements in gold and silver prices that bring them back to equilibrium with the amount of printed paper currencies. In times of the roman empire you got a good toga and a pair of handmade shoes for an ounce of gold. In our days, you get a nice suite and a good pair of shoes for an ounce of gold. In the mean time, the value of each paper currency in the history of each country went to zero and the US $ lost 98% of its initial value. As long as there is not enough distrust, more paper currency is made in equity markets and bond markets on average. (Be aware that you earn that currency only after you were able to sell at this price, not while you hold it) Gerd\"" }, { "docid": "272547", "title": "", "text": "\"Ok, I think what you're really asking is \"\"how can I benefit from a collapse in the price of gold?\"\" :-) And that's easy. (The hard part's making that kind of call with money on the line...) The ETF GLD is entirely physical gold sitting in a bank vault. In New York, I believe. You could simply sell it short. Alternatively, you could buy a put option on it. Even more risky, you could sell a (naked) call option on it. i.e. you receive the option premium up front, and if it expires worthless you keep the money. Of course, if gold goes up, you're on the hook. (Don't do this.) (the \"\"Don't do this\"\" was added by Chris W. Rea. I agree that selling naked options is best avoided, but I'm not going to tell you what to do. What I should have done was make clear that your potential losses are unlimited when selling naked calls. For example, if you sold a single GLD naked call, and gold went to shoot to $1,000,000/oz, you'd be on the hook for around $10,000,000. An unrealistic example, perhaps, but one that's worth pondering to grasp the risk you'd be exposing yourself to with selling naked calls. -- Patches) Alternative ETFs that work the same, holding physical gold, are IAU and SGOL. With those the gold is stored in London and Switzerland, respectively, if I remember right. Gold peaked around $1900 and is now back down to the $1500s. So, is the run over, and it's all downhill from here? Or is it a simple retracement, gathering strength to push past $2000? I have no idea. And I make no recommendations.\"" }, { "docid": "565782", "title": "", "text": "Another answer to this question occurred to me as I started learning more about historical uses for gold etc. Perhaps it's a crackpot idea, but I'm going to float it anyway to see what you folks think. Investing in Gold is an indirect investment in the Economy and GDP of the nation of India. To that extent is it only a hedge against inflation, so long as the indian economy grows at a more rapid rate than your local inflation rate. Fact, India currently consumes more than 1/3 of gold production, predominantly in the form of Jewelry. And their demand has been growing rapidly, up 69% just between 2009 and 2010 alone. I can't find too many historial consumption numbers for India, but when you look at past articles on this subject, you see phrases like 'one forth' and '20%' being used only a few years go to describe India's consumption levels. Fact, India has virtually no domestic sources of gold. India’s handful of gold mines produce about 2.5 tonnes of the metal each year, a fraction of the country’s annual consumption of about 800 tonnes. Fact. Indian Culture places high value on gold as a visible demonstration of wealth. Particularly in situations such In Indian weddings where the bride brings in gold to show her family's status and wealth and it forms part of the dowry given to bride. It is believed that a bride wearing 24k gold on their wedding to bring luck and happiness throughout the married life. Fact, the recent trends in outsourcing, Indian citizens working abroad sending money home, etc have all lead to a influx of foreign cash to the Indian economy and explosive GDP growth. See the following chart and compare the period of 2000-current with a chart showing the price of gold in other answer here. Notice how the curves parallel each other to a large degree Potentially unfounded conclusion drawn from above numbers. The rapid growth of the Indian economy, coupled with a rich cultural tradition that values gold as a symbol of wealth, along with a sudden rise in 'wealthy' people due to the economy and influx of foreign cash, has resulted in skyrocketing demand for gold from India, and this large 'consumption' demand is the most likely explanation for the sudden rise in the price of gold over the last several years. Investors then jump on the 'rising price bandwagon' as especially does anyone that can make a profit from selling gold to those seeking to get on said bandwagon. As such, as long as indian cultural tradition remains unchanged, and their economy remains strong, the resulting increasing demand for gold will sustain current and perhaps increased prices. Should there be any sudden collapse in the Indian GDP, gold will likely tumble in parallel. disclaimer: not an expert, just observations based off the data I've seen, there may be other parts to the picture of 'gold demand' that I've not considered." }, { "docid": "542788", "title": "", "text": "\"Gold has very useful physical properties for some engineering applications. Even tiny amounts of gold can substantially improve products, so it can be worthwhile to pay high prices per ounce for gold. For example: Gold can be \"\"beaten\"\" or electroplated to produce very thin shiny coatings. Entire roofs (of famous buildings) have been covered with \"\"gold leaf\"\", at a cost that was small compared to the supporting structure. A very thin layer of electroplated gold provides better protection against corrosion than a much thicker layer of electroplated nickel. Even if gold costs thousands of times more per ounce than nickel, it is cheaper to use gold as an anti-corrosion layer than nickel (for use in military-grade naval electronics). A thin layer of electroplated gold greatly increases the electrical current-carrying capacity of a thin copper wire.\"" } ]

[ { "docid": "295980", "title": "", "text": "Of course you can accept gold as payment. Would anyone pay in gold? Would it have tax consequences on your federal taxes? These additional questions are off-topic on this site about personal finance." } ]

[ { "docid": "566458", "title": "", "text": "What is the best way that I can invest money so that I can always get returns? If you want something that doesn't require any work on your end, consider having a fee-only financial planner make a plan so that your investments can be automated to generate a cash flow for you or get an annuity as the other classic choices here as most other choices will require some time commitment in one form or other. Note that for stock investments there could be rare instances like what happened for a week in September in 2001 where the markets were closed for 5 days straight that can be the hiccup in having stocks. Bonds can carry a risk of default where there have been municipalities that defaulted on debt as well as federal governments like Russia in the 1990s. Real estate may be subject to natural disasters or other market forces that may prevent there always being a monthly payment coming as if you own a rental property then what happens if there aren't tenants because there was an evacuation of the area? There may be some insurance products to cover some of these cases though what if there are exceptionally high claims all at once that may have an insurance company go under? Would it be to set up an FD in a bank, to buy land, to buy a rental house, to buy a field, or maybe to purchase gold? What investment of your own time do you plan on making here? Both in terms of understanding what your long-term strategy is and then the maintenance of the plan. If you put the money in the bank, are you expecting that the interest rate will always be high enough to give you sufficient cash to live as well as having no financial crisis with the bank or currency you are using? Are there any better investments? You may want to reconsider what assumptions you want to make and what risks you want to accept as there isn't likely to be a single solution here that would be perfect." }, { "docid": "305346", "title": "", "text": "Since 2007 the world has seen a period of striking economic and financial volatility featuring the deepest recession since the 1930s despite this gold has performed strongly with its price roughly doubling since the global financial crisis began in mid-2007. 1. Gold and real interest rates: One of the factor that influences gold prices is real interest rate which is to some extent related to inflation. Since gold lacks a yield of its own, the opportunity cost of holding gold increases with a real interest rate increase and decreases with a fall in real interest rates. 2. Gold and the US dollar: The external value of the US dollar has been a significant influence on short-term gold price movements. The IMF estimated6 in 2008 that 40-50% of the moves in the gold price since 2002 were dollar-related, with a 1% change in the effective external value of the dollar leading to a more than 1% change in the gold price (Source). 3. Gold and financial stress: It is a significant and commonly observed influence on the short-term price of gold. In periods of financial stress gold demand may rise for a number of reasons: 4. Gold and political instability: It is another factor that can boost gold prices. Investor concerns about wars, civil conflicts and international tensions can boost demand for gold for similar reasons to those noted above for periods of financial stress. Gold‟s potential function as a „currency of last resort‟ in case of serious system collapse provides a particular incentive to hold it in case the political situation is especially severe. (Source) 5. Gold and official sector activity: The behaviour of central banks and other parts of the official sector can have an important impact on gold prices. One reason for this is that central banks are big holders of gold, possessing some 30,500 metric tons in 2010, which is approximately 15% of all above-ground gold stocks. As a result, central bank policies on gold sales and purchases can have significant effects, and these policies have been subject to considerable shifts over the decades. (Source) (Source of above graphs)" }, { "docid": "371390", "title": "", "text": "My personal gold/metals target is 5.0% of my retirement portfolio. Right now I'm underweight because of the run up in gold/metals prices. (I haven't been selling, but as I add to retirement accounts, I haven't been buying gold so it is going below the 5% mark.) I arrived at this number after reading a lot of different sample portfolio allocations, and some books. Some people recommend what I consider crazy allocations: 25-50% in gold. From what I could figure out in terms of modern portfolio theory, holding some metal reduces your overall risk because it generally has a low correlation to equity markets. The problem with gold is that it is a lousy investment. It doesn't produce any income, and only has costs (storage, insurance, commissions to buy/sell, management of ETF if that's what you're using, etc). The only thing going for it is that it can be a hedge during tough times. In this case, when you rebalance, your gold will be high, you'll sell it, and buy the stocks that are down. (In theory -- assuming you stick to disciplined rebalancing.) So for me, 5% seemed to be enough to shave off a little overall risk without wasting too much expense on a hedge. (I don't go over this, and like I said, now I'm underweighted.)" }, { "docid": "61329", "title": "", "text": "By mentioning GLD, I presume therefore you are referring to the SPRD Gold Exchange Traded Fund that is intended to mirror the price of gold without you having to personally hold bullion, or even gold certificates. While how much is a distinctly personal choice, there are seemingly (at least) three camps of people in the investment world. First would be traditional bond/fixed income and equity people. Gold would play no direct role in their portfolio, other than perhaps holding gold company shares in some other vehicle, but they would not hold much gold directly. Secondly, at the mid-range would be someone like yourself, that believes that is in and of itself a worthy investment and makes it a non-trivial, but not-overriding part of their portfolio. Your 5-10% range seems to fit in well here. Lastly, and to my taste, over-the-top, are the gold-gold-gold investors, that seem to believe it is the panacea for all market woes. I always suspect that investment gurus that are pushing this, however, have large positions that they are trying to run up so they can unload. Given all this, I am not aware of any general rule about gold, but anything less than 10% would seem like at least a not over-concentration in the one area. Once any one holding gets much beyond that, you should really examine why you believe that it should represent such a large part of your holdings. Good Luck" }, { "docid": "337243", "title": "", "text": "\"Definitely look at CEF. They have tax advantages over GLD and SLV, and have been around for 50 years, and are a Canadian company. They hold their gold in 5 distributed vaults. Apparently tax advantage comes because with GLD, if you supposedly approach them with enough money, you can take out a \"\"bar of gold\"\". Just one problem (well, perhaps more): a bar of gold is an enormous sum of money (and as such not very liquid), and apparently gold bars have special certifications and tracking, which one would mess up if one took it to there personal collection, costing additional sums to re-certify. many, many articles on the web claiming that the gold GLD has is highly leveraged, is held by someone else, and tons of other things that makes GLD seem semi-dubious. I've used CEF for years, talked to them quite a few times; to me, and short of having it my possession, they seem the best /safest / easiest alternative, and are highly liquid/low spread betwen bid and ask. The do also have a pure gold \"\"stock\"\" and a pure silver \"\"stock\"\", but these often trade at higher premiums. CEF's premium varies between -2% and +4%. I.e. sometimes it trades at a premium to the gold and silver it holds, sometimes at a discount. Note that CEF generally shoots to have a 50/50 ratio of gold / silver holdings in their possession/vaults, but this ratio has increased to be heavier gold weighted than silver, as silver has not performed quite as well lately. You can go to their web-site and see exactly what they have, e.g. their NAV page: http://www.centralfund.com/Nav%20Form.htm\"" }, { "docid": "502634", "title": "", "text": "\"Buying gold, silver, palladium, copper and platinum. The first two I am thinking about new currencies. The last three for the perpetual need for the metals in industry. I also have invested in Numismatic coins. They are small portable and easy to hide around the house. I only collect silver coins, so even if the world really blows up and numismatics goes out the window, I can depend on them forming a barter system through the content value of the silver. The problem with collectable items is that they are easy to see. For example, a nice painting just shouts out \"\"steal me!\"\". I don't buy large gold coins. As long as the coin is below 1/4 Oz gold I collect it. If the dollar does finaly collapse, to be honest it will be so bad that I think weapons will be order of the day. Do I think it will collapse...nah never.\"" }, { "docid": "414868", "title": "", "text": "\"We were on the \"\"gold standard\"\" in name only since about 1910. There was not enough gold to remotely back the US currency, which is why during the great depression when people started wanting to turn their cash back in to gold there was no enough, and gold possession had to be outlawed (well, partially). So no, we were not on a gold standard. Secondly, when you're on a (any fixed item) standard, your economy only can grow at roughly the rate you fond more of the (fixed item). There are many reasons for this, and it is partially why for thousands of years of various gold standard there was so little economic growth. Once countries stopped limiting the amount of total economic growth to the amount of gold they could dig up, that economies were able to grow at the sustained rate they have for the past 200ish years. So, besides the fact that the US has not in modern history been backed by gold, despite the name, there is ample evidence from hundreds of economies and thousands of years that being on a gold standard = little or no economic growth.\"" }, { "docid": "305794", "title": "", "text": "You acquire something because you expect to use it, or because you expect to exchange it for something that you want to use. Gold is a good candidate for storing value because it's rare, it's not easily counterfeited, it's divisible, it's portable, etc. Contrast this with your favorite currency: more can be printed up almost at will, etc. Overvaluedness/undervaluedness is only in reference to something else. How many dollars does it take to buy an ounce of gold? (About $1,500.) How many ounces does it take to equal the DJIA? (About 8.) How many ounces of silver does it take to buy an ounce of gold? How many barrels of oil can you buy with an ounce of gold? Etc., etc. But whatever measure you're using, the value of the gold you have is directly related to the mass of gold you own. Two ounces are twice as valuable as one ounce. As the old joke goes (no offense to taxi drivers intended!) when your cabbie starts talking about how to get rich with gold, it's probably overvalued. Sell it all! ;)" }, { "docid": "272547", "title": "", "text": "\"Ok, I think what you're really asking is \"\"how can I benefit from a collapse in the price of gold?\"\" :-) And that's easy. (The hard part's making that kind of call with money on the line...) The ETF GLD is entirely physical gold sitting in a bank vault. In New York, I believe. You could simply sell it short. Alternatively, you could buy a put option on it. Even more risky, you could sell a (naked) call option on it. i.e. you receive the option premium up front, and if it expires worthless you keep the money. Of course, if gold goes up, you're on the hook. (Don't do this.) (the \"\"Don't do this\"\" was added by Chris W. Rea. I agree that selling naked options is best avoided, but I'm not going to tell you what to do. What I should have done was make clear that your potential losses are unlimited when selling naked calls. For example, if you sold a single GLD naked call, and gold went to shoot to $1,000,000/oz, you'd be on the hook for around $10,000,000. An unrealistic example, perhaps, but one that's worth pondering to grasp the risk you'd be exposing yourself to with selling naked calls. -- Patches) Alternative ETFs that work the same, holding physical gold, are IAU and SGOL. With those the gold is stored in London and Switzerland, respectively, if I remember right. Gold peaked around $1900 and is now back down to the $1500s. So, is the run over, and it's all downhill from here? Or is it a simple retracement, gathering strength to push past $2000? I have no idea. And I make no recommendations.\"" }, { "docid": "35875", "title": "", "text": "\"As mentioned in other answers, you find out by reading the Rulebook for that commodity and exchange. I'll quote a couple of random passages to show how they vary: For CME (Chicago Mercantile Exchange) Random Length Lumber Futures, the delivery is ornate: Seller shall give his Notice of Intent to Deliver to the Clearing House prior to 12:00 noon (on any Business Day after termination of trading in the contract month. 20103.D. Seller's Duties If the buyer's designated destination is east of the western boundaries of North Dakota, South Dakota, Nebraska, Kansas, Texas and Oklahoma, and the western boundary of Manitoba, Canada, the seller shall follow the buyer's shipping instructions within seven (7) Business Days after receipt of such instructions. In addition, the seller shall prepay the actual freight charges and bill the buyer, through the Clearing House, the lowest published freight rate for 73-foot railcars from Prince George, British Columbia to the buyer's destination. If the lowest published freight rate from Prince George, British Columbia to buyer's destination is a rate per one hundred pounds, the seller shall bill the buyer on the weight basis of 1,650 pounds per thousand board feet. The term \"\"lowest published freight rate\"\" refers only to the lowest published \"\"general through rate\"\" and not to rates published in any other rate class. If, however, the buyer’s destination is outside of the aforementioned area, the seller shall follow the same procedures except that the seller shall have the right to change the point of origin and/or originating carrier within 2 Business Days after receipt of buyer’s original shipping instructions. If a change of origin and/or originating carrier is made, the seller shall then follow the buyer's revised instructions within seven (7) Business Days after receipt of such instructions. If the freight rate to the buyer's destination is not published, the freight charge shall be negotiated between the buyer and seller in accordance with industry practice. Any additional freight charges resulting from diversion by the buyer in excess of the actual charges for shipment to the destination specified in the shipping instructions submitted to the Clearing House are the responsibility of the buyer. Any reduction in freight charges that may result from a diversion is not subject to billing adjustment through the Clearing House. Any applicable surcharges noted by the rail carrier shall be considered as part of the freight rate and can be billed to the buyer through the CME Clearing House. If within two (2) Business Days of the receipt of the Notice of Intent the buyer has not designated a destination, or if during that time the buyer and seller fail to agree on a negotiated freight charge, the seller shall treat the destination as Chicago, Illinois. If the buyer does not designate a carrier or routing, the seller shall select same according to normal trade practices. To complete delivery, the seller must deposit with the Clearing House a Delivery Notice, a uniform straight bill of lading (or a copy thereof) and written information specifying grade, a tally of pieces of each length, board feet by sizes and total board feet. The foregoing documents must be received by the Clearing House postmarked within fourteen (14) Business Days of the date of receipt of shipping instructions. In addition, within one (1) Business Day after acceptance by the railroad, the Clearing House must receive information (via a telephone call, facsimile or electronic transmission) from the seller giving the car number, piece count by length, unit size, total board footage and date of acceptance. The date of acceptance by the railroad is the date of the bill of lading, signed and/or stamped by the originating carrier, except when determined otherwise by the Clearing House. For some commodities you can't get physical delivery (for instance, Cheese futures won't deliver piles of cheese to your door, for reasons that may be obvious) 6003.A. Final Settlement There shall be no delivery of cheese in settlement of this contract. All contracts open as of the termination of trading shall be cash settled based upon the USDA monthly weighted average price in the U.S. for cheese. The reported USDA monthly weighted average price for cheese uses both 40 pound cheddar block and 500 pound barrel prices. CME gold futures will deliver to a licensed depository, so you would have to arrange for delivery from the depository (they'll issue you a warrant), assuming you really want a 100 troy oz. bar of gold: CONTRACT SPECIFICATIONS The contract for delivery on futures contracts shall be one hundred (100) troy ounces of gold with a weight tolerance of 5% either higher or lower. Gold delivered under this contract shall assay to a minimum of 995 fineness and must be a brand approved by the Exchange. Gold meeting all of the following specifications shall be deliverable in satisfaction of futures contract delivery obligations under this rule: Either one (1) 100 troy ounce bar, or three (3) one (1) kilo bars. Gold must consist of one or more of the Exchange’s Brand marks, as provided in Chapter 7, current at the date of the delivery of contract. Each bar of Eligible gold must have the weight, fineness, bar number, and brand mark clearly incised on the bar. The weight may be in troy ounces or grams. If the weight is in grams, it must be converted to troy ounces for documentation purposes by dividing the weight in grams by 31.1035 and rounding to the nearest one hundredth of a troy ounce. All documentation must illustrate the weight in troy ounces. Each Warrant issued by a Depository shall reference the serial number and name of the Producer of each bar. Each assay certificate issued by an Assayer shall certify that each bar of gold in the lot assays no less than 995 fineness and weight of each bar and the name of the Producer that produced each bar. Gold must be delivered to a Depository by a Carrier as follows: a. directly from a Producer; b. directly from an Assayer, provided that such gold is accompanied by an assay certificate of such Assayer; or c. directly from another Depository; provided, that such gold was placed in such other Depository pursuant to paragraphs (a) or (b) above.\"" }, { "docid": "46642", "title": "", "text": "I don't see any trading activity on rough rice options, so I'll just default to gold. The initial margin on a gold futures contract is $5,940. An option on a gold futures represents 1 contract. The price of an October gold futures call with a strike of $1310 is currently $22.70. Gold spot is currently $1308.20. The October gold futures price is $1307.40. So, yeah, you can buy 1 option to later control 1 futures for $22.70, but the moment you exercise you must have $5,940 in a margin account to actually use the futures contract. You could also sell the option. I don't know how much you're going to enjoy trading options on futures though -- the price of this option just last week ranged from $13.90 to $26, and last month it ranged from $15.40 to $46.90. There's some crazy leverage involved." }, { "docid": "506792", "title": "", "text": "Of course. But then, paper also has utility. So do seashells and pinecones. There is no obvious reason why, even in a perfect world, we would go looking for a malleable, highly-conductive, corrosion-resistant metal as something to peg the value of our banknotes to. The argument in favor of a gold standard is not whether gold is intrinsically more valuable than paper or seal skins or anything else, it's that gold is fairly inelastic in terms of supply, so it limits the ability of central bankers to mess up the value of the currency through interventionist funny business. If you picked up a rock and started going around telling people that we should use it as money because it's highly malleable and conductive and can be used in computer parts, they would look at you like you're a crazy person. That's not why gold is/was/should be a currency. Gold was indisputably the perfect currency for thousands of years, because it was easy to identify, easy to handle, hard to falsify, and rare. Those were important characteristics when strangers had to carry physical money to different places without any ATMs, credit-cards, or paypal accounts. They are somewhat less critical today, but still... The one characteristic that might *still* argue in favor of a gold standard is rarity: Since the amount of gold in the world is somewhat fixed, forcing the currency supply to be restricted to the gold supply semi-prevents governments and central bankers from getting into too much mischief (or at least, that's the theory). I will leave it to others to argue over whether a return to the gold standard would be a good idea, but the argument has nothing to with the intrinsic utility of gold. I'm sure we can all agree that gold is a fine metal with many good qualities." }, { "docid": "446972", "title": "", "text": "\"Most of the answers here reflect a misunderstanding of what gold actually is from a financial perspective. I'll answer your question by asking two questions, and I do challenge you to stop and think about what we mean when we say \"\"cash\"\" or \"\"unit of exchange\"\" because without understanding those, you will completely miss this answer. In 1971, the DXY was 110. For people who don't know, the DXY is the US Dollar Index - it weighs the strength of the US Dollar relative to other currencies. Hey look, it's a pretty graph of the DXY's history. In 1971, gold was $35 an ounce. The DXY is 97 today. Gold is $1170 an ounce today. Now the questions: If shares of Company A in 1971 were $10 a share, but now are $100 a share and some of this is because the company has grown, but some of it is because of inflation and the DXY losing value, what would the value of the company be if it was held in grams of gold and not dollars? Benjamin Graham, who influenced Warren Buffett, is a \"\"supposed\"\" critic of gold, yet what percent of his life were we not on a gold standard? In his day, the dollar was backed by gold - why would you buy gold if every dollar represented gold. Finally, consider how many US Dollars exist, and how few metric tonnes of gold exist (165,000). Even Paul Volcker admitted that a new gold standard would be impossible because the value of gold, if we did it today, would put gold in the $5000-$10000 range - which is absurd: To get on a gold standard technically now, an old fashioned gold standard, and you had to replace all the dollars out there in foreign hands with gold, God the price, you buy gold, because the price of gold would have to be enormous. So, you're all left hoping the Federal Reserve figures how to get us all out of this mess without causing trouble, otherwise, let me just kindly say, you WILL realize the value of gold then. As the old saying goes, \"\"A fool and his money are soon parted.\"\" I could be wrong, but I'd say that those who've been buying gold since 1971 for their \"\"cash holdings\"\" (not index funds) aren't the suckers.\"" }, { "docid": "421268", "title": "", "text": "The best advice I can give you is to ignore gold right now. You really don't and can't have all the information you would need to support an argument for shorting gold. How much fiat cash have the central banks injected into the word economy? Billions? Trillions? Tens of Trillions? Maybe not much at all as the banks repay overnight? Anyway.. Without going on a full on rant why would you touch gold on a short? I can understand speculating on long position based on all the news out there but I'd hesitate to be a contraian in this market. Just find a nice little company that makes money, has a good product and a pretty little balance sheet. It will take longer to research but fuck if I'm betting on a huge drop in gold any time soon. What reasons do you have to believe gold is headed for any significant slide?" }, { "docid": "212157", "title": "", "text": "Without getting into whether you should invest in Gold or Not ... 1.Where do I go and make this purchase. I would like to get the best possible price. If you are talking about Physical Gold then Banks, Leading Jewelry store in your city. Other options are buying Gold Mutual Fund or ETF from leading fund houses. 2.How do I assure myself of quality. Is there some certificate of quality/purity? This is mostly on trust. Generally Banks and leading Jewelry stores will not sell of inferior purity. There are certain branded stores that give you certificate of authenticity 3.When I do choose to sell this commodity, when and where will I get the best cost? If you are talking about selling physical gold, Jewelry store is the only place. Banks do not buy back the gold they sold you. Jewelry stores will buy back any gold, however note there is a buy price and sell price. So if you buy 10 g and sell it back immediately you will not get the same price. If you have purchased Mutual Funds / ETF you can sell in the market." }, { "docid": "217438", "title": "", "text": "\"I can describe the method for determining a price floor, which may help. It starts with looking at the cost of mining. There's a ridiculously small amount of gold in the best ore, so it's measured in tonnes of ore to produce a given ounce of gold. Mines will only operate at a loss for so long, so for any mine which focuses on gold, when the price of gold is below that price for long enough, the mine will cease operation. Since not all mines have the same cost, the supply will not appear as a step function, it will reduce slowly as mines close. \"\"Gold Drops Below Cash Cost, Approaches Marginal Production Costs\"\" offers a marginal cost of production just over $1100. This is not a floor price, as the market can act irrationally at times. It's just a number to consider. On the demand side, the industrial use (I am thinking gold plating in electronics manufacturing) will serve to provide demand almost regardless of price. When a $100 microprocessor uses say 10 cents worth of gold (at $300/oz) $1500 gold increases the final chip price by 1/2%. The industry is still trying to move away from Gold where they can, but that's a long process. As far as a ceiling goes, I highly recommend the book Extraordinary Popular Delusions & the Madness of Crowds which offers insight on a number of mania that have occurred not just in the past few decades, but over the centuries. At $1500/oz, the value of all the gold in the world is about US$7.5trillion (That's 12 zeros). Given that a portion of it is in jewelry and not available as an investment, it's safe to say that the entire world can only easily bid on about 1/3 of this (as the gold council cites 31% of gold going towards investments each year vs 57% jewelry and 11% industrial) or US$2.5T or so. With total world wealth at US$125T it would take a bit more hysteria to push gold from its current 2% of that value (funny how that number lined up perfectly) to much higher. Note: I provided a number of links, as it's too easy to just throw numbers around. See the links and provide more current data if you're so inclined. Data isn't real time.\"" }, { "docid": "112374", "title": "", "text": "\"You're circling around the answer... The only real difference between a loddar and a privately-issued promissory note is that the loddar is issued by a recognized third party with better credit/credibility (the whole merchant/priest/farmer cartel-thing). Private entities absolutely can and do issue their own promises to pay, and accept them, and in turn rely on those promises to make other promises. It's what you do when you charge something to a credit-card on the basis of your employer's promise to pay. You charge new tires, the tire store promises to pay its employees based on your CC company's promise to pay the tire-store, which is based on your promise to pay the credit-card company, which is based on your employer's promise to pay you, which is based on your employer's contracts with its customers, and so on... In fact, often as not, the whole chain *never actually gets reconciled with printed cash.* The central bank never has to print or even know about these transactions. It's just checks and electronic transfers: promises all the way down, maybe with occasional cash withdrawals for popcorn at the movies or to tip the stripper or something... That doesn't mean it's not \"\"real money\"\", it absolutely is: those promises are buying groceries and tires and making mortgage-payments and paying dentist bills and getting people to dig up stuff out of mines that will be fashioned into iPads, and all kinds of stuff. Where this hurts most people in the brain is that they kind of accept dollar bills as axiomatically and intrinsically valuable. So trying to explain in reverse how they are the same as promissory notes or credit-certificates is like trying to convince them that a plane ticket is the same as an airplane (which is obviously not true). That's why I started with this imaginary world without money. If you let go of any preconceptions, and stop trying to think through the analogies and don't read it trying to predictively look for the outcome conclusions, if you just read it and follow the story through, it is obvious that the *only* intrinsic difference (in that imaginary world) between apple-certificates, loddars, and privately-issued IOUs is the *credibility of the issuer*. Trying to understand this stuff via analogy will make your head spin: Taking it all the way back to the thread-topic and the question at the top of the page, what makes it so difficult is the tendency and mental impulse to analogize money as a \"\"thing\"\" that \"\"is\"\" somewhere, and therefore has to \"\"go\"\" somewhere. But that's an intrinsically and substantially imperfect analogy, which is what makes it hard to explain to a five-year-old. And you can't make the reality fit that analogy and stay sane. Even if you refuse to accept all this maddening abstraction and insist on only doing transactions with physical cash, or gold pieces, *the value of those markers is still 100% contingent on everyone accepting that everyone else will continue to believe that everyone else will continue to accept that currency...* Money is essentially a promise that other people will keep. Instead of giving you food, your employer gives you a \"\"universal gift certificate\"\" that you can redeem anywhere, and everyone else will accept it, because they can in turn redeem it anywhere else. The only difference between using a bank-draft or printed dollar bill, versus writing a promise to make good yourself, is the credibility of the issuer. That's a really difficult premise for most people to accept, because it's invisible and abstract, and seems to conflict with tangible interactions you've been doing all your life. So we have this sort of tendency to try and force the reality to fit preconceived conceptual analogies, like someone who keeps rejecting explanations of how airplanes can fly because \"\"that still doesn't explain how metal can be lighter than air\"\"... it's demanding that the reality must fit a hypothesis that doesn't apply. Hope that helps.\"" }, { "docid": "550440", "title": "", "text": "This is an excellent question; kudos for asking it. How much a person pays over spot with gold can be negotiated in person at a coin shop or in an individual transaction, though many shops will refuse to negotiate. You have to be a clever and tough negotiator to make this work and you won't have any success online. However, in researching your question, I dug for some information on one gold ETF OUNZ - which is physically backed by gold that you can redeem. It appears that you only pay the spot price if you redeem your shares for physical gold: But aren't those fees exorbitant? After all, redeeming for 50 ounces of Gold Eagles would result in a $3,000 fee on a $65,000 transaction. That's 4.6 percent! Actually, the fee simply reflects the convenience premium that gold coins command in the market. Here are the exchange fees compared with the premiums over spot charged by two major online gold retailers: Investors do pay an annual expense ratio, but the trade-off is that as an investor, you don't have to worry about a thief breaking in and stealing your gold." }, { "docid": "196596", "title": "", "text": "\"The benefit of having gold to trade is that there is almost always someone that will take gold when the fiat currency is in trouble. The potential downfall of doing this is that when people think the fiat currency is in trouble, they tend to buy up gold, thus driving up the price. This means that you get less gold for each hour of work you perform (deer-haunch, basket of apples, etc.). Even more, if the financial crisis is limited to only one fiat currency, you have a situation where that fiat currency devalues but others can gain in value as people try to sell their old currency for the new standard currency. If people also sell their gold to buy up this currency, that lowers the price of gold in that currency. For example, let us assume that gold was 1000 dollars an ounce and 1000 euros an ounce. Suddenly, people start thinking that the euro is in trouble, so they start buying gold. The law of supply and demand kicks in (more buyers, same supply, so higher prices) and gold is suddenly worth 2000 dollars and 2000 euros an ounce. If you start buying at this point, you get half as much gold as the person who bought in the beginning. Suddenly, the euro collapses. Stores that used to take euros start demanding dollars. Suddenly, it costs 20,000 euros for an ounce of gold but an ounce of gold will only get you 1,000 dollars since everyone is selling their gold to get dollars. The people who buy gold in the \"\"panic\"\" end up losing half the value of their money if not more. The \"\"speculators\"\" that bought gold at $1,000, sold it at $2,000, and bought it back at $1,000 now have all their gold back plus the $1,000 the other people lost.\"" } ]

[ { "docid": "110387", "title": "", "text": "\"Yes. \"\"There is, ...no Federal statute mandating that a private business, a person or an organization must accept currency or coins as for payment for goods and/or services.\"\" Taken from the US Department of the Treasury.\"" } ]

[ { "docid": "221795", "title": "", "text": "There are several problems with your reasoning: if I buy one share of GOOGLE now for $830, I could have $860 within the end of tonight -- totally possible and maybe even likely. You can do the same thing with 1,000,000 shares of google, and it's just as likely to go down as go up. if I were to invest $1,000.00 in gold to have $1,000.00 worth of gold, it's no different than keeping $1,000.00 in cash It's VERY different. Gold can be just as volatile as stocks, so it certainly is different as just keeping it in cash. Benefits of a larger portfolio:" }, { "docid": "239509", "title": "", "text": "\"It's not clear that anything needs to go up if gold goes down. In a bubble, asset prices can just collapse, without some other asset increasing to compensate. Economies are not a zero-sum game. On the other hand, gold may fall when people decide they don't need to hoard some store of value that, to their minds, never changes. It could very well indicate that there is more confidence in the broader economy. I am not a gold bug, so I don't much see the point in \"\"investing\"\" in something that is non-productive and also inedible, but to each his own.\"" }, { "docid": "491523", "title": "", "text": "\"In the US, this was the case during the 19th century. There was a system of \"\"subscriptions\"\" between banks, where larger banks backed the smaller banks to some extent. In trade, notes from distant banks were not accepted or discounted relative to known local banks, or silver/gold coinage. There were a number of problems with this system which came to a head during the Panic of 1907. During this crisis, a cascading series of banking failures was only stopped by the personal intervention of JP Morgan. Even when Morgan intervened, it was very difficult to make capital available in a way that avoided the panic. The subsequent creation of the Federal Reserve was a response to that crisis.\"" }, { "docid": "137444", "title": "", "text": "\"Why does the value of gold go up when gold itself doesn't produce anything? Why do people invest in gold? Your perception, that the value of gold goes up in the long run, is based on the price of gold measured in your favorite paper currency, for example the US Dollar. An increasing price of gold means that in the visible gold market, market participants are willing to exchange more paper currency units for the same amount of gold. There are many possible reasons for this: While HFT became extremely important for the short term price movements, I will continue with long term effects, excluding HFT. So when - as a simple thought experiment - the amount of available paper currency units (US $ or whatever) doubles, and the amount of goods and services in an economy stay the same, you can expect that the price of everything in this economy will double, including gold. You might perceive that the value of gold doubled. It did not. It stayed the same. The number of printed dollars doubled. The value of gold is still the same, its price doubled. Does the amount of paper currency units grow over time? Yes: https://research.stlouisfed.org/fred2/series/BASE/ In this answer my term \"\"paper currency units\"\" includes dollars that exist only as digits in bank accounts and \"\"printing currency\"\" includes creating those digits in bank accounts out of thin air. So the first answer: gold holds its value while the value of paper currency units shrinks over time. So gold enables you to pass wealth to the next generation (while hiding it from your government). That gold does not produce anything is not entirely true. For those of us mortals who have only a few ounces, it is true. But those who have tons can lease it out and earn interest. (in practice it is leased out multiple times, so multiple that gain. You might call this fraud, and rightfully so. But we are talking about tons of gold. Nobody who controls tons of physical gold goes to jail yet). Let's talk about Fear. You see, the perceived value of gold increases as more paper currency is printed. And markets price in expected future developments. So the value of gold rises, if a sufficient number of wealthy people fear the the government(s) will print too much paper currency. Second Answer: So the price of gold not only reflects the amount of paper currency, it is also a measurement of distrust in government(s). Now you might say something is wrong with my argument. The chart mentioned above shows that we have now (mid 2015) 5 times as much printed currency units than we had 2008. So the price of gold should be 5 times as high as 2008, assuming the amount of distrust in governments stayed the same. There must be more effects (or I might be completely wrong. You decide). But here is one more effect: As the price of gold is a measurement of distrust in governments (and especially the US government since the US Dollar is perceived as the reserve currency), the US government and associated organizations are extremely interested in low gold prices to prove trust. So people familiar with the topic believe that the price of gold (and silver) is massively manipulated to the downside using high frequency trading and shorts in the futures markets by US government and wall street banks to disprove distrust. And wall street banks gain huge amounts of paper currency units by manipulating the price, mostly to the downside. Others say that countries like china and russia are also interested in low gold prices because they want to buy as much physical gold as possible. Knowing of the value that is not reflected by the price at the moment. Is there one more source of distrust in governments? Yes. Since 1971, all paper currencies are debt. They receive their value by the trust that those with debt are willing and able to pay back their debt. If this trust is lost, the downward manipulation (if you think that such a thing exists) of the gold and silver prices in the futures markets might fail some day. If this is the case (some say when this is the case). you might see movements in gold and silver prices that bring them back to equilibrium with the amount of printed paper currencies. In times of the roman empire you got a good toga and a pair of handmade shoes for an ounce of gold. In our days, you get a nice suite and a good pair of shoes for an ounce of gold. In the mean time, the value of each paper currency in the history of each country went to zero and the US $ lost 98% of its initial value. As long as there is not enough distrust, more paper currency is made in equity markets and bond markets on average. (Be aware that you earn that currency only after you were able to sell at this price, not while you hold it) Gerd\"" }, { "docid": "440882", "title": "", "text": "\"Easiest thing ever. In fact, 99% of people are loosing money. If you perform worse then 10% annually in cash (average over 5-10 years), then you better never even think about trading/investing. Most people are sitting at 0%..-5% annually. They win some, loose some, and are being outrun by inflation and commissions. In fact, fall of market is not a big deal, stock indexes are often jump back in a few months. If you rebalance properly, it is mitigated. Your much bigger enemy is inflation. If you think inflation is small, look at gold price over past 20 years. Some people, Winners at first, grow to +10%, get too relaxed and start to grow already lost position. That one loose trade eats 10% of their portfolio. Only there that people realize they should cut it off, when they already lost their profits. And they start again with +0%. This is hard thing to accept, but most of people are not made for that type of business. Even worse, they think \"\"if I had bigger budget, I would perform better\"\", which is kind of self-lie.\"" }, { "docid": "352485", "title": "", "text": "The answer is that other than a small number of applications (the approx. 10% of gold production that goes to 'industrial uses') gold does not have intrinsic value beyond being pretty and rare (and useful for making jewelry.) There are a number of 'industrial' applications and uses for gold (see other answers for a list) but the volume consumed this way is fairly small, especially relative to the capacity to mine new gold and reclaim existing gold. If you removed investment, and jewelry usage (especially culturally driven jewelry usage) then there's no way the remaining uses for industry and dentistry could sustain the price levels we currently see for gold. Furthermore, and perhaps more importantly, the best data I can find for this shows the total number of tons consumed for industrial uses has been shrinking for several years now, and that was prior to recent price increases, so it is difficult to tie that reduced demand to increasing prices. And one might postulate in a 'collapsed society' you seem to be referring to in your question, that a lot of the recent industrial demand (e.g. the '50 cents of gold in each cellphone') could quite possibly disappear entirely. The argument many people use for gold having value is usually 'been used as money for thousands of years'. But this confuses gold having a value of its own with the reasons why something makes a useful currency. Gold has a large number of characteristics that make it an ideal currency, and of all the elements available it is perhaps the best physical element to serve as a currency. BUT just as with a dollar bill, just because it is a good currency, does NOT give it an intrinsic value. Any currency is only worth what someone will trade you for it. The value is set by the economy etc., not the medium used as a currency. So yes, people will probably always use gold as money, but that doesn't make the money worth anything, it's just a medium of exchange. Incidentally two other things should be noted. The first is that you have a problem when the medium itself used for a currency becomes worth more than the face value. Hence why we stopped using silver in coins, and there were concerns over pennies due to the price of copper. This leads to the second point, which is that currently, gold is TOO RARE to suffice as a world currency, hence why all countries went off the gold standard years ago. The size of national and global economies was growing faster than the supply of gold, and hence it was becoming impossible to have enough gold to back all the currencies (inflation concerns aside)." }, { "docid": "346735", "title": "", "text": "\"First of all, setting some basics: What is a sound way to measure the risk of each investment in order to compare them with each other ? There is no single way that can be used across all asset classes / risks. Generally speaking, you want to perform both a quantitative and qualitative assessment of risks that you identify. Quantitative risk assessment may involve historical data and/or parametric or non-parametric models. Using historical data is often simple but may be hard in cases where the amount of data you have on a given event is low (e.g. risk of bust by investing in a cryptocurrency). Parametric and non-parametric risk quantification models exist (e.g. Value at Risk (VaR), Expected Shortfall (ES), etc) and abound but a lot of them are more complicated than necessary for an individual's requirements. Qualitative risk assessment is \"\"simply\"\" assessing the likelihood and severity of risks by using intuition, expert judgment (where that applies), etc. One may consult with outside parties (e.g. lawyers, accountants, bankers, etc) where their advisory may help highlighting some risks or understanding them better. To ease comparing investment opportunities, you may want to perform a risk assessment on categories of risks (e.g. investing in the stock market vs bond market). To compare between those categories, one should look at the whole picture (quantitative and qualitative) with their risk appetite in mind. Of course, after taking those macro decisions, you would need to further assess risks on more micro decisions (e.g. Microsoft or Google ?). You would then most likely end up with better comparatives as you would be comparing items similar in nature. Should I always consider the worst case scenario ? Because when I do that, I always can lose everything. Generally speaking, you want to consider everything so that you can perform a risk assessment and decide on your risk mitigating strategy (see Q4). By assessing the likelihood and severity of risks you may find that even in cases where you are comparatively as worse-off (e.g. in case of complete bust), the likelihood may differ. For example, keeping gold in a personal stash at home vs your employer going bankrupt if you are working for a large firm. Do note that you want to compare risks (both likelihood and severity) after any risk mitigation strategy you may want to put in place (e.g. maybe putting your gold in a safety box in a secure bank would make the likelihood of losing your gold essentially null). Is there a way to estimate the probability of such events, better than intuition ? Estimating probability or likelihood is largely dependent on data on hand and your capacity to model events. For most practical purposes of an individual, modelling would be way off in terms of reward-benefits. You may therefore want to simply research on past events and assign them a 1-5 (1 being very low, 5 being very high) risk rating based on your assessment of the likelihood. For example, you may assign a 1 on your employer going bankrupt and a 2 or 3 on being burglarized. This is only slightly better than intuition but has the merit of being based on data (e.g. frequency of burglary in your neighborhood). Should I only consider more probable outcomes and have a plan for them if they occur? This depends largely on your risk appetite. The more risk averse you are, the more thorough you will want to be in identifying, tracking and mitigating risks. For the risks that you have identified as relevant, or of concern, you may opt to establish a risk mitigating strategy, which is conventionally one of accepting, sharing (by taking insurance, for example), avoiding and reducing. It may not be possible to share or reduce some risks, especially for individuals, and so often the response will be either to accept or avoid the given risks by opting in or out on an opportunity.\"" }, { "docid": "217438", "title": "", "text": "\"I can describe the method for determining a price floor, which may help. It starts with looking at the cost of mining. There's a ridiculously small amount of gold in the best ore, so it's measured in tonnes of ore to produce a given ounce of gold. Mines will only operate at a loss for so long, so for any mine which focuses on gold, when the price of gold is below that price for long enough, the mine will cease operation. Since not all mines have the same cost, the supply will not appear as a step function, it will reduce slowly as mines close. \"\"Gold Drops Below Cash Cost, Approaches Marginal Production Costs\"\" offers a marginal cost of production just over $1100. This is not a floor price, as the market can act irrationally at times. It's just a number to consider. On the demand side, the industrial use (I am thinking gold plating in electronics manufacturing) will serve to provide demand almost regardless of price. When a $100 microprocessor uses say 10 cents worth of gold (at $300/oz) $1500 gold increases the final chip price by 1/2%. The industry is still trying to move away from Gold where they can, but that's a long process. As far as a ceiling goes, I highly recommend the book Extraordinary Popular Delusions & the Madness of Crowds which offers insight on a number of mania that have occurred not just in the past few decades, but over the centuries. At $1500/oz, the value of all the gold in the world is about US$7.5trillion (That's 12 zeros). Given that a portion of it is in jewelry and not available as an investment, it's safe to say that the entire world can only easily bid on about 1/3 of this (as the gold council cites 31% of gold going towards investments each year vs 57% jewelry and 11% industrial) or US$2.5T or so. With total world wealth at US$125T it would take a bit more hysteria to push gold from its current 2% of that value (funny how that number lined up perfectly) to much higher. Note: I provided a number of links, as it's too easy to just throw numbers around. See the links and provide more current data if you're so inclined. Data isn't real time.\"" }, { "docid": "550440", "title": "", "text": "This is an excellent question; kudos for asking it. How much a person pays over spot with gold can be negotiated in person at a coin shop or in an individual transaction, though many shops will refuse to negotiate. You have to be a clever and tough negotiator to make this work and you won't have any success online. However, in researching your question, I dug for some information on one gold ETF OUNZ - which is physically backed by gold that you can redeem. It appears that you only pay the spot price if you redeem your shares for physical gold: But aren't those fees exorbitant? After all, redeeming for 50 ounces of Gold Eagles would result in a $3,000 fee on a $65,000 transaction. That's 4.6 percent! Actually, the fee simply reflects the convenience premium that gold coins command in the market. Here are the exchange fees compared with the premiums over spot charged by two major online gold retailers: Investors do pay an annual expense ratio, but the trade-off is that as an investor, you don't have to worry about a thief breaking in and stealing your gold." }, { "docid": "474129", "title": "", "text": "\"There's a few layers to the Momentum Theory discussed in that book. But speaking in general terms I can answer the following: Kind of. Assuming you understand that historically the Nasdaq has seen a little more volatility than the S&P. And, more importantly, that it tends to track the tech sector more than the general economy. Thus the pitfall is that it is heavily weighted towards (and often tracks) the performance of a few stocks including: Apple, Google (Alphabet), Microsoft, Amazon, Intel and Amgen. It could be argued this is counter intuitive to the general strategy you are trying to employ. This could be tougher to justify. The reason it is potentially not a great idea has less to do with the fact that gold has factors other than just risk on/off and inflation that affect its price (even though it does!); but more to do with the fact that it is harder to own gold and move in and out of positions efficiently than it is a bond index fund. For example, consider buying physical gold. To do so you have to spend some time evaluating the purchase, you are usually paying a slight premium above the spot price to purchase it, and you should usually also have some form of security or insurance for it. So, it has additional costs. Possibly worth it as part of a long-term investment strategy; if you believe gold will appreciate over a decade. But not so much if you are holding it for as little as a few weeks and constantly moving in and out of the position over the year. The same is true to some extent of investing in gold in the form of an ETF. At least a portion of \"\"their gold\"\" comes from paper or futures contracts which must be rolled every month. This creates a slight inefficiency. While possibly not a deal breaker, it would not be as attractive to someone trading on momentum versus fundamentals in my opinion. In the end though, I think all strategies are adaptable. And if you feel gold will be the big mover this year, and want to use it as your risk hedge, who am I or anyone else to tell you that you shouldn't.\"" }, { "docid": "112374", "title": "", "text": "\"You're circling around the answer... The only real difference between a loddar and a privately-issued promissory note is that the loddar is issued by a recognized third party with better credit/credibility (the whole merchant/priest/farmer cartel-thing). Private entities absolutely can and do issue their own promises to pay, and accept them, and in turn rely on those promises to make other promises. It's what you do when you charge something to a credit-card on the basis of your employer's promise to pay. You charge new tires, the tire store promises to pay its employees based on your CC company's promise to pay the tire-store, which is based on your promise to pay the credit-card company, which is based on your employer's promise to pay you, which is based on your employer's contracts with its customers, and so on... In fact, often as not, the whole chain *never actually gets reconciled with printed cash.* The central bank never has to print or even know about these transactions. It's just checks and electronic transfers: promises all the way down, maybe with occasional cash withdrawals for popcorn at the movies or to tip the stripper or something... That doesn't mean it's not \"\"real money\"\", it absolutely is: those promises are buying groceries and tires and making mortgage-payments and paying dentist bills and getting people to dig up stuff out of mines that will be fashioned into iPads, and all kinds of stuff. Where this hurts most people in the brain is that they kind of accept dollar bills as axiomatically and intrinsically valuable. So trying to explain in reverse how they are the same as promissory notes or credit-certificates is like trying to convince them that a plane ticket is the same as an airplane (which is obviously not true). That's why I started with this imaginary world without money. If you let go of any preconceptions, and stop trying to think through the analogies and don't read it trying to predictively look for the outcome conclusions, if you just read it and follow the story through, it is obvious that the *only* intrinsic difference (in that imaginary world) between apple-certificates, loddars, and privately-issued IOUs is the *credibility of the issuer*. Trying to understand this stuff via analogy will make your head spin: Taking it all the way back to the thread-topic and the question at the top of the page, what makes it so difficult is the tendency and mental impulse to analogize money as a \"\"thing\"\" that \"\"is\"\" somewhere, and therefore has to \"\"go\"\" somewhere. But that's an intrinsically and substantially imperfect analogy, which is what makes it hard to explain to a five-year-old. And you can't make the reality fit that analogy and stay sane. Even if you refuse to accept all this maddening abstraction and insist on only doing transactions with physical cash, or gold pieces, *the value of those markers is still 100% contingent on everyone accepting that everyone else will continue to believe that everyone else will continue to accept that currency...* Money is essentially a promise that other people will keep. Instead of giving you food, your employer gives you a \"\"universal gift certificate\"\" that you can redeem anywhere, and everyone else will accept it, because they can in turn redeem it anywhere else. The only difference between using a bank-draft or printed dollar bill, versus writing a promise to make good yourself, is the credibility of the issuer. That's a really difficult premise for most people to accept, because it's invisible and abstract, and seems to conflict with tangible interactions you've been doing all your life. So we have this sort of tendency to try and force the reality to fit preconceived conceptual analogies, like someone who keeps rejecting explanations of how airplanes can fly because \"\"that still doesn't explain how metal can be lighter than air\"\"... it's demanding that the reality must fit a hypothesis that doesn't apply. Hope that helps.\"" }, { "docid": "565782", "title": "", "text": "Another answer to this question occurred to me as I started learning more about historical uses for gold etc. Perhaps it's a crackpot idea, but I'm going to float it anyway to see what you folks think. Investing in Gold is an indirect investment in the Economy and GDP of the nation of India. To that extent is it only a hedge against inflation, so long as the indian economy grows at a more rapid rate than your local inflation rate. Fact, India currently consumes more than 1/3 of gold production, predominantly in the form of Jewelry. And their demand has been growing rapidly, up 69% just between 2009 and 2010 alone. I can't find too many historial consumption numbers for India, but when you look at past articles on this subject, you see phrases like 'one forth' and '20%' being used only a few years go to describe India's consumption levels. Fact, India has virtually no domestic sources of gold. India’s handful of gold mines produce about 2.5 tonnes of the metal each year, a fraction of the country’s annual consumption of about 800 tonnes. Fact. Indian Culture places high value on gold as a visible demonstration of wealth. Particularly in situations such In Indian weddings where the bride brings in gold to show her family's status and wealth and it forms part of the dowry given to bride. It is believed that a bride wearing 24k gold on their wedding to bring luck and happiness throughout the married life. Fact, the recent trends in outsourcing, Indian citizens working abroad sending money home, etc have all lead to a influx of foreign cash to the Indian economy and explosive GDP growth. See the following chart and compare the period of 2000-current with a chart showing the price of gold in other answer here. Notice how the curves parallel each other to a large degree Potentially unfounded conclusion drawn from above numbers. The rapid growth of the Indian economy, coupled with a rich cultural tradition that values gold as a symbol of wealth, along with a sudden rise in 'wealthy' people due to the economy and influx of foreign cash, has resulted in skyrocketing demand for gold from India, and this large 'consumption' demand is the most likely explanation for the sudden rise in the price of gold over the last several years. Investors then jump on the 'rising price bandwagon' as especially does anyone that can make a profit from selling gold to those seeking to get on said bandwagon. As such, as long as indian cultural tradition remains unchanged, and their economy remains strong, the resulting increasing demand for gold will sustain current and perhaps increased prices. Should there be any sudden collapse in the Indian GDP, gold will likely tumble in parallel. disclaimer: not an expert, just observations based off the data I've seen, there may be other parts to the picture of 'gold demand' that I've not considered." }, { "docid": "180404", "title": "", "text": "\"Intrinsic value is a myth. There is no such thing. Subjective human demand is the only thing that gives anything value. This subjectivity is different person to person and can change very quickly. Historically there are two main uses for gold: jewelry and money. How can you tell when a particular type of money is undervalued? It disappears from circulation since people prefer to use money that is overvalued. This phenomenon is paraphrased in Gresham's Law: Bad money drives out good money. The Coinage Act of 1792 established the US dollar as 371.25 grains of silver or 24.75 grains of gold. This established a government ratio of 15 ounces of silver to 1 ounce of gold. In the late 18th century there was a large production of silver from Mexico and the market ratio of silver to gold increased to 15.75 to 1 by 1805. The government ratio, however, was still 15 to 1. This was enough incentive for people to exchange their silver coins for gold coins at the government ratio, melt the gold, and sell the gold bullion overseas at the market value. Thus, gold coins disappeared from circulation as people either hoarded the gold or sent it abroad. People used the overvalued silver coins (i.e. the \"\"bad\"\" money) domestically and gold coins disappeared from the market. In an attempt to correct the problem of disappearing gold coins the Coinage Act of 1834 was enacted. It kept the US dollar at 371.25 grains of silver but changed the definition to 23.2 grains of gold which established a government ratio of 16 to 1. This was close to the market ratio of gold to silver at the time so both gold and silver coins appeared in circulation again. The gold rush of 1849 produced a lot of gold and the market ratio of silver to gold became 15.46 to 1. Now gold was overvalued so people began exchanging their gold coins for silver coins at the government ratio, melt the silver, and sell the silver bullion overseas at the market value. People used the overvalued gold coins (i.e. the \"\"bad\"\" money) domestically and silver coins disappeared from the market. When you see gold circulating everywhere you will know it is overvalued compared to other types of money. Paper money always drives gold out of circulation since the market ratio of paper to gold severely under values gold. Source here.\"" }, { "docid": "272547", "title": "", "text": "\"Ok, I think what you're really asking is \"\"how can I benefit from a collapse in the price of gold?\"\" :-) And that's easy. (The hard part's making that kind of call with money on the line...) The ETF GLD is entirely physical gold sitting in a bank vault. In New York, I believe. You could simply sell it short. Alternatively, you could buy a put option on it. Even more risky, you could sell a (naked) call option on it. i.e. you receive the option premium up front, and if it expires worthless you keep the money. Of course, if gold goes up, you're on the hook. (Don't do this.) (the \"\"Don't do this\"\" was added by Chris W. Rea. I agree that selling naked options is best avoided, but I'm not going to tell you what to do. What I should have done was make clear that your potential losses are unlimited when selling naked calls. For example, if you sold a single GLD naked call, and gold went to shoot to $1,000,000/oz, you'd be on the hook for around $10,000,000. An unrealistic example, perhaps, but one that's worth pondering to grasp the risk you'd be exposing yourself to with selling naked calls. -- Patches) Alternative ETFs that work the same, holding physical gold, are IAU and SGOL. With those the gold is stored in London and Switzerland, respectively, if I remember right. Gold peaked around $1900 and is now back down to the $1500s. So, is the run over, and it's all downhill from here? Or is it a simple retracement, gathering strength to push past $2000? I have no idea. And I make no recommendations.\"" }, { "docid": "156672", "title": "", "text": "From Wikipedia: Investment has different meanings in finance and economics. In Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time. In contrast putting money into something with an expectation of gain without thorough analysis, without security of principal, and without security of return is speculation or gambling. The second part of the question can be addressed by analyzing the change in gold price vs inflation year by year over the long term. As Chuck mentioned, there are periods in which it didn't exceed inflation. More important, over any sufficiently long length of time the US stock market will outperform. Those who bought at the '87 peak aren't doing too bad, yet those who bought in the last gold bubble haven't kept up with inflation. $850 put into gold at the '80 top would inflate today to $2220 per the inflation calculator. You can find with a bit of charting some periods where gold outpaced inflation, and some where it missed. Back to the definition of investment. I think gold fits speculation far better than it does investment. I've heard the word used in ways I'd disagree with, spend what you will on the shoes, but no, they aren't an investment, I tell my wife. The treadmill purchase may improve my health, and people may use the word colloquially, but it's not an investment." }, { "docid": "566458", "title": "", "text": "What is the best way that I can invest money so that I can always get returns? If you want something that doesn't require any work on your end, consider having a fee-only financial planner make a plan so that your investments can be automated to generate a cash flow for you or get an annuity as the other classic choices here as most other choices will require some time commitment in one form or other. Note that for stock investments there could be rare instances like what happened for a week in September in 2001 where the markets were closed for 5 days straight that can be the hiccup in having stocks. Bonds can carry a risk of default where there have been municipalities that defaulted on debt as well as federal governments like Russia in the 1990s. Real estate may be subject to natural disasters or other market forces that may prevent there always being a monthly payment coming as if you own a rental property then what happens if there aren't tenants because there was an evacuation of the area? There may be some insurance products to cover some of these cases though what if there are exceptionally high claims all at once that may have an insurance company go under? Would it be to set up an FD in a bank, to buy land, to buy a rental house, to buy a field, or maybe to purchase gold? What investment of your own time do you plan on making here? Both in terms of understanding what your long-term strategy is and then the maintenance of the plan. If you put the money in the bank, are you expecting that the interest rate will always be high enough to give you sufficient cash to live as well as having no financial crisis with the bank or currency you are using? Are there any better investments? You may want to reconsider what assumptions you want to make and what risks you want to accept as there isn't likely to be a single solution here that would be perfect." }, { "docid": "35875", "title": "", "text": "\"As mentioned in other answers, you find out by reading the Rulebook for that commodity and exchange. I'll quote a couple of random passages to show how they vary: For CME (Chicago Mercantile Exchange) Random Length Lumber Futures, the delivery is ornate: Seller shall give his Notice of Intent to Deliver to the Clearing House prior to 12:00 noon (on any Business Day after termination of trading in the contract month. 20103.D. Seller's Duties If the buyer's designated destination is east of the western boundaries of North Dakota, South Dakota, Nebraska, Kansas, Texas and Oklahoma, and the western boundary of Manitoba, Canada, the seller shall follow the buyer's shipping instructions within seven (7) Business Days after receipt of such instructions. In addition, the seller shall prepay the actual freight charges and bill the buyer, through the Clearing House, the lowest published freight rate for 73-foot railcars from Prince George, British Columbia to the buyer's destination. If the lowest published freight rate from Prince George, British Columbia to buyer's destination is a rate per one hundred pounds, the seller shall bill the buyer on the weight basis of 1,650 pounds per thousand board feet. The term \"\"lowest published freight rate\"\" refers only to the lowest published \"\"general through rate\"\" and not to rates published in any other rate class. If, however, the buyer’s destination is outside of the aforementioned area, the seller shall follow the same procedures except that the seller shall have the right to change the point of origin and/or originating carrier within 2 Business Days after receipt of buyer’s original shipping instructions. If a change of origin and/or originating carrier is made, the seller shall then follow the buyer's revised instructions within seven (7) Business Days after receipt of such instructions. If the freight rate to the buyer's destination is not published, the freight charge shall be negotiated between the buyer and seller in accordance with industry practice. Any additional freight charges resulting from diversion by the buyer in excess of the actual charges for shipment to the destination specified in the shipping instructions submitted to the Clearing House are the responsibility of the buyer. Any reduction in freight charges that may result from a diversion is not subject to billing adjustment through the Clearing House. Any applicable surcharges noted by the rail carrier shall be considered as part of the freight rate and can be billed to the buyer through the CME Clearing House. If within two (2) Business Days of the receipt of the Notice of Intent the buyer has not designated a destination, or if during that time the buyer and seller fail to agree on a negotiated freight charge, the seller shall treat the destination as Chicago, Illinois. If the buyer does not designate a carrier or routing, the seller shall select same according to normal trade practices. To complete delivery, the seller must deposit with the Clearing House a Delivery Notice, a uniform straight bill of lading (or a copy thereof) and written information specifying grade, a tally of pieces of each length, board feet by sizes and total board feet. The foregoing documents must be received by the Clearing House postmarked within fourteen (14) Business Days of the date of receipt of shipping instructions. In addition, within one (1) Business Day after acceptance by the railroad, the Clearing House must receive information (via a telephone call, facsimile or electronic transmission) from the seller giving the car number, piece count by length, unit size, total board footage and date of acceptance. The date of acceptance by the railroad is the date of the bill of lading, signed and/or stamped by the originating carrier, except when determined otherwise by the Clearing House. For some commodities you can't get physical delivery (for instance, Cheese futures won't deliver piles of cheese to your door, for reasons that may be obvious) 6003.A. Final Settlement There shall be no delivery of cheese in settlement of this contract. All contracts open as of the termination of trading shall be cash settled based upon the USDA monthly weighted average price in the U.S. for cheese. The reported USDA monthly weighted average price for cheese uses both 40 pound cheddar block and 500 pound barrel prices. CME gold futures will deliver to a licensed depository, so you would have to arrange for delivery from the depository (they'll issue you a warrant), assuming you really want a 100 troy oz. bar of gold: CONTRACT SPECIFICATIONS The contract for delivery on futures contracts shall be one hundred (100) troy ounces of gold with a weight tolerance of 5% either higher or lower. Gold delivered under this contract shall assay to a minimum of 995 fineness and must be a brand approved by the Exchange. Gold meeting all of the following specifications shall be deliverable in satisfaction of futures contract delivery obligations under this rule: Either one (1) 100 troy ounce bar, or three (3) one (1) kilo bars. Gold must consist of one or more of the Exchange’s Brand marks, as provided in Chapter 7, current at the date of the delivery of contract. Each bar of Eligible gold must have the weight, fineness, bar number, and brand mark clearly incised on the bar. The weight may be in troy ounces or grams. If the weight is in grams, it must be converted to troy ounces for documentation purposes by dividing the weight in grams by 31.1035 and rounding to the nearest one hundredth of a troy ounce. All documentation must illustrate the weight in troy ounces. Each Warrant issued by a Depository shall reference the serial number and name of the Producer of each bar. Each assay certificate issued by an Assayer shall certify that each bar of gold in the lot assays no less than 995 fineness and weight of each bar and the name of the Producer that produced each bar. Gold must be delivered to a Depository by a Carrier as follows: a. directly from a Producer; b. directly from an Assayer, provided that such gold is accompanied by an assay certificate of such Assayer; or c. directly from another Depository; provided, that such gold was placed in such other Depository pursuant to paragraphs (a) or (b) above.\"" }, { "docid": "172334", "title": "", "text": "I hope you all can forgive my ignorance of the topic. But what does it mean when you invest in gold? Do you actually own real gold somewhere? I don't know how it works so if someone can explain it to me I'd appreciate it. :) Again sorry for asking probably a stupid question lol." }, { "docid": "516596", "title": "", "text": "? The guy claimed that BTC had intrinsic value so I asked him what instrinsic value BTC had. BTC has literally 0 intrinsic value, it doesn't even exist physically. I'm not saying the technology is worthless or that it doesn't have value, but it certainly doesn't have intrinsic value. Gold--you can create things with gold, silver--silver is important in medical applications, can be made into things. These things have value, even in circumstances where the market disappears or the demand ceases. A company has intrinsic value in that its assets can be sold off and liquidated for cash--even if they don't generate a single penny. Gold has intrinsic value in that even if there is no one demanding gold, it can still be useful for something. If no one wants BTC, you literally can't do anything with it except look at the numbers. It's the equivalent of hoarding a pile of dust that the market valued for some reason and then the market crashes--what are you going to do with a pile of dust? Literally nothing except watch it fly in the wind. It was only worth something because other people valued it. Block chain is revolutionary tech, but there is no IV with BTC. BTC and block-chain aren't really even interchangeable--it's like the relationship between a square and a rectangle; a square is a rectangle but a rectangle is not necessarily a square. BTC is block chain but block chain isn't BTC. Even if BTC fails and dies, there will be something else that takes its place but there is no IV with BTC. Trying to assign BTC some sort of IV is a misleading. There are many reasons BTC is revolutionary but it's not because there is some sort of huge IV attached to it. And where did I ever call BTC a ponzi scheme? You sound like you got a chip on your shoulder." } ]

[ { "docid": "201183", "title": "", "text": "Yes. But the question is do you want to have gold? If you are going to buy gold anyway, and if you can get a good conversion rate between USD:gold, then why not? If you are looking to use your earnings on things that you cannot buy using gold, then I'd recommend you take USD instead. Have fun!" } ]

[ { "docid": "94471", "title": "", "text": "\"I'd agree with maybe a concept of \"\"situational value\"\" being negative while accepting \"\"intrinsic value\"\" means \"\"what use a person can expect to get out of it\"\", but again, both ultimately are subjective. That said, there can be benefits from drawing a distinction between the two. Going back to Bitcoin, it does have an \"\"intrinsic value\"\", because the value of Bitcoin itself is that it can be divided up easily, transferred easily, and etc, all the things that make a currency valuable. Traditionally, we value things as money if they meet many of the following criteria: 1. Medium of exchange 2. Unit of account 3. Store of value 4. Standard of deferred payment 5. Measure of Value Gold meets some of these better than others, dollars meet some of these better than others, and so on, but Bitcoin meets all of these very well, which means (at least to me) that Bitcoin has intrinsic value in that it meets the definition of what we value the most in a *currency*. So maybe as long as we agree that there is a difference between subjective value and intrinsic value, and agree that subjective value can, in fact, be negative, there may be something to go on here.\"" }, { "docid": "138892", "title": "", "text": "Mainly because I have it and you don't, I can make you do stuff for it because more of us perceive its value than bother about the paper you are holding. Picture if you will a moment in time, when the paper you are holding, represented the amount of gold you had at home, as time went by you spent all your gold and the amount the paper represented, became less and less and the amount of lunch you could buy with it became less and less. Today the day has arrived, that you have no gold left and what your paper represents is an empty coffer . . Move along . .people who can pay for their lunch are waiting and look, the paper they hold represents gold they have." }, { "docid": "240894", "title": "", "text": "\"Gold may have some \"\"intrinsic value\"\" but it cannot be accurately determined by investors by any known valuation techniques. In fact, if you were to apply the dividend discount model of John Burr Williams - a variation of which is the basis of Discounted Cash Flow (DCF) analysis and the basis of most valuation techniques - gold would have zero intrinsic value because it produces no cash flow. Legendary focus investor Warren Buffett argues that investing in gold is pure speculation because of the reason mentioned above. As others have mentioned, gold prices are affected by supply and demand, but the bigger influence on the price of gold is how the economy is. Gold is seen as a store of value because, according to some, it does not \"\"lose value\"\" unlike paper currency during inflation. In inflationary times, demand increases so gold prices do go up, which is why gold behaves similar to a commodity but has far less uses. It is difficult to argue whether or not gold gains or loses value because we can't determine the intrinsic value of gold, and anyone who attempts to justify any given price is pulling blinders over your eyes. It is indisputable that, over history, gold represents wealth and that in the past century and the last decade, gold prices rise in inflationary conditions as people dump dollars for gold, and it has fallen when the purchasing power of currency increases. Many investors have talked about a \"\"gold bubble\"\" by arguing that gold prices are inflated because of inflation and the Fed's money policy and that once interest rates rise, the money supply will contract and gold will fall, but again, nobody can say with any reasonable accuracy what the fair value of gold at any given point is. This article on seeking alpha: http://seekingalpha.com/article/112794-the-intrinsic-value-of-gold gives a quick overview, but it is also vague because gold can't be accurately priced. I wouldn't say that gold has zero intrinsic value because gold is not a business so traditional models are inappropriate, but I would say that gold *certainly * doesn't have a value of $1,500 and it's propped so high only because of investor expectation. In conclusion, I do not believe you can accurately state whether gold is undervalued or overvalued - you must make judgments based on what you think about the future of the market and of monetary policy, but there are too many variables to be accurate consistently.\"" }, { "docid": "337243", "title": "", "text": "\"Definitely look at CEF. They have tax advantages over GLD and SLV, and have been around for 50 years, and are a Canadian company. They hold their gold in 5 distributed vaults. Apparently tax advantage comes because with GLD, if you supposedly approach them with enough money, you can take out a \"\"bar of gold\"\". Just one problem (well, perhaps more): a bar of gold is an enormous sum of money (and as such not very liquid), and apparently gold bars have special certifications and tracking, which one would mess up if one took it to there personal collection, costing additional sums to re-certify. many, many articles on the web claiming that the gold GLD has is highly leveraged, is held by someone else, and tons of other things that makes GLD seem semi-dubious. I've used CEF for years, talked to them quite a few times; to me, and short of having it my possession, they seem the best /safest / easiest alternative, and are highly liquid/low spread betwen bid and ask. The do also have a pure gold \"\"stock\"\" and a pure silver \"\"stock\"\", but these often trade at higher premiums. CEF's premium varies between -2% and +4%. I.e. sometimes it trades at a premium to the gold and silver it holds, sometimes at a discount. Note that CEF generally shoots to have a 50/50 ratio of gold / silver holdings in their possession/vaults, but this ratio has increased to be heavier gold weighted than silver, as silver has not performed quite as well lately. You can go to their web-site and see exactly what they have, e.g. their NAV page: http://www.centralfund.com/Nav%20Form.htm\"" }, { "docid": "550440", "title": "", "text": "This is an excellent question; kudos for asking it. How much a person pays over spot with gold can be negotiated in person at a coin shop or in an individual transaction, though many shops will refuse to negotiate. You have to be a clever and tough negotiator to make this work and you won't have any success online. However, in researching your question, I dug for some information on one gold ETF OUNZ - which is physically backed by gold that you can redeem. It appears that you only pay the spot price if you redeem your shares for physical gold: But aren't those fees exorbitant? After all, redeeming for 50 ounces of Gold Eagles would result in a $3,000 fee on a $65,000 transaction. That's 4.6 percent! Actually, the fee simply reflects the convenience premium that gold coins command in the market. Here are the exchange fees compared with the premiums over spot charged by two major online gold retailers: Investors do pay an annual expense ratio, but the trade-off is that as an investor, you don't have to worry about a thief breaking in and stealing your gold." }, { "docid": "371390", "title": "", "text": "My personal gold/metals target is 5.0% of my retirement portfolio. Right now I'm underweight because of the run up in gold/metals prices. (I haven't been selling, but as I add to retirement accounts, I haven't been buying gold so it is going below the 5% mark.) I arrived at this number after reading a lot of different sample portfolio allocations, and some books. Some people recommend what I consider crazy allocations: 25-50% in gold. From what I could figure out in terms of modern portfolio theory, holding some metal reduces your overall risk because it generally has a low correlation to equity markets. The problem with gold is that it is a lousy investment. It doesn't produce any income, and only has costs (storage, insurance, commissions to buy/sell, management of ETF if that's what you're using, etc). The only thing going for it is that it can be a hedge during tough times. In this case, when you rebalance, your gold will be high, you'll sell it, and buy the stocks that are down. (In theory -- assuming you stick to disciplined rebalancing.) So for me, 5% seemed to be enough to shave off a little overall risk without wasting too much expense on a hedge. (I don't go over this, and like I said, now I'm underweighted.)" }, { "docid": "308332", "title": "", "text": "I'm all-in on hard silver, a small portion is stored at my house for emergency expenditures and the vast majority is in a high-security vault in Canada. That was actually the cheapest place I could find for long-term storage and insurance, which happened to be off-shore. It could turn out to be beneficial to be off-shore though. In the 1930s gold became illegal to privately own its very possible they could do the same this time, although they didn't in 1979. Oil is too high in volume to reasonably store. Gold isn't as undervalued as silver, which I could spend a full day talking about. But to sum it up in a few points: there is less silver than there is gold, gold has a premium for jewelry which will likely go down in a crash even though you will still see gains, silver is the second most used commodity besides oil, less people are in the know about it, silver prices were actually higher than gold a few times in the past century, simply measuring the dow in silver will show it's further below the historical average compared to gold. I'll stop there, but I could go on though on silver if people want. Real-estate is still very expensive from the 2008 recession, traditionally mortgages are $1.05 per dollar you would spend on renting the same property. Currently real-estate is at like $1.25+ I believe, It peaked at about $1.95. I rent, to save money, which you can spend on other assets. If one's willing to move to another state for lower taxes, they definitely should. Employment is going to be harder to come by, and they should get as much out of it as possible as they can. If they don't save enough, they could end up just using their entire savings during the whole thing if they can't find a job, in which case at the end you'd never know they knew it was going to happen. Overall I don't think this crash is going to be like the great depression. I don't feel compelled to store food and buy a generator or anything. I believe the living will be *easier* than it were to live in the 90s for those who are invested in assets. Everything is going to be on sale, meanwhile their wealth will be increasing. Depending on how much they own it could be increasing faster than they need to spend it. Sounds like the life to me. But with that said those without real assets, especially the lower class, will be unemployed and living on food stamps. Perhaps even the food stamps making more people leave the dollar and the economy. This actually might not be a prediction and is what happening already. But I don't believe anybody, in america at least, will be starving. In the 30s we had not mastered industry farming yet and we had the *dustbowl* to make things worse. Crime though, I'd own a gun. The protesters are here already, and I think we are just passing the half-way point right now, they will get angrier. I don't know enough about taxes to know the best country or place to store to combat taxes. Maybe someone else can chime in. I'm in canada to avoid high insurance and storage fees. And for careful selection of primary residence, In the long haul I'd rent a small apartment, as small and cheap as possible. In a safe neighborhood, but not so much secluded that a single grocery store or gas station going out of business could ruin it." }, { "docid": "414868", "title": "", "text": "\"We were on the \"\"gold standard\"\" in name only since about 1910. There was not enough gold to remotely back the US currency, which is why during the great depression when people started wanting to turn their cash back in to gold there was no enough, and gold possession had to be outlawed (well, partially). So no, we were not on a gold standard. Secondly, when you're on a (any fixed item) standard, your economy only can grow at roughly the rate you fond more of the (fixed item). There are many reasons for this, and it is partially why for thousands of years of various gold standard there was so little economic growth. Once countries stopped limiting the amount of total economic growth to the amount of gold they could dig up, that economies were able to grow at the sustained rate they have for the past 200ish years. So, besides the fact that the US has not in modern history been backed by gold, despite the name, there is ample evidence from hundreds of economies and thousands of years that being on a gold standard = little or no economic growth.\"" }, { "docid": "474129", "title": "", "text": "\"There's a few layers to the Momentum Theory discussed in that book. But speaking in general terms I can answer the following: Kind of. Assuming you understand that historically the Nasdaq has seen a little more volatility than the S&P. And, more importantly, that it tends to track the tech sector more than the general economy. Thus the pitfall is that it is heavily weighted towards (and often tracks) the performance of a few stocks including: Apple, Google (Alphabet), Microsoft, Amazon, Intel and Amgen. It could be argued this is counter intuitive to the general strategy you are trying to employ. This could be tougher to justify. The reason it is potentially not a great idea has less to do with the fact that gold has factors other than just risk on/off and inflation that affect its price (even though it does!); but more to do with the fact that it is harder to own gold and move in and out of positions efficiently than it is a bond index fund. For example, consider buying physical gold. To do so you have to spend some time evaluating the purchase, you are usually paying a slight premium above the spot price to purchase it, and you should usually also have some form of security or insurance for it. So, it has additional costs. Possibly worth it as part of a long-term investment strategy; if you believe gold will appreciate over a decade. But not so much if you are holding it for as little as a few weeks and constantly moving in and out of the position over the year. The same is true to some extent of investing in gold in the form of an ETF. At least a portion of \"\"their gold\"\" comes from paper or futures contracts which must be rolled every month. This creates a slight inefficiency. While possibly not a deal breaker, it would not be as attractive to someone trading on momentum versus fundamentals in my opinion. In the end though, I think all strategies are adaptable. And if you feel gold will be the big mover this year, and want to use it as your risk hedge, who am I or anyone else to tell you that you shouldn't.\"" }, { "docid": "266984", "title": "", "text": "\"&gt;We were on the \"\"gold standard\"\" in name only since about 1910. There a few nuances behind the \"\"gold standard\"\" but all revolve around indebtedness and currency devaluation. The US actually started off in 1785 with a Silver standard. By the turn of the 18th century there was a fixed ratio of silver and gold to dollars. Silver was not required to back all of the currency, gold was used as well. This bi-metallic standard continued until 1920s. Gold and Silver were legal tender. The US treasury was on a strict hard-money standard. Doing business in only gold and silver until 1848 which seperated the Federal Government from the banking system. It was only after this move the federal government started the devaluation/overvaluation of silver in order to \"\"borrow\"\" from England. Silver came in, Gold came out. This also largely catalyzed the 1849 Gold Rush. Then in 1853 the US started reducing the weight of silver coins. In 1857 banks suspended payment in Silver. But the basic weakness in a gold standard started with GOVERNMENT wanting to manipulate value to unfairly skew debt/loan situations. &gt;There was not enough gold to remotely back the US currency This is not true. US currency did just fine, and as governments print, so too do prices go up. So if there is only 50 Billion currency units in existance and eggs cost 10 cents (as they did for previous decades), when the federal government prints its way to trillions thats where we end up with eggs costing 2-3 bucks. That's why your grandparents house cost 6,000 and ones today cost 600,000. &gt;which is why during the great depression when people started wanting to turn their cash back in to gold there was no enough No, they turned back to gold because of the devaluation of the dollar. If the dollar was falling as it is today, why would you want to keep your assets in dollars? Gold cannot be printed at whim, this is one of the most important factors. It forces government to be much more strict with debt. If taxpayers were faced with higher taxes or devaluation to pay for the current Iraq/Afganistan wars, would it have happened? No, but since the government could print money at whim, it served as an invisible tax. &gt;and gold possession had to be outlawed It was outlawed because as the dollar plummeted and gold was eventually made illegal, the value of gold doubled and rapidly increased overnight, this happened again in 1970 when nixon took us off the gold standard. Gold posession was made illegal to prevent \"\"hoarders and opportunists\"\". You make it sound like gold redemption is a bad thing, when really its the government being naughty and citizens simply playing the game and by the rules set up by the government. &gt;So no, we were not on a gold standard. Yeah I never said we were. But there is a very important reason we once were, so government couldnt devalue currency to rack up more debt. (A HUGE issue that has now played out to its logical conclusion, maximum indebtedness mixed with massive mechanisms for manipulation) &gt;Secondly, when you're on a (any fixed item) standard, your economy only can grow at roughly the rate you fond more of the (fixed item). Is that why the US did just fine between 1780 and 1913? Over a hundred years. The cost of many items was stable for DECADES. Nowadays we have a doubling effect with cars costing 4,000 in 1970, 26,000 in 2000, 45,000 in 2012. The same with houses, food, education, medical services, you name it. &gt;There are many reasons for this, and it is partially why for thousands of years of various gold standard there was so little economic growth. Once countries stopped limiting the amount of total economic growth to the amount of gold they could dig up, that economies were able to grow at the sustained rate they have for the past 200ish years. Wrong again, this is because of productivity from technology and invention, oil, electricity, automobiles, airplanes and eventually computers. Infact as I said above, fiat currency actually kills productivity. Its hard to compare the turn of the century, but we can see what happened after nixon took us off the gold standard here: http://azizonomics.files.wordpress.com/2012/06/tfp.jpeg as soon as the USA left the gold exchange standard, total factor productivity began to dramatically stagnate. 1.Leaving the gold exchange standard was a free lunch for policymakers: GDP growth could be achieved without any real gains in productivity, or efficiency, or in infrastructure, but instead by just pumping money into the system. 2.Leaving the gold exchange standard was a free lunch for businesses: revenue growth could be achieved without any real gains in productivity, or efficiency. &gt;So, besides the fact that the US has not in modern history been backed by gold, despite the name, there is ample evidence from hundreds of economies and thousands of years that being on a gold standard = little or no economic growth. Since nixon took us off the gold standard in terms of dollar connection in anyway to gold the value of the dollar has plummeted 70%. Its over 95% if you go back to the early 1900s and currency debasement. There was plenty of economic growth while we were on the gold standard and to say otherwise is simply false.\"" }, { "docid": "179865", "title": "", "text": "This is wrong. Clear but wrong. A different story that has the benefit of being true follows. Money is an agreed-upon fiction. When, say, the Romans invaded a territory they had to find a way to feed their army and pay their soldiers. The soldiers could just steal stuff, but that was unsustainable because after awhile all economic activity would just stop. So, the army paid the soldiers with coins that could then be used by the soldiers to purchase things from the natives. Now, the people had no reason to accept these stamped pieces of metal (gold and silver are not inherently valuable, it's just an agreed-upon fiction). To force acceptance, Rome imposed taxes that had to be paid in Roman coinage. Now, the people had to accept the coins to accumulate enough to pay their taxes, the soldiers were able to spend their pay, and a more-or-less modern looking economy was born. Coins stamped with a monetary value have always been worth more than the market price of the underlying metal, (except in extreme circumstances.) Currency has value because it can be used to pay taxes." }, { "docid": "272547", "title": "", "text": "\"Ok, I think what you're really asking is \"\"how can I benefit from a collapse in the price of gold?\"\" :-) And that's easy. (The hard part's making that kind of call with money on the line...) The ETF GLD is entirely physical gold sitting in a bank vault. In New York, I believe. You could simply sell it short. Alternatively, you could buy a put option on it. Even more risky, you could sell a (naked) call option on it. i.e. you receive the option premium up front, and if it expires worthless you keep the money. Of course, if gold goes up, you're on the hook. (Don't do this.) (the \"\"Don't do this\"\" was added by Chris W. Rea. I agree that selling naked options is best avoided, but I'm not going to tell you what to do. What I should have done was make clear that your potential losses are unlimited when selling naked calls. For example, if you sold a single GLD naked call, and gold went to shoot to $1,000,000/oz, you'd be on the hook for around $10,000,000. An unrealistic example, perhaps, but one that's worth pondering to grasp the risk you'd be exposing yourself to with selling naked calls. -- Patches) Alternative ETFs that work the same, holding physical gold, are IAU and SGOL. With those the gold is stored in London and Switzerland, respectively, if I remember right. Gold peaked around $1900 and is now back down to the $1500s. So, is the run over, and it's all downhill from here? Or is it a simple retracement, gathering strength to push past $2000? I have no idea. And I make no recommendations.\"" }, { "docid": "352485", "title": "", "text": "The answer is that other than a small number of applications (the approx. 10% of gold production that goes to 'industrial uses') gold does not have intrinsic value beyond being pretty and rare (and useful for making jewelry.) There are a number of 'industrial' applications and uses for gold (see other answers for a list) but the volume consumed this way is fairly small, especially relative to the capacity to mine new gold and reclaim existing gold. If you removed investment, and jewelry usage (especially culturally driven jewelry usage) then there's no way the remaining uses for industry and dentistry could sustain the price levels we currently see for gold. Furthermore, and perhaps more importantly, the best data I can find for this shows the total number of tons consumed for industrial uses has been shrinking for several years now, and that was prior to recent price increases, so it is difficult to tie that reduced demand to increasing prices. And one might postulate in a 'collapsed society' you seem to be referring to in your question, that a lot of the recent industrial demand (e.g. the '50 cents of gold in each cellphone') could quite possibly disappear entirely. The argument many people use for gold having value is usually 'been used as money for thousands of years'. But this confuses gold having a value of its own with the reasons why something makes a useful currency. Gold has a large number of characteristics that make it an ideal currency, and of all the elements available it is perhaps the best physical element to serve as a currency. BUT just as with a dollar bill, just because it is a good currency, does NOT give it an intrinsic value. Any currency is only worth what someone will trade you for it. The value is set by the economy etc., not the medium used as a currency. So yes, people will probably always use gold as money, but that doesn't make the money worth anything, it's just a medium of exchange. Incidentally two other things should be noted. The first is that you have a problem when the medium itself used for a currency becomes worth more than the face value. Hence why we stopped using silver in coins, and there were concerns over pennies due to the price of copper. This leads to the second point, which is that currently, gold is TOO RARE to suffice as a world currency, hence why all countries went off the gold standard years ago. The size of national and global economies was growing faster than the supply of gold, and hence it was becoming impossible to have enough gold to back all the currencies (inflation concerns aside)." }, { "docid": "491523", "title": "", "text": "\"In the US, this was the case during the 19th century. There was a system of \"\"subscriptions\"\" between banks, where larger banks backed the smaller banks to some extent. In trade, notes from distant banks were not accepted or discounted relative to known local banks, or silver/gold coinage. There were a number of problems with this system which came to a head during the Panic of 1907. During this crisis, a cascading series of banking failures was only stopped by the personal intervention of JP Morgan. Even when Morgan intervened, it was very difficult to make capital available in a way that avoided the panic. The subsequent creation of the Federal Reserve was a response to that crisis.\"" }, { "docid": "61329", "title": "", "text": "By mentioning GLD, I presume therefore you are referring to the SPRD Gold Exchange Traded Fund that is intended to mirror the price of gold without you having to personally hold bullion, or even gold certificates. While how much is a distinctly personal choice, there are seemingly (at least) three camps of people in the investment world. First would be traditional bond/fixed income and equity people. Gold would play no direct role in their portfolio, other than perhaps holding gold company shares in some other vehicle, but they would not hold much gold directly. Secondly, at the mid-range would be someone like yourself, that believes that is in and of itself a worthy investment and makes it a non-trivial, but not-overriding part of their portfolio. Your 5-10% range seems to fit in well here. Lastly, and to my taste, over-the-top, are the gold-gold-gold investors, that seem to believe it is the panacea for all market woes. I always suspect that investment gurus that are pushing this, however, have large positions that they are trying to run up so they can unload. Given all this, I am not aware of any general rule about gold, but anything less than 10% would seem like at least a not over-concentration in the one area. Once any one holding gets much beyond that, you should really examine why you believe that it should represent such a large part of your holdings. Good Luck" }, { "docid": "180404", "title": "", "text": "\"Intrinsic value is a myth. There is no such thing. Subjective human demand is the only thing that gives anything value. This subjectivity is different person to person and can change very quickly. Historically there are two main uses for gold: jewelry and money. How can you tell when a particular type of money is undervalued? It disappears from circulation since people prefer to use money that is overvalued. This phenomenon is paraphrased in Gresham's Law: Bad money drives out good money. The Coinage Act of 1792 established the US dollar as 371.25 grains of silver or 24.75 grains of gold. This established a government ratio of 15 ounces of silver to 1 ounce of gold. In the late 18th century there was a large production of silver from Mexico and the market ratio of silver to gold increased to 15.75 to 1 by 1805. The government ratio, however, was still 15 to 1. This was enough incentive for people to exchange their silver coins for gold coins at the government ratio, melt the gold, and sell the gold bullion overseas at the market value. Thus, gold coins disappeared from circulation as people either hoarded the gold or sent it abroad. People used the overvalued silver coins (i.e. the \"\"bad\"\" money) domestically and gold coins disappeared from the market. In an attempt to correct the problem of disappearing gold coins the Coinage Act of 1834 was enacted. It kept the US dollar at 371.25 grains of silver but changed the definition to 23.2 grains of gold which established a government ratio of 16 to 1. This was close to the market ratio of gold to silver at the time so both gold and silver coins appeared in circulation again. The gold rush of 1849 produced a lot of gold and the market ratio of silver to gold became 15.46 to 1. Now gold was overvalued so people began exchanging their gold coins for silver coins at the government ratio, melt the silver, and sell the silver bullion overseas at the market value. People used the overvalued gold coins (i.e. the \"\"bad\"\" money) domestically and silver coins disappeared from the market. When you see gold circulating everywhere you will know it is overvalued compared to other types of money. Paper money always drives gold out of circulation since the market ratio of paper to gold severely under values gold. Source here.\"" }, { "docid": "566458", "title": "", "text": "What is the best way that I can invest money so that I can always get returns? If you want something that doesn't require any work on your end, consider having a fee-only financial planner make a plan so that your investments can be automated to generate a cash flow for you or get an annuity as the other classic choices here as most other choices will require some time commitment in one form or other. Note that for stock investments there could be rare instances like what happened for a week in September in 2001 where the markets were closed for 5 days straight that can be the hiccup in having stocks. Bonds can carry a risk of default where there have been municipalities that defaulted on debt as well as federal governments like Russia in the 1990s. Real estate may be subject to natural disasters or other market forces that may prevent there always being a monthly payment coming as if you own a rental property then what happens if there aren't tenants because there was an evacuation of the area? There may be some insurance products to cover some of these cases though what if there are exceptionally high claims all at once that may have an insurance company go under? Would it be to set up an FD in a bank, to buy land, to buy a rental house, to buy a field, or maybe to purchase gold? What investment of your own time do you plan on making here? Both in terms of understanding what your long-term strategy is and then the maintenance of the plan. If you put the money in the bank, are you expecting that the interest rate will always be high enough to give you sufficient cash to live as well as having no financial crisis with the bank or currency you are using? Are there any better investments? You may want to reconsider what assumptions you want to make and what risks you want to accept as there isn't likely to be a single solution here that would be perfect." }, { "docid": "239509", "title": "", "text": "\"It's not clear that anything needs to go up if gold goes down. In a bubble, asset prices can just collapse, without some other asset increasing to compensate. Economies are not a zero-sum game. On the other hand, gold may fall when people decide they don't need to hoard some store of value that, to their minds, never changes. It could very well indicate that there is more confidence in the broader economy. I am not a gold bug, so I don't much see the point in \"\"investing\"\" in something that is non-productive and also inedible, but to each his own.\"" }, { "docid": "89311", "title": "", "text": "You can buy real gold, or you can buy shares of a gold ETF, or invest in gold futures contracts. There's a number of ways, but the goal is to be exposed to the price fluctuations of gold. I actually have a bank account through www.goldmoney.com. It works just like PayPal or a bank account. You send money and buy gold and then they send you a debit card linked to that account. When you swipe it, you're spending your gold. They also cater to business customers as well..you can send invoices to get paid, do payroll, and everything in between." } ]

[ { "docid": "146995", "title": "", "text": "\"BlackJack's answer is technically correct: government credit ratings are independent of corporate credit ratings. The rating should reflect the borrower's ability to repay its obligations. One reason the book you read may have stated that corporate credit ratings cannot be better than the government's credit rating is that the government, unlike the corporation, can steal (or in government parlance \"\"tax\"\") from anywhere or anyone. So if a government finds itself in financial difficulty it could simply take the cash from corporations or people with high credit ratings by a variety of methods: implement windfall profit taxes, take over industries, take peoples gold, tax pension savings, or simply take peoples pensions or retirement savings. This increases the risk of doing business in a country with an over-extended government. Over extended governments do not die gracefully. They only die when there is nothing left to steal.\"" } ]

[ { "docid": "310103", "title": "", "text": "\"It's generally not possible to open a business account in the UK remotely. It's even difficult (near impossible) for a non-resident (even if a citizen) to open a business or personal bank account while visiting the UK. A recent report says that it may be possible to open an account via Barclays Offshore in the Isle of Man. This requires a large deposit, and probably lots of paperwork and fees (most offshore locations have stricter \"\"know your customer\"\" rules than major countries). Note that while the Isle of Man is inside the UK banking system (for sort codes, account numbers), it is a separate territory that doesn't have the same deposit guarantees as the UK. There is no legal reason why a UK company has to bank within the UK banking system, although many companies paying the company would expect it or require it, and an account in anything other than sterling would complicate the accounts. It could have an account in your home country. It's not even a legal requirement that the company has an account in its own name at all. Some people use a (separate) personal account for this purpose. There are plenty of reasons why this is a bad idea (for example it's unclear who/what owns the money in the account, and can give the appearance of director's loans), but it's a work-around. Most inbound electronic payments only require a sort code and account number, the account owner name is not checked. The UK does have a much simpler and cheaper company registry than most European countries, but the near-impossibility of opening a bank account for a business in the UK as a non-resident has made it an unsuitable place to register a small international company.\"" }, { "docid": "506567", "title": "", "text": "\"You have a few options, none of which are trade off free: Apply for a credit card, and live off of that. Here, of course, you will go into debt, and there are minimums to pay. But, it will tide you over. In any case, you are getting unsecured credit, so your rates will probably be very, very high. You don't want to build up a lot of 20% per annum debt. An alternative to this would be to go to any bank and ask for an unsecured loan. Having no income, it will be difficult, though not necessarily impossible, to secure some funds. When I was in between houses, once, for example, I was able to borrow $30,000 in unsecured debt (to help me construct my new house!), just based on my income. Grant you, I paid it 2 months later, in order to avoid the 10% / year interest, but the point is that unsecured debt does exist. Credit Cards are easier to get. Arrange for personal financing through your parents or other relatives. If your parents can send you remittances, the terms will most likely be more generous. They know your credit and your true ability to repay. Just because they send you money doesn't mean you have to live with them. As a parent, I have a stake in ensuring my children's success. If I think that tiding them over briefly is in their best interest and mine, you better be sure I'll do it. A variation on this is Microfinance - something like Kiva. Here, if you can write up a story compelling enough to get finance, there are people who might lend you money. Kiva is normally directed towards poorer countries and entrepeneurs - but local variations exist. UPDATE: Google-backed 'LendingClub.com is far more appropriate to this situation than Kiva. Same general idea, but that's the vendor. Find freelance, contract, or light employment. Your concern about employment is justified - you don't want to be in a position where you are unable to travel to an interview because Starbucks or McDonalds will fire you if you don't show up for a shift. (Then again, do you really care if McDonald's lets you go?) As such, you need to find income that is less bound by schedule. Freelance work, in particular, will give you that freedom - assuming you have a skill you can trade. Likewise, short term contract work is equally flexible - usually. Finally, it may be easiest just to get temporary pickup work in a service capacity. In any event, doing something will be better than doing nothing. Who knows, you might want to be a manager / owner of a McDonalds some day. Wouldn't hurt to say, \"\"I started at the bottom.\"\"\"" }, { "docid": "44223", "title": "", "text": "The biggest risk is Credit Utilization rate. If you have a total of $10,000 in revolving credit (ie: credit card line) and you ever have more than 50% (or 33% to be conservative) on the card at any time then your credit score will be negatively impacted. This will be a negative impact even if you charge it on day one and pay it off in full on day 2. Doesn't make much sense but credit companies are playing the averages: on average they find that people who get close to maxing their credit limit are in some sort of financial trouble. You're better off to make small purchases each month, under $100, and pay them off right away. That will build a better credit history - and score." }, { "docid": "511647", "title": "", "text": "\"This page from TripAdvisor may be of interest. Look at what fees are charged on your ATM cards and credit cards, and consider overpaying your credit card so you have a credit balance that you can draw on for cash \"\"advances\"\" from ATMs that will dispense in local currency. Depending on what fees your bank charges, you may get a better rate than the forex cash traders at the airport. Edit: Cards may not always have the best rate. I recently heard from a traveler who was able to use a locally but not globally dominant currency to buy cash of a major currency at a shopping mall (with competitive forex traders) at rates even better than the mid-market rates posted at xe.com and similar places; I don't think you'll have that experience going from Australia to Malaysia (but another traveler reading this might have a different pair). In my experience the card rates are slightly worse than those and the airport forex traders significantly worse.\"" }, { "docid": "439779", "title": "", "text": "I want to shop in the currency that will be cheapest in CAD at any given time. How do you plan to do this? If you are using a debit or credit card on a CAD account, then you will pay that bank's exchange rate to pay for goods and services that are billed in foreign currency. If you plan on buying goods and services from merchants that offer to bill you in CAD for items that are priced in foreign currency (E.g. buying from Amazon.co.uk GBP priced goods, but having Amazon bill your card with equivalent CAD) then you will be paying that merchant's exchange rate. It is very unlikely that either of these scenarios would result in you paying mid-market rates (what you see on xe.com), which is the average between the current ask and bid prices for any currency pair. Instead, the business handling your transaction will set their own exchange rate, which will usually be less favorable than the mid-market rate and may have additional fees/commission bolted on as a separate charge. For example, if I buy 100 USD worth of goods from a US vendor, but use a CAD credit card to pay, the mid-market rate on xe.com right now indicates an equivalent value of 126.97 CAD. However the credit card company is more likely to charge closer to 130.00 CAD and add a foreign transaction fee of maybe $2-3, or a percentage of the transaction value. Alternatively, if using something like Amazon, they may offer to bill the CAD credit card in CAD for those 100 USD goods. No separate foreign transaction fee in this case, but they are still likely to exchange at the less favorable 130.00 rate instead of the mid-market rates. The only way you can choose to pay in the cheapest equivalent currency is if you already have holdings of all the different currencies. Then just pay using whichever currency gets you the most bang for your buck. Unless you are receiving payments/wages in multiple currencies though, you're still going to have to refill these accounts periodically, thus incurring some foreign transaction fees and being subject to the banker's exchange rates. Where can I lookup accurate current exchange rates for consumers? It depends on who will be handling your transaction. Amazon will tell you at the checkout what exchange rate they will apply if you are having them convert a bill into your local currency for you. For credit/debit card transactions processed in a different currency than the attached account, you need to look at your specific agreement or contact the bank to see which rate they use for daily transactions (and where you can obtain these rates), whether they convert on the day of the transaction vs. the day it posts to your account, and how much they add on ($ and/or %) in fees and commission." }, { "docid": "569207", "title": "", "text": "\"&gt;We also have the highest expenditures as a percent of GDP than any other nation. Needless to say we spend a LOT on health care also. That is in large part do to insane healthcare costs passed on to the consumers by the aca. Healthcare spending has increased on average 1.5% annually since 2009 where as the highest growth in spending from 1991 until 2006 was 1.3% (im willing to admit my research may be incomplete or inaccurate here as the available rescources are pretty limited in my short time researching) &gt;we do have arguably the best health care services in the world... that is mostly only true if you are very wealthy. Thats a dumb statement leftists make. There is no excuse to not put yourself in debt for the best healthcare possible. Idk about you but I'd rather be in a lot of debt getting first rate healthcare than get affordable care from a 2nd rate community college doctor. Did you also know that medical debt doesnt effect your credit score so even if you \"\"default\"\" on medical debts it doesnt effect any part of your life. so why wouldnt you go in debt and then slowly pay off that debt with no fear of negative repercussions for not paying? &gt;When you break it down on results per dollar spent, the US doesn't even break the top 20. When you break it down on infant mortality, and life expectancy, we have been on a backward slide for a while now (although those rates improved for the short while that the ACA has been in effect, as have the net increase in costs). At the end of the day, the cost of health care has grown 3X faster than inflation, and 20X faster than the average income for over 30 years now. So, no, health care in this country is not the best to the average person. I dont have health insurance and an ER visit with xrays costs me less out of pocket than 90% of the country why is that? Do you think it has to do with the fact that with the aca hospitals know they are getting paid with 0 questioning on pricing so charge whatever they want and with me they think \"\"shit this guy might not ever pay us lets just give him a decent price and get some money from him because all we can do is send his bill to collections\"\" you clearly dont know how the system works especially because you think its my responsibility to provide you with health insurance. You keep saying i need to travel and experience the world when all you need to do is go to google and look at what a wonderful job Switzerland does with their healthcare. The swiss do everything better, They have some of the best services in the world and a very affordable healthcare plan with many options that is affordable to the tax payers unlike the ACA. You have a very clear Scandinavian bias as im assuming you're a bernie supporter who loves democratic socialism despite all of its short comings. &gt;And yes, Space X has been able to estimate a savings of $300M less... Commercial does a great job of expanding on the research and knowledge that has come from government sponsored R&amp;D. You see that in every modern technological advancement - from the internet, cellular phones, GPS, medical procedures, etc. There are so many modern inventions that have sprung from government patents and government research programs. This is the dumbest statement youve made this entire time. The notion that inventions that were made on the governments dime (my dime) is somehow the product of the government is asinine at best. Youre operating under the assumption that these inventions wouldnt have been made without government funding which is false. They all would have been made on a smaller budget granted maybe a little bit further down the road but not by much considering technology has expanded (with no help from any government) more in the last 20 years than in the prior 200 because thats what technology does it makes life easier for everyone and almost innovates itself. Take apple for instance where is all the government funding they recieved to be one of the most innovative companies in human history or microsoft? Yiou can max 10 things government funding invented when i can walk into your house and point out 10000 things the government had no hand in at all.\"" }, { "docid": "486729", "title": "", "text": "Someone else might be able to provide more details - but generally yes, of course. International corporations can pursue debt collection across borders - whether or not they do is a matter of convenience rather than law. My understanding is that a company's ability to report on your credit report is dependent on their membership in Equifax, USA etc. - so while most of your credit is country by country, international companies or companies with any relationship in other countries can follow you cross-border if they find out your new address and report the debt w/ that address. Since virtually every major company has some American affiliate, I wouldn't hold my breath that you can escape it indefinitely ESPECIALLY since you don't already have the debt, and have the power to actually pay for the service that you're using. Also - this is an incredibly scummy thing to do, and no matter how you dress it up as a financial decision it's just theft. Would you leave the country without paying your landlord? Without paying for groceries or other physical goods? Why is stealing from a telecom company any different?" }, { "docid": "261900", "title": "", "text": "\"To answer the investment aspect takes a bit of math. First, solar insolation numbers: This represents the average sun-hours per day for a given area. You can see the range from 4 to 6, or 1460 hrs to about 2190 hrs of sun per year depending on location. I believe electricity also has a range of cost, but 15 cents per KWH is a good average. So, a 1KW panel will produce as much as $328 per year of electricity in a high sun-hrs area, but only $219 in a lower sun-hrs area. If we agree to ignore the government subsidies and look for the stable price unaffected by outside influence, an installed price of even $2500 would produce a return of 13% and a reasonable full payback over an 8 year period. I call this installed price a tipping point, the price where this purchase provides a decent return. Some would accept a lower return, and therefore a higher price. As duff points out, this should be treated as the post rebate/tax credit price. Those help to push the price below this point. At the price point where the energy cost per panel is below, the government intervention may be unnecessary. The power companies may find consumer owned panels are the cheapest way to clip the peak consumption which tends to be the most expensive power demand.) One can take the insolation numbers and cost of local power to produce a grid showing the return for a 1KW panel in $$/year. (At this point the cost of money kick in. The present value of $100/yr is far higher today than if short term rates were say, 8%) Once panels drop to where they are compelling for the higher return areas, I'd expect volume to drive continued improvements in cost and better economies of scale. Initially, the need for storage isn't there, as the infrastructure is in place to drive your meter backwards if you produce more than you use. The peek sun coincides with peek demand and the electric companies are happy to have your demand go negative during those times. Update - the conversation with Duff led me to research 'demand charge' a bit more. You see, the utility company has to have equipment to generate the peak demand, usually occurring in the early afternoon, say 12N-2PM as the sun is brightest and AC use in particular, highest. I found that Austin energy has a PDF describing the fee for this. Simply put, the last kW of demand will cost you $14.03 in summer months and $12.65 in winter. This adds to $160/yr that a 1kW panel might save the owner. Even if one does capture the full power at peak every month, $100 is still non-trivial. This factor alone justifies $1000 worth of panel cost, and as Duff points out, the government may find it cheaper to use this method to clip peak demand than by funding bigger power generators. To summarize, the question isn't so much \"\"are they worth it\"\" as \"\"what is a xKW panel worth?\"\" (A function of annual savings and time value of money.) The ever decreasing installed cost for a given system makes solar an inevitable part of the future power technology. I am not a green tree hugging guy, but I do like to breathe fresh air as much as anyone. I'm happy with whatever role solar plays in cutting down pollution.\"" }, { "docid": "427311", "title": "", "text": "Assume you're asking about things like the Consumer Price Index? Different countries have different approaches. If they're honest, then the statistical sampling is conducted independently and consistently, with a clear publication schedule, and - as littleadv answered - by the men with clipboards. It is that publication schedule which leads to a little flurry of speculation as investors try to guess what unemployment, growth or inflation figures may be immediately prior to release. For many countries, such inflation measurement is entirely political, and so the statistical sampling is anything but honest or consistent. Argentina's official inflation rate, for example, is 9.7% but analysts regard the real inflation rate as closer to 25%. Places like Venezuela, Zimbabwe, Iran and even Egypt (prior to their revolution, who knows now) all manipulate statistics to portray their countries' economies in a better light. However, even in the US where the Bureau of Labour Statistics (BLS) has been nominally independent for over a century, the choice of what to include in the Consumer Basket (the official basket of items chosen to reflect cost-of-living, and measured by the men with clipboards) is not always honest. For 30 years the US basket has excluded house prices, because they were too volatile. Enter house-price credit disaster..." }, { "docid": "506108", "title": "", "text": "\"LLC is, as far as I know, just a US thing, so I'm assuming that you are in the USA. Update for clarification: other countries do have similar concepts, but I'm not aware of any country that uses the term LLC, nor any other country that uses the single-member LLC that is disregarded for income tax purposes that I'm referring to here (and that I assume the recruiter also was talking about). Further, LLCs vary by state. I only have experience with California, so some things may not apply the same way elsewhere. Also, if you are located in one state but the client is elsewhere, things can get more complex. First, let's get one thing out of the way: do you want to be a contractor, or an employee? Both have advantage, and especially in the higher-income areas, contractor can be more beneficial for you. Make sure that if you are a contractor, your rate must be considerably higher than as employee, to make up for the benefits you give up, as well as the FICA taxes and your expense of maintaining an LLC (in California, it costs at least $800/year, plus legal advice, accounting, and various other fees etc.). On the other hand, oftentimes, the benefits as an employee aren't actually worth all that much when you are in high income brackets. Do pay attention to health insurance - that may be a valuable benefit, or it may have such high deductibles that you would be better off getting your own or paying the penalty for going uninsured. Instead of a 401(k), you can set up an IRA (update or various other options), and you can also replace all the other benefits. If you decide that being an employee is the way to go, stop here. If you decide that being a contractor is a better deal for you, then it is indeed a good idea to set up an LLC. You actually have three fundamental options: work as an individual (the legal term is \"\"sole proprietorship\"\"), form a single-member LLC disregarded for income tax purposes, or various other forms of incorporation. Of these, I would argue that the single-member LLC combines the best of both worlds: taxation is almost the same as for sole proprietorship, the paperwork is minimal (a lot less than any other form of incorporation), but it provides many of the main benefits of incorporating. There are several advantages. First, as others have already pointed out, the IRS and Department of Labor scrutinize contractor relationships carefully, because of companies that abused this status on a massive scale (Uber and now-defunct Homejoy, for instance, but also FedEx and other old-economy companies). One of the 20 criteria they use is whether you are incorporated or not. Basically, it adds to your legal credibility as a contractor. Another benefit is legal protection. If your client (or somebody else) sues \"\"you\"\", they can usually only sue the legal entity they are doing business with. Which is the LLC. Your personal assets are safe from judgments. That's why Donald Trump is still a billionaire despite his famous four bankruptcies (which I believe were corporate, not personal, bankrupcies). Update for clarification Some people argue that you are still liable for your personal actions. You should consult with a lawyer about the details, but most business liabilities don't arise from such acts. Another commenter suggested an E&O policy - a very good idea, but not a substitute for an LLC. An LLC does require some minimal paperwork - you need to set up a separate bank account, and you will need a professional accounting system (not an Excel spreadsheet). But if you are a single member LLC, the paperwork is really not a huge deal - you don't need to file a separate federal tax return. Your income will be treated as if it was personal income (the technical term is that the LLC is disregarded for IRS tax purposes). California still does require a separate tax return, but that's only two pages or so, and unless you make a large amount, the tax is always $800. That small amount of paperwork is probably why your recruiter recommended the LLC, rather than other forms of incorporation. So if you want to be a contractor, then it sounds like your recruiter gave you good advice. If you want to be an employee, don't do it. A couple more points, not directly related to the question, but hopefully generally helpful: If you are a contractor (whether as sole proprietor or through an LLC), in most cities you need a business license. Not only that, but you may even need a separate business license in every city you do business (for instance, in the city where your client is located, even if you don't live there). Business licenses can range from \"\"not needed\"\" to a few dollars to a few hundred dollars. In some cities, the business license fee may also depend on your income. And finally, one interesting drawback of a disregarded LLC vs. sole proprietorship as a contractor has to do with the W-9 form and your Social Security Number. Generally, when you work for somebody and receive more than $600/year, they need to ask you for your Social Security Number, using form W-9. That is always a bit of a concern because of identity theft. The IRS also recognizes a second number, the EIN (Employer Identification Number). This is basically like an SSN for corporations. You can also apply for one if you are a sole proprietor. This is a HUGE benefit because you can use the EIN in place of your SSN on the W-9. Instant identity theft protection. HOWEVER, if you have a disregarded LLC, the IRS says that you MUST use your SSN; you cannot use your EIN! Update: The source for that information is the W-9 instructions; it specifically only excludes LLCs.\"" }, { "docid": "345697", "title": "", "text": "\"It all comes down to how the loan itself is structured and reported - the exact details of how they run the loan paperwork, and how/if they report the activity on the loan to one of the credit bureaus (and which one they report to). It can go generally one of three ways: A) The loan company reports the status to a credit reporting agency on behalf of both the initiating borrower and the cosigner. In this scenario, both individuals get a new account on their credit report. Initially this will generally drop related credit scores somewhat (it's a \"\"hard pull\"\", new account with zero history, and increased debt), but over time this can have a positive effect on both people's credit rating. This is the typical scenario one might logically expect to be the norm, and it effects both parties credit just as if they were a sole signor for the loan. And as always, if the loan is not paid properly it will negatively effect both people's credit, and the owner of the loan can choose to come after either or both parties in whatever order they want. B) The loan company just runs the loan with one person, and only reports to a credit agency on one of you (probably the co-signor), leaving the other as just a backup. If you aren't paying close attention they may even arrange it where the initial party wanting to take the loan isn't even on most of the paperwork. This let the person trying to run the loan get something accepted that might not have been otherwise, or save some time, or was just an error. In this case it will have no effect on Person A's credit. We've had a number of question like this, and this isn't really a rare occurrence. Never assume people selling you things are necessarily accurate or honest - always verify. C) The loan company just doesn't report the loan at all to a credit agency, or does so incorrectly. They are under no obligation to report to credit agencies, it's strictly up to them. If you don't pay then they can report it as something \"\"in collections\"\". This isn't the typical way of doing business for most places, but some businesses still operate this way, including some places that advertise how doing business with them (paying them grossly inflated interest rates) will \"\"help build your credit\"\". Most advertising fraud goes unpunished. Note: Under all of the above scenarios, the loan can only effect the credit rating attached to the bureau it is reported to. If the loan is reported to Equifax, it will not help you with a TransUnion or Experian rating at all. Some loans report to multiple credit bureaus, but many don't bother, and credit bureaus don't automatically copy each other. It's important to remember that there isn't so much a thing as a singular \"\"consumer credit rating\"\", as there are \"\"consumer credit ratings\"\" - 3 of them, for most purposes, and they can vary widely depending on your reported histories. Also, if it is only a short-term loan of 3-6 months then it is unlikely to have a powerful impact on anyone's credit rating. Credit scores are formulas calibrated to care about long-term behavior, where 3 years of perfect credit history is still considered a short period of time and you will be deemed to have a significant risk of default without more data. So don't expect to qualify for a prime-rate mortgage because of a car loan that was paid off in a few months; it might be enough to give you a score if you don't have one, but don't expect much more. As always, please remember that taking out a loan just to improve credit is almost always a terrible idea. Unless you have a very specific reason with a carefully researched and well-vetted plan that means that it's very important you build credit in this specific way, you should generally focus on establishing credit in ways that don't actually cost you any money at all. Look for no fee credit cards that you pay in full each month, even if you have to start with credit-building secured card plans, and switch to cash-value no-fee rewards cards for a 1-3% if you operate your financial life in a way that this doesn't end up manipulating your purchasing decisions to cost you money. Words to the wise: \"\"Don't let the credit score tail wag the personal financial dog!\"\"\"" }, { "docid": "372107", "title": "", "text": "In some case the customer wants the name to be cryptic or misleading. They don't want to advertise the true nature of the business they visited. In other cases the transaction may be reported through another business. A few years ago the local PTA was having a silent auction as a fundraiser. A local business allowed the PTA to use their credit card reader to process transactions over a certain amount. Of course when the credit card statement arrived it looked like you spent $500 at the florist. I have seen PayPal listed when donating to some small charities. I have noted another case where confusion can occur. I used a debit card to buy a soda from a vending machine: the name and location were the name of the vending machine company and the location of their main office. It didn't say soda machine city A. It said Joe's vending company city B. In most cases the business and the credit card company want to make it easy to identify the transactions to keep the cost of research and charge backs to a minimum." }, { "docid": "549665", "title": "", "text": "Why would a lender for a down payment want proof of income for a house when a credit card issuer gave me more and doesn't care? The risk profile and rate of interest are different. Could I use this argument as a basis that they have no reasoning to request proof of income, if another lender (credit card company) would give me more without proof of repayment? You could argue anything, but it does not mean the other company will agree with your argument. Should I borrow a home loan from a credit card company then? Or what's the catch here? You can. Check the rate of interest and penal fees; you would realize how much you will end up paying. Depending on the country, the difference could be in the region of 10-15%." }, { "docid": "277498", "title": "", "text": "\"&gt; That is in large part do to insane healthcare costs passed on to the consumers by the aca. Healthcare spending has increased on average 1.5% annually since 2009 where as the highest growth in spending from 1991 until 2006 was 1.3% Health Care costs have actually been on the rise for decades now. It was only \"\"noticed\"\" by the majority party (i.e. the GOP who had held the majority for 16 of the years prior to 2009) when the ACA was enacted. Suddenly, health care costs \"\"started\"\" to \"\"explode\"\". The truth is that health care costs have been on a steady rise. In the time period from 1972 to 1982, costs rose on [average 14% per year](https://www.thebalance.com/causes-of-rising-healthcare-costs-4064878). Keep in mind, this was prior to the expansion of Medicare. From 1983-1992 costs grew at a rate of 9% per year - 3 times faster than inflation. From 1993 to 2010, cost rose at a rate of 6.4% per year. The ACA of course was passed in 2009, but didn't start to take effect until 2011. Since 2010, health care costs has risen about 4% per year. That is a 2% drop in a short amount of time, compared to the previous years. However, the numbers are already so big, just like the national debt, that the GOP (who had as much part to play in the health care costs as they did in the debt) had tons of numbers they could use to make it seem like \"\"health care costs have exploded\"\". In reality, what happened is that people who never had health insurance before were forced to get it, and started to realize how expensive it is when it actually covers what it was intended to cover - preventative care as well as emergent care. The GOP has been on a steady march to undermine the new law as much as possible since it passed, because it made some of their biggest donors (HMOs, and Health Care Insurance providers) uncomfortable the fact that they HAD to share their cost information, and that the health care exchange required them to do a line item by line item comparison with other companies out there. So, here we are. The ACA is going to be cut, and millions of people are going back to be uninsured or underinsured. What you are going to see is the rate of costs growth start to increase again after decades of slowly decreasing rates. Why? Because of the renewed ability of insurance providers to hide the costs, to hide costs increases. It will also cause hospitals to greatly overcharge the uninsured, as they were doing before, but there will be many more of them. The goal being, that the uninsured are unlikely to pay for the (very large) medical bills. So, knowing this, hospitals artificially inflate the bill in the hopes of getting a larger portion of that unpaid bill liquidated through Medicare. Uninsured populations also lead to more unhealthy people. You would think that not having health insurance would make people want to remain more healthy. However, studies show [the opposite to be true](http://www.slate.com/articles/business/the_dismal_science/2011/07/does_health_coverage_make_people_healthier.html). In actuality, people stress more about their health, and avoid periodic checkups. Both of which lead to bad health results. Trying to blame the cost increases in health care on government \"\"meddling\"\", or say it is a problem brought on by the ACA is weird since there are [so many examples of government provided](https://www.forbes.com/sites/danmunro/2014/06/16/u-s-healthcare-ranked-dead-last-compared-to-10-other-countries/#175cf39e576f) health care programs out there which are so much more efficient, less costly, and have resulted in much healthier populations. &gt; I dont have health insurance and an ER visit with xrays costs me less out of pocket than 90% of the country why is that? I am going to call BS. Number one, that is a huge claim to make without supporting evidence. Number two, you would have to demonstrate how much that same visit would cost to those *with* health insurance. &gt; Do you think it has to do with the fact that with the aca hospitals know they are getting paid with 0 questioning on pricing so charge whatever they want and with me they think \"\"shit this guy might not ever pay us lets just give him a decent price and get some money from him because all we can do is send his bill to collections\"\" Actually, no. The [exact *opposite* happens](http://www.alternet.org/story/16466/why_hospitals_overcharge_the_uninsured). They now, because you are uninsured, that you are unlikely to pay. So they *overcharge* you for the same services because they know that they will only be reimbursed a percentage of the costs if it goes to Medicare for non-payment. &gt; The swiss do everything better, You keep referring back to Switzerland. Don't get me wrong, they are a very good country, and have the number 2 ranked health care system in the world. However, I don't think they are the low tax haven that you think they are. They have an [average corporate tax rate of 17.2%](https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates), whereas the US has it at 32%. Their highest income tax bracket is 13.2, whereas the US is at 39%. Their sales tax goes at high as 8%, where ours go as high as 11%. Their [average effective tax](http://www.economist.com/node/14340551) rate is around 11%, while ours is around 18%. Including Social Security puts Switzerland at 17%, and the US at 24%. So, they are definitely a lower tax rate country, but in no way are they a no tax rate country. Then again, Switzerland has no military to speak of, while the US spends more on military then the next 7 countries put together. &gt; This is the dumbest statement youve made this entire time. I have been very patient. I have stuck with this conversation, in spite of the put downs and snide remarks. I have jabbed a little too, but you can go back to most of my remarks and see that I have been more congenial. I have given you some leeway because of your age, and I am almost twice as old as you. So, you gave me your background. I will give you mine. I am closer to 50 then I would prefer. I left the house at 17, enlisted in the Navy, and spent the next 15 years serving in the military. I ended my career in a select community. I have been out for ten years this July. I am now owner of a company that does R&amp;D and works with the government. A lot of my knowledge about inventions, and how commercial works with government comes from my own personal experiences. I have seen the best, and worst, of government - as well as seen the same on the commercial side of the house. Anyone comes to this game with the presupposition that government can't get anything done as well as commercial quickly learns that is not true. Likeways, anyone comes thinking that commercial equals efficient learns *that* is not always true too. &gt; Take apple for instance where is all the government funding they recieved to be one of the most innovative companies in human history or microsoft? As I said previously, that you thought was a \"\"dumb\"\" comment - commercial is very good at taking existing systems and finding ways to make them efficient and better. Apple and Microsoft is the same. They both made their mark in history by expanding on and creating innovation with existing technologies that had their foundation in government R&amp;D projects - including the [digital computer](https://en.wikipedia.org/wiki/John_Vincent_Atanasoff), as well as computers like the [ENIAC and the UNIVAC](https://www.computerhope.com/issues/ch000984.htm), and the advancements into [microsecond multitasking](https://arstechnica.com/tech-policy/2011/06/did-ibm-invent-the-personal-computer-answer-no/) which lead to the first efficient and cost effective personal computers. The touchscreen was actually first invented in by [engineers at CERN](https://en.wikipedia.org/wiki/Touchscreen#History). And of course, we know that the [internet started as a government funded project called ARPANET](http://www.history.com/news/ask-history/who-invented-the-internet). I think you would be surprised how much many if not most of the things we take for granted today have a foundation in government funded R&amp;D. My company is a commercial company, and we do a great job creating our own products and innovation. And yet still, our best selling product is a design of a national laboratory that we license from them. Commercial industry is great at manufacturing and producing, something the government is not as good at, and so often they will license out designs for production to companies like ours. Some of the biggest commercial companies out there do the same.\"" }, { "docid": "585494", "title": "", "text": "\"Pay off the credit cards. From now on, pay off the credit cards monthly. Under no circumstances should you borrow money. You have net worth but no external income. Borrowing is useless to you. $200,000 in two bank accounts, because if one bank collapses, you want to have a spare while you wait for the government to pay off the guarantee. Keep $50,000 in checking and another $50k in savings. The remainder put into CDs. Don't expect interest income beyond inflation. Real interest rates (after inflation) are often slightly negative. People ask why you might keep money in the bank rather than stocks/bonds. The problem is that stocks/bonds don't always maintain their value, much less go up. The bank money won't gain, but it won't suddenly lose half its value either. It can easily take five years after a stock market crash for the market to recover. You don't want to be withdrawing from losses. Some people have suggested more bonds and fewer stocks. But putting some of the money in the bank is better than bonds. Bonds sometimes lose money, like stocks. Instead, park some of the money in the bank and pick a more aggressive stock/bond mixture. That way you're never desperate for money, and you can survive market dips. And the stock/bond part of the investment will return more at 70/30 than 60/40. $700,000 in stock mutual funds. $300,000 in bond mutual funds. Look for broad indexes rather than high returns. You need this to grow by the inflation rate just to keep even. That's $20,000 to $30,000 a year. Keep the balance between 70/30 and 75/25. You can move half the excess beyond inflation to your bank accounts. That's the money you have to spend each year. Don't withdraw money if you aren't keeping up with inflation. Don't try to time the market. Much better informed people with better resources will be trying to do that and failing. Play the odds instead. Keep to a consistent strategy and let the market come back to you. If you chase it, you are likely to lose money. If you don't spend money this year, you can save it for next year. Anything beyond $200,000 in the bank accounts is available for spending. In an emergency you may have to draw down the $200,000. Be careful. It's not as big a cushion as it seems, because you don't have an external income to replace it. I live in southern California but would like to move overseas after establishing stable investments. I am not the type of person that would invest in McDonald's, but would consider other less evil franchises (maybe?). These are contradictory goals, as stated. A franchise (meaning a local business of a national brand) is not a \"\"stable investment\"\". A franchise is something that you actively manage. At minimum, you have to hire someone to run the franchise. And as a general rule, they aren't as turnkey as they promise. How do you pick a good manager? How will you tell if they know how the business works? Particularly if you don't know. How will you tell that they are honest and won't just embezzle your money? Or more honestly, give you too much of the business revenues such that the business is not sustainable? Or spend so much on the business that you can't recover it as revenue? Some have suggested that you meant brand or stock rather than franchise. If so, you can ignore the last few paragraphs. I would be careful about making moral judgments about companies. McDonald's pays its workers too little. Google invades privacy. Exxon is bad for the environment. Chase collects fees from people desperate for money. Tesla relies on government subsidies. Every successful company has some way in which it can be considered \"\"evil\"\". And unsuccessful companies are evil in that they go out of business, leaving workers, customers, and investors (i.e. you!) in the lurch. Regardless, you should invest in broad index funds rather than individual stocks. If college is out of the question, then so should be stock investing. It's at least as much work and needs to be maintained. In terms of living overseas, dip your toe in first. Rent a small place for a few months. Find out how much it costs to live there. Remember to leave money for bigger expenses. You should be able to live on $20,000 or $25,000 a year now. Then you can plan on spending $35,000 a year to do it for real (including odd expenses that don't happen every month). Make sure that you have health insurance arranged. Eventually you may buy a place. If you can find one that you can afford for something like $100,000. Note that $100,000 would be low in California but sufficient even in many places in the US. Think rural, like the South or Midwest. And of course that would be more money in many countries in South America, Africa, or southern Asia. Even southern and eastern Europe might be possible. You might even pay a bit more and rent part of the property. In the US, this would be a duplex or a bed and breakfast. They may use different terms elsewhere. Given your health, do you need a maid/cook? That would lean towards something like a bed and breakfast, where the same person can clean for both you and the guests. Same with cooking, although that might be a second person (or more). Hire a bookkeeper/accountant first, as you'll want help evaluating potential purchases. Keep the business small enough that you can actively monitor it. Part of the problem here is that a million dollars sounds like a lot of money but isn't. You aren't rich. This is about bare minimum for surviving with a middle class lifestyle in the United States and other first world countries. You can't live like a tourist. It's true that many places overseas are cheaper. But many aren't (including much of Europe, Japan, Australia, New Zealand, etc.). And the ones that aren't may surprise you. And you also may find that some of the things that you personally want or need to buy are expensive elsewhere. Dabble first and commit slowly; be sure first. Include rarer things like travel in your expenses. Long term, there will be currency rate worries overseas. If you move permanently, you should certainly move your bank accounts there relatively soon (perhaps keep part of one in the US for emergencies that may bring you back). And move your investments as well. Your return may actually improve, although some of that is likely to be eaten up by inflation. A 10% return in a country with 12% inflation is a negative real return. Try to balance your investments by where your money gets spent. If you are eating imported food, put some of the investment in the place from which you are importing. That way, if exchange rates push your food costs up, they will likely increase your investments at the same time. If you are buying stuff online from US vendors and having it shipped to you, keep some of your investments in the US for the same reason. Make currency fluctuations work with you rather than against you. I don't know what your circumstances are in terms of health. If you can work, you probably should. Given twenty years, your million could grow to enough to live off securely. As is, you would be in trouble with another stock market crash. You'd have to live off the bank account money while you waited for your stocks and bonds to recover.\"" }, { "docid": "550909", "title": "", "text": "\"Americans don't actually believe that there are no categories where other countries surpass them. They believe that the unique mix of characteristics the country does have is the best mix available. People who say \"\"The United States is the best country in the world\"\" aren't saying that every aspect of American life is better than every aspect of life in any other country in the world. They're saying that they're willing to trade bad high schools for the best universities, that they would rather have a world-dominating GDP and a decent per capita than a world-dominating GDP per capita alone, that they would rather have New York City than Hong Kong. They're pointing out that the infant mortality rate between first world countries is essentially equal, and that the rankings hide the fact that the differences are negligible. They're not saying our health care system is better, that our public transportation is better, or even that our airlines are the most efficient. They're saying that in the weighted matrix of categories, no country gets a better score *despite* getting high scores in many areas. They're simply pointing out that their weight factors are different from yours. The anti-Americanism that is most honest is that of people like the rulers of North Korea who say, honestly, they don't like America because it is so large and successful, and that they hate it when this success is used to further human rights. But the more insipid and dishonest version doesn't recognize this, and attempts to hold up a straw man that Americans who say \"\"This is the greatest country on earth\"\" are stupid, toothless anti-intellectuals who honestly believe that there isn't a single statistic in which America doesn't top the world. These Americans are imaginary. They don't exist except in the imaginations of jealous masochists or as tiny fringe minorities in counties far removed from economic centers. America is the great experiment of the Enlightenment. It was the first country to be ruled by liberal democracy. And it isn't threatened when others join in the wealth generation that the philosophy yields. Indeed, they celebrate it. They even go too far in trying to spread it.\"" }, { "docid": "442110", "title": "", "text": "75k is short of the 'highly compensated' category. Most US citizens in that pay range would consider paying someone to do their taxes as an unnecessary expense. Tax shelters usually don't come into play for this level of income. However, there are certain things which provide deductions. Some things that make it better to pay someone: Use the free online tax forms to sandbox your returns. If all you're concerned about is ensuring you pay your taxes correctly, this is the most cost efficient route. If you want to minimize your tax burden, consult with a CPA. Be sure to get one who is familiar with resident aliens from your country and the relevant tax treaties. The estimate you're looking at may be the withholding, of which you may be eligible for a refund for some part of that withholding. Tax treaties likely make sure that you get credit on each side for the money paid in the other. For example, as a US citizen, if I go to Europe and work and pay taxes there, I can deduct the taxes paid in Europe from my tax burden in the US. If I've already paid more to the EU than I would have paid on the same amount earned in the US, then my tax burden in the US is zero. By the same token, if I have not paid up to my US burden, then I owe the balance to the US. But this is way better than paying taxes to your home country and to the host country where you earned the money." }, { "docid": "228774", "title": "", "text": "Most of this advice applies to the UK, where I work in motor insurance pricing for a large personal lines insurer, but a lot of it is more general. A loyal customer is usually an overpaying customer. The guiding priciple most financial services companies go by is that there's no point rewarding loyalty except to create it where none exists, i.e. by giving massive discounts to desirable new customers. Shop around every time your policy comes up for renewal, and whenever your circumstances change. Never allow your policy to automatically renew - you may be charged a higher premium by default if you do! Phone up your current insurer and haggle to see if they can beat the best quote you find - their agents will usually be able offer a discount. If applicable in your country, use price comparison websites. Use at least two - different insurers sometimes offer different rates on different sites, competing harder on some than on others, especially if the price comparison website happens to be owned by one of the insurance companies that quotes on it. One example of this is http://www.confused.com, which is owned by RSA group, a major insurer. If there are no price comparison websites for your country, try purchasing your policy through a broker. They'll get quotes from a panel of insurers and offer you the cheapest. They can be especially helpful if you have a problematic driving history, e.g. drink-driving convictions, as many mainstream insurers will decline to quote for such people. Other suggestions Chris Rea's answer is a good starting point, but I would disagree about cutting back on cover. In the UK at least, many insurers often charge an equal or greater amount for lower levels of cover, because the people who choose these policies tend to be worse risks. Re switching vehicles - a cheap old car will not necessarily be much cheaper to insure than a new expensive one, as you can still injure people with it or crash into other people's cars, and the newer car will probably have better safety features. However, a less powerful and smaller vehicle typically poses less of a threat to others and will therefore be cheaper to insure. Another tactic not mentioned so far is 'reverse fronting'. 'Fronting', where the main driver poses as an additional driver and nominates a less risky driver as the main driver, is illegal, but the reverse - adding a less risky driver as an additional driver - is legal and can sometimes reduce premiums. This is because only one of you can drive the car at any one time, and sometimes it'll be the less risky one. So, especially if you're male and aged < 25, see if adding your safest parent as a named driver makes a difference. If you have the choice of storing your car on a driveway or on the street, get quotes for both and see which is cheaper. If you live in an area where burglary is commonplace, thieves are more likely to steal cars left on driveways, as they can break into the owner's home and steal the keys. If not, the driveway is better, as it reduces the risk of a collision. If you have previously driven another vehicle (e.g. motorbike or moped), or if you've been insured as an additional driver on someone else's car, call up insurers directly and ask if they can offer you a no-claims bonus for this. Quotes from price comparison websites tend to limit you to the numbers of years of no-claims you've accrued as a main driver, and may not reflect your full available no-claims bonus. Extreme measures Some insurers give you the option to install a tracking device in your car that can tell them various things, e.g. Some people may be uncomfortable sharing this much information with their insurer, but for particularly risky drivers (I'm looking at you, males < 25) it can sometimes result in a substantial saving. One insurer that offers this is http://www.insurethebox.com/. Finally, if every insurer you can find is quoting in excess of £10,000 for a year's cover, you may find it cheaper instead to purchase a vintage agricultural vehicle and get it covered on a specialist farmer's policy: http://www.metro.co.uk/news/864501-teen-quoted-17k-for-car-insurance-resorts-to-driving-tractor" }, { "docid": "267422", "title": "", "text": "Credit history is local, so when you move to the US you start with the blank slate. Credit history length is a huge factor, so in the first year expect that nobody would trust you and you may be refused credit or asked for deposits. I was asked for deposits at cell phone company and refused for store cards couple of times. My advice - get a secured credit card (that means you put certain sum of money as a deposit in the bank and you get credit equal to that sum of money) and if you have something like a car loan that helps too (of course, you shouldn't buy a car just for that ;) but if you're buying anyway, just know it's not only hurting but also helping when you pay). Once you have a year or two of the history and you've kept with all the payments, you credit score would be OK and everybody would be happy to work with you. In 4-5 years you can have excellent credit record if you pay on time and don't do anything bad. If you are working it the US, a lot of help at first would be to take a letter from your company on an official letterhead saying that you are employed by this and that company and are getting salary of this and that. That can serve as an assurance for some merchants that otherwise would be reluctant to work with you because of the absence of credit history. If you have any assets overseas, especially if they are held in a branch of international bank in US dollars, that could help too. In general, don't count too much on credit for first 1-2 years (though you'd probably could get a car loan, for example, but rates would be exorbitant - easily 10 percentage points higher than with good credit), but it will get better soon." } ]

[ { "docid": "168382", "title": "", "text": "\"In one personal finance book I read that if a company is located in a country with credit rating X it can't have credit rating better (lower - i.e. further from AAA level) than X. This is simply wrong. Real world evidence proves it wrong. Automatic Data Processing (ADP), Exxon Mobile (XOM), Johnson & Johnson (JNJ), and Microsoft (MSFT) all have a triple-A rating today, even though the United States doesn't. Toyota (TM) remained triple-A for many years even after Japanese debt was downgraded. The explanation was the following: country has rating X because risk of doing business with it is X and so risk of doing business with any company located in that country automatically can't be better than X. When reading financial literature, you should always be critical. Let's evaluate this statement. First off, a credit rating is not the \"\"risk of doing business.\"\" That is way too generic. Specifically, a credit rating attempts to define an individual or company's ability to repay it's obligations. Buying treasuries constitutes as doing business with the gov't, but you can argue that buying stamps at USPS is also doing business with the gov't, and a credit rating won't affect the latter too much. So a credit rating reflects the ability of an entity to repay it's obligations. What does the ability of a government to repay have to do with the ability of companies in that country to repay? Not much. Certainly, if a company keeps it's surplus cash all in treasuries, then downgrading the government will affect the company, but in general, the credit rating of a company determines the company's ability to pay.\"" } ]

[ { "docid": "423871", "title": "", "text": "\"Besides your credit score, there are other smart reasons to have a second line of credit. (Your credit score doesn't affect you the majority of your life, but when it does whoooooo boy does it.) Should the first bank you have credit with create or find a clerical error, a second line of credit can provide a cushion while you sort it out with the first Should physically damage a card, or have it stolen, having a second backup at home will be helpful as you wait for a replacement. Getting a second line of credit with a different institution than your first allows you the flexibility to cancel one and move your business should the deal become unfavorable to you. Multiple lines of credit in of itself is a plus to your credit score (albeit a small one) You can organize your finances. One card handles the recurring payments in your life, the second incidentals. The expected activity type might make it easier to detect fraud. When you get your second line of credit, get it from a different institution than where you have any other business now. (A credit union if you can, or a small local bank). Make sure there is no annual fee, and if there is a reward, be certain it is worth it. Cash back is my favorite because I can spend cash where I like, whereas \"\"points\"\" have to come out of product in their catalogs. Lower interest rate is best of all. Even though you always plan on paying it off every month like clockwork, you might one day run into an issue where you cannot. Lower interest rate becomes very important in that plannings scenario.\"" }, { "docid": "93271", "title": "", "text": "If we're including psychological considerations, then the question becomes much more complicated: will having a higher available credit increase the temptation to spend? Will eliminating 100% of a small debt provide more positive reinforcement than paying off 15% of a larger debt? Etc. If we're looking at the pure financial impact, the question is simpler. The only advantage I see to prioritizing the lower interest card is the float: when you buy something on a credit card, interest is often calculated for that purchase starting at the beginning of the next billing cycle, rather than immediately from the purchase date. I'm not clear on what policies credit card companies have on giving float for credit cards with a carried balance, so you should look into what your card's policy is. Other than than, paying off the higher interest rate card is better than paying off the lower interest rate. On top of that, you should look into whether you qualify for any of the following options (presented from best to worst):" }, { "docid": "228774", "title": "", "text": "Most of this advice applies to the UK, where I work in motor insurance pricing for a large personal lines insurer, but a lot of it is more general. A loyal customer is usually an overpaying customer. The guiding priciple most financial services companies go by is that there's no point rewarding loyalty except to create it where none exists, i.e. by giving massive discounts to desirable new customers. Shop around every time your policy comes up for renewal, and whenever your circumstances change. Never allow your policy to automatically renew - you may be charged a higher premium by default if you do! Phone up your current insurer and haggle to see if they can beat the best quote you find - their agents will usually be able offer a discount. If applicable in your country, use price comparison websites. Use at least two - different insurers sometimes offer different rates on different sites, competing harder on some than on others, especially if the price comparison website happens to be owned by one of the insurance companies that quotes on it. One example of this is http://www.confused.com, which is owned by RSA group, a major insurer. If there are no price comparison websites for your country, try purchasing your policy through a broker. They'll get quotes from a panel of insurers and offer you the cheapest. They can be especially helpful if you have a problematic driving history, e.g. drink-driving convictions, as many mainstream insurers will decline to quote for such people. Other suggestions Chris Rea's answer is a good starting point, but I would disagree about cutting back on cover. In the UK at least, many insurers often charge an equal or greater amount for lower levels of cover, because the people who choose these policies tend to be worse risks. Re switching vehicles - a cheap old car will not necessarily be much cheaper to insure than a new expensive one, as you can still injure people with it or crash into other people's cars, and the newer car will probably have better safety features. However, a less powerful and smaller vehicle typically poses less of a threat to others and will therefore be cheaper to insure. Another tactic not mentioned so far is 'reverse fronting'. 'Fronting', where the main driver poses as an additional driver and nominates a less risky driver as the main driver, is illegal, but the reverse - adding a less risky driver as an additional driver - is legal and can sometimes reduce premiums. This is because only one of you can drive the car at any one time, and sometimes it'll be the less risky one. So, especially if you're male and aged < 25, see if adding your safest parent as a named driver makes a difference. If you have the choice of storing your car on a driveway or on the street, get quotes for both and see which is cheaper. If you live in an area where burglary is commonplace, thieves are more likely to steal cars left on driveways, as they can break into the owner's home and steal the keys. If not, the driveway is better, as it reduces the risk of a collision. If you have previously driven another vehicle (e.g. motorbike or moped), or if you've been insured as an additional driver on someone else's car, call up insurers directly and ask if they can offer you a no-claims bonus for this. Quotes from price comparison websites tend to limit you to the numbers of years of no-claims you've accrued as a main driver, and may not reflect your full available no-claims bonus. Extreme measures Some insurers give you the option to install a tracking device in your car that can tell them various things, e.g. Some people may be uncomfortable sharing this much information with their insurer, but for particularly risky drivers (I'm looking at you, males < 25) it can sometimes result in a substantial saving. One insurer that offers this is http://www.insurethebox.com/. Finally, if every insurer you can find is quoting in excess of £10,000 for a year's cover, you may find it cheaper instead to purchase a vintage agricultural vehicle and get it covered on a specialist farmer's policy: http://www.metro.co.uk/news/864501-teen-quoted-17k-for-car-insurance-resorts-to-driving-tractor" }, { "docid": "267422", "title": "", "text": "Credit history is local, so when you move to the US you start with the blank slate. Credit history length is a huge factor, so in the first year expect that nobody would trust you and you may be refused credit or asked for deposits. I was asked for deposits at cell phone company and refused for store cards couple of times. My advice - get a secured credit card (that means you put certain sum of money as a deposit in the bank and you get credit equal to that sum of money) and if you have something like a car loan that helps too (of course, you shouldn't buy a car just for that ;) but if you're buying anyway, just know it's not only hurting but also helping when you pay). Once you have a year or two of the history and you've kept with all the payments, you credit score would be OK and everybody would be happy to work with you. In 4-5 years you can have excellent credit record if you pay on time and don't do anything bad. If you are working it the US, a lot of help at first would be to take a letter from your company on an official letterhead saying that you are employed by this and that company and are getting salary of this and that. That can serve as an assurance for some merchants that otherwise would be reluctant to work with you because of the absence of credit history. If you have any assets overseas, especially if they are held in a branch of international bank in US dollars, that could help too. In general, don't count too much on credit for first 1-2 years (though you'd probably could get a car loan, for example, but rates would be exorbitant - easily 10 percentage points higher than with good credit), but it will get better soon." }, { "docid": "285669", "title": "", "text": "People can take off 15 minutes (some of my co worker even take off 1 hour early) early if they want as long as it didn't affect their works. They can also go to doctor appointment or any personal function if they tell their manager about it. Look, I don't know or care what you are trying to get it. If you are trying to imply that OMG! Euro is so much better than U.S. or whatever. I don't really care. I replied to your comment regarding working less than 40 hours as I stated it depend on the company that you work for. Good company doesn't care as long as it didn't affect your work. Regarding common/regular, yes. It is very common/regular in a good company. Like I said if you work for a shitty company. It doesn't matter where the company is located. US or otherwise." }, { "docid": "305539", "title": "", "text": "\"When you say that the problem is \"\"high supply but no demand\"\" you are actually correct. Here's why: The phrase \"\"borrow/spend less, save more\"\" isn't an absolute law. It's more of a cautionary tale. Obviously, spending is an integral part of an economy: it accounts for at least 50% of every transaction! But the aphorism is getting at something other than admonishing people to not spend. The point of the saying is that interest rates should reflect savings rates. What it comes down to is the how the law of supply and demand applies to the relationship between savings and interest rates. Consider this thought experiment: in a world where everybody saves 50% of their income, what would happen to interest rates? Banks would have a glut of savings, relative to the population. Assuming demand remains constant, interest rates would go down: the price of borrowing goes down as the supply of money to be borrowed increases. Thus a corollary of the law of supply and demand is that as savings increase, interest rates tend to go down. So, as savings increase, the economic environment encourages capital improvements. Businesses can borrow at lower rates and increase long-term productive capacity. This is what the federal reserve has attempted to do by lowering the Fed Funds rate to near zero and by Operation Twist: increase economic activity through low borrowing costs. So, what's the problem? When interest rates are artificially low there are no savings to support the production later in time. A company that borrows at a 1% rate created by the feds can build a factory to make widgets, but it will have a hard time selling that widget to a population with a negative net worth. However, if the 1% rate is \"\"natural\"\", then the company should be fine: the savings of the population should support the production from his widget factory. For about 30 years we have experienced a credit boom in this country that was not created by excess savings. This trend couldn't continue forever. Look around you. At the end of the day, an economy is simply a group of people getting together to buy and sell stuff and services. Right now there is a lot of debt, and little cash. Who will be doing the buying?\"" }, { "docid": "467341", "title": "", "text": "You're right, the issue of inversion is not going to go away as long as there are countries willing to go to 2% on their tax rate. But the goal isn't really to eliminate them it's to have a tax system and regulatory system which encourages healthy business growth and financial support to the government. The path the US has chosen is high corporate tax, cherry pick activities they want to encourage through breaks, then rely on taxing overseas profits on money returned to the US (since so many major companies are US based). This was a great system but its an anachronism since globalization became a real thing. Now what it has left us with is a tax incentive system where ONLY the business activities with breaks (RD tax credit) are considered worthwhile ventures while profit centers are offshored. Then no one can reinvest their profits in the US because they can't repatriate cash without paying tax. The corporate tax structure now hinders employment and investment. We don't need to lower our taxes to 0 to be competitive. The most popular countries for offshoring are Puerto Rico (pharma) Ireland and Switzerland their tax rates are effectively 0. However due to other costs (employment transportation of goods) on a total cost basis the US can be more than competitive with a corp tax rate of 20%." }, { "docid": "511647", "title": "", "text": "\"This page from TripAdvisor may be of interest. Look at what fees are charged on your ATM cards and credit cards, and consider overpaying your credit card so you have a credit balance that you can draw on for cash \"\"advances\"\" from ATMs that will dispense in local currency. Depending on what fees your bank charges, you may get a better rate than the forex cash traders at the airport. Edit: Cards may not always have the best rate. I recently heard from a traveler who was able to use a locally but not globally dominant currency to buy cash of a major currency at a shopping mall (with competitive forex traders) at rates even better than the mid-market rates posted at xe.com and similar places; I don't think you'll have that experience going from Australia to Malaysia (but another traveler reading this might have a different pair). In my experience the card rates are slightly worse than those and the airport forex traders significantly worse.\"" }, { "docid": "335531", "title": "", "text": "\"there is a problem with grouping them all as \"\"dismantling\"\" as many are overgrown and are wasteful. The EPA itself can not get out of it's own way. I worked on one project recently (2 years ago) where we were designing a counterflow cooling tower (huge AC for power plant) for Goose Creek SC where we were going to add another tower so that they could eventually switch to a close loop system (keeps all water in system, no dumping in river). the city of Goose Creek went to court because the EPA made a rule that by a certain date a company could no longer use an open system on a cooling tower if it dumped into a waterway. the city got their wish and they won and the EPA backed off and the town of Goose Creek gets to keep the dirty warm water that was (is) being dumped into the river so that the fishermen would have better catches (no shit, this is how it was and they wanted to keep it) they didn't want to chance losing the warm waters that drew more fish. Well, jokes on the town as we are now building a crossflow tower in that location that will have an open system to dump into the river. here's the catch, before it was to be a counterflow tower where the water must be better quality as the media in the tower could foul and impact the thermal rating of the tower, now they are going with a crossflow type tower and the media on those can accept the worst fucking water you can think of and still perform properly. so now the fishermen will get some nasty water that will be just below the allowable amount set by the EPA so that some lazy people can catch fish easier. that is what I consider a wasteful government program. but that is just my opinion, based on an interaction I had with a project where the EPA stuck there big head where they didnt even know what they were doing.\"" }, { "docid": "549665", "title": "", "text": "Why would a lender for a down payment want proof of income for a house when a credit card issuer gave me more and doesn't care? The risk profile and rate of interest are different. Could I use this argument as a basis that they have no reasoning to request proof of income, if another lender (credit card company) would give me more without proof of repayment? You could argue anything, but it does not mean the other company will agree with your argument. Should I borrow a home loan from a credit card company then? Or what's the catch here? You can. Check the rate of interest and penal fees; you would realize how much you will end up paying. Depending on the country, the difference could be in the region of 10-15%." }, { "docid": "442110", "title": "", "text": "75k is short of the 'highly compensated' category. Most US citizens in that pay range would consider paying someone to do their taxes as an unnecessary expense. Tax shelters usually don't come into play for this level of income. However, there are certain things which provide deductions. Some things that make it better to pay someone: Use the free online tax forms to sandbox your returns. If all you're concerned about is ensuring you pay your taxes correctly, this is the most cost efficient route. If you want to minimize your tax burden, consult with a CPA. Be sure to get one who is familiar with resident aliens from your country and the relevant tax treaties. The estimate you're looking at may be the withholding, of which you may be eligible for a refund for some part of that withholding. Tax treaties likely make sure that you get credit on each side for the money paid in the other. For example, as a US citizen, if I go to Europe and work and pay taxes there, I can deduct the taxes paid in Europe from my tax burden in the US. If I've already paid more to the EU than I would have paid on the same amount earned in the US, then my tax burden in the US is zero. By the same token, if I have not paid up to my US burden, then I owe the balance to the US. But this is way better than paying taxes to your home country and to the host country where you earned the money." }, { "docid": "202179", "title": "", "text": "\"I think the key point that's making the other commenters misunderstand each other here is the concept of \"\"deductions\"\". I can only speak for the UK, but that's only a concept that business owners would understand in this country. For things like child credits or low income tax credits, we don't get paid them at the end of the tax year, but into our bank accounts every couple of weeks all year round. Therefore, we have nothing to \"\"deduct\"\". If we work for a company and have business expenses, then the company pays for them. If we make interest on our savings, the bank pays it for us. We make money at our jobs, and the employer works out what taxes and national insurance we owe, based on a tax code that the government works out for us annually (which we can challenge). To be fair, it's not like we're free from bureaucracy if we want to claim these benefits. There are often lots of forms if you want child benefit or disability allowances, for instance. We just apply as soon as we're eligible, rather than waiting to get a lump sum rebate. So it appears to be a very different system, and neither is inherently better than the other (though I'm personally glad I don't usually have to fill in a big tax return myself, which I only did one year when I was self employed). I'd be interested to know, since Google has let me down, which countries use the American system, and which the British or Czech.\"" }, { "docid": "815", "title": "", "text": "\"I used to work for one of the three ratings agencies. Awhile ago. First: There are lots of different ratings. The bulk of ratings are for corporate debt and public finance. So senior debentures (fixed income) and General Obligations e.g. tax-free muni bonds, respectively. Ratings agencies are NOT paid by the investment banks, they are paid by the corporations or city/ state that is issuing debt. The investment banks are the syndicate that pulls the transaction together and brings it to market. For mortgage-backed securities, collateralized debt CDO-CLO's, all of which are fancy structured securitizations, well, that is a different matter! Those transactions are the ones where there is an inappropriately close tie between the investment bankers and ratings agencies. And those were the ratings that blew out and caused problems. Ratings agencies continued to do a decent job with what WAS their traditional business, corporate and municipal bond ratings, as far as I know. What khajja said was 100% correct: S&amp;P's fees were paid by investors, the people who were purchasing the bonds, until about 50 years ago. Around the same time that McGraw-Hill purchased S&amp;P, in 1966, they departed from that model, and started charging the bond issuers for ratings. I don't know if that decision was driven by McGraw-Hill or not, though. One more thing: Not all credit ratings agencies are paid by the issuers. One of the 10 NRSRO's (a designation given by the S.E.C.) is Egan-Jones. Their revenue comes from the investors, bond purchasers, not the companies issuing bonds, unlike the S&amp;P/ Fitch/ Moody's \"\"business model\"\". So there is an alternative, which I consider hopeful and reason not to totally despair. EDIT: What xcrunna19 mentions is also totally accurate. The part about Nouriel Roubini (who is a professor at N.Y.U. or Columbia or such and a sensible though slightly high strung sort) is consistent with my impression. As for whether it would require government action to implement the changes advocated by Roubini, yes, I guess it would, but I don't know if the government would do that. It would be better if the credit ratings agencies would find their own way to a different, less conflicted payment-incentive model. Keep in mind too that many of the provisions of Dodd-Frank have removed the existing regulatory requirements for credit ratings on bonds and other securities. This is the scary part though: There isn't anything to replace the credit ratings agencies, not at the moment, as far as I can tell! Eventually the government is supposed to come up with an alternative, but that hasn't happened yet. Which is better: Not requiring ratings at all, or the past situation of sometimes inflated ratings, which imparted a false sense of confidence? I don't know.\"" }, { "docid": "474173", "title": "", "text": "In USA, if you take a personal loan, you will probably get rates between 8-19%. It is better that you take a loan in India, as home loan rates are about 10.25%(10.15% is the lowest offered by SBI). This might not be part of the answer, but it is safer to hold USD than Indian rupees as India is inflating so much that the value of the rupee is always going lower(See 1970 when you could buy 1 dollar for 7 rupees). There might be price fluctuations where the rupee gains against the dollar, but in the long run, I think the dollar has much more value(Just a personal opinion). And since you are taking a home loan, I am assuming it will be somewhere between 10-20 years. So, you would actually save a lot more on the depreciating rupee, than you would pay interest. Yes, if you can get a home loan in USA at around 4%, it would definitely be worth considering, but I doubt they will do that since they would not know the actual value of the property. Coming to answer your question, getting a personal loan for 75k without keeping any security is highly unlikely. What you can do since you have a good credit score, is get a line of credit for 20-25k as a backup, and use that money to pay your EMI only when absolutely required. That way, you build your credit in the United States, and have a backup for around 2 years in India in case you fail to pay up. Moreover, Line of credits charge you interest only on the amount, you use. Cheers!" }, { "docid": "569207", "title": "", "text": "\"&gt;We also have the highest expenditures as a percent of GDP than any other nation. Needless to say we spend a LOT on health care also. That is in large part do to insane healthcare costs passed on to the consumers by the aca. Healthcare spending has increased on average 1.5% annually since 2009 where as the highest growth in spending from 1991 until 2006 was 1.3% (im willing to admit my research may be incomplete or inaccurate here as the available rescources are pretty limited in my short time researching) &gt;we do have arguably the best health care services in the world... that is mostly only true if you are very wealthy. Thats a dumb statement leftists make. There is no excuse to not put yourself in debt for the best healthcare possible. Idk about you but I'd rather be in a lot of debt getting first rate healthcare than get affordable care from a 2nd rate community college doctor. Did you also know that medical debt doesnt effect your credit score so even if you \"\"default\"\" on medical debts it doesnt effect any part of your life. so why wouldnt you go in debt and then slowly pay off that debt with no fear of negative repercussions for not paying? &gt;When you break it down on results per dollar spent, the US doesn't even break the top 20. When you break it down on infant mortality, and life expectancy, we have been on a backward slide for a while now (although those rates improved for the short while that the ACA has been in effect, as have the net increase in costs). At the end of the day, the cost of health care has grown 3X faster than inflation, and 20X faster than the average income for over 30 years now. So, no, health care in this country is not the best to the average person. I dont have health insurance and an ER visit with xrays costs me less out of pocket than 90% of the country why is that? Do you think it has to do with the fact that with the aca hospitals know they are getting paid with 0 questioning on pricing so charge whatever they want and with me they think \"\"shit this guy might not ever pay us lets just give him a decent price and get some money from him because all we can do is send his bill to collections\"\" you clearly dont know how the system works especially because you think its my responsibility to provide you with health insurance. You keep saying i need to travel and experience the world when all you need to do is go to google and look at what a wonderful job Switzerland does with their healthcare. The swiss do everything better, They have some of the best services in the world and a very affordable healthcare plan with many options that is affordable to the tax payers unlike the ACA. You have a very clear Scandinavian bias as im assuming you're a bernie supporter who loves democratic socialism despite all of its short comings. &gt;And yes, Space X has been able to estimate a savings of $300M less... Commercial does a great job of expanding on the research and knowledge that has come from government sponsored R&amp;D. You see that in every modern technological advancement - from the internet, cellular phones, GPS, medical procedures, etc. There are so many modern inventions that have sprung from government patents and government research programs. This is the dumbest statement youve made this entire time. The notion that inventions that were made on the governments dime (my dime) is somehow the product of the government is asinine at best. Youre operating under the assumption that these inventions wouldnt have been made without government funding which is false. They all would have been made on a smaller budget granted maybe a little bit further down the road but not by much considering technology has expanded (with no help from any government) more in the last 20 years than in the prior 200 because thats what technology does it makes life easier for everyone and almost innovates itself. Take apple for instance where is all the government funding they recieved to be one of the most innovative companies in human history or microsoft? Yiou can max 10 things government funding invented when i can walk into your house and point out 10000 things the government had no hand in at all.\"" }, { "docid": "493569", "title": "", "text": "Update, 2013: this product is no longer available. As of December 1, 2010, Travelex announced a product, the Travelex Cash Passport, which is chip-and-pin protected. You can buy it in the US and then load it up with either Euros or British Pounds. There are a few things to know about this: Right now, it is not available online at the Travelex website. You must purchase it in person at participating Travelex retail locations. I bought mine right downstairs from the Stack Overflow world headquarters! The fees that Travelex charges for foreign currency transactions will take your breath away. I purchased a £300 card for $547.15, which comes out to a 15% service charge. Travelex will give you better rates if you purchase larger amounts. There is a further 3% fee if you use a credit card (I used a debit card to avoid this). Think long and hard about whether to load it with Pounds or Euros. They charged me 5.5% above the interbank exchange rate to spend my Pound card in Euros. You get two cards, which is very convenient. You can refill the card on the web. Due to the high fees, the Chip and PIN Cash Passport is not a good idea for everyday transactions, for getting cash from an ATM, and certainly not for paying for big-ticket items like hotels. You're going to want to reserve it for purchasing things from those automated kiosks in Europe (especially gas stations, ticket machines in train stations, and toll booths) that will not work with a standard magnetic stripe card. The card worked perfectly buying tickets on the tube in London. I haven't had a chance to check it out in other countries." }, { "docid": "518402", "title": "", "text": "Yes you should take in the expenses being incurred by the mutual fund. This lists down the fees charged by the mutual fund and where expenses can be found in the annual statement of the fund. To calculate fees and expenses. As you might expect, fees and expenses vary from fund to fund. A fund with high costs must perform better than a low-cost fund to generate the same returns for you. Even small differences in fees can translate into large differences in returns over time. You don't pay expenses, so the money is taken from the assets of the fund. So you pay it indirectly. If the expenses are huge, that may point to something i.e. fund managers are enjoying at your expense, money is being used somewhere else rather than being paid as dividends. If the expenses are used in the growth of the fund, that is a positive sign. Else you can expect the fund to be downgraded or upgraded by the credit rating agencies, depending on how the credit rating agencies see the expenses of the fund and other factors. Generally comparison should be done with funds invested in the same sectors, same distribution of assets so that you have a homogeneous comparison to make. Else it would be unwise to compare between a fund invested in oil companies and other in computers. Yes the economy is inter twined, but that is not how a comparison should be done." }, { "docid": "310103", "title": "", "text": "\"It's generally not possible to open a business account in the UK remotely. It's even difficult (near impossible) for a non-resident (even if a citizen) to open a business or personal bank account while visiting the UK. A recent report says that it may be possible to open an account via Barclays Offshore in the Isle of Man. This requires a large deposit, and probably lots of paperwork and fees (most offshore locations have stricter \"\"know your customer\"\" rules than major countries). Note that while the Isle of Man is inside the UK banking system (for sort codes, account numbers), it is a separate territory that doesn't have the same deposit guarantees as the UK. There is no legal reason why a UK company has to bank within the UK banking system, although many companies paying the company would expect it or require it, and an account in anything other than sterling would complicate the accounts. It could have an account in your home country. It's not even a legal requirement that the company has an account in its own name at all. Some people use a (separate) personal account for this purpose. There are plenty of reasons why this is a bad idea (for example it's unclear who/what owns the money in the account, and can give the appearance of director's loans), but it's a work-around. Most inbound electronic payments only require a sort code and account number, the account owner name is not checked. The UK does have a much simpler and cheaper company registry than most European countries, but the near-impossibility of opening a bank account for a business in the UK as a non-resident has made it an unsuitable place to register a small international company.\"" }, { "docid": "77232", "title": "", "text": "Start with the bank where you have your checking and savings account. They can streamline some of the paperwork, because they can see how much you make, and have access to several years worth of bank statement. Legitimate mortgage companies do publish their rates. But there is no guarantee that you will qualify for the best rate without them knowing your credit score, salary, and down payment information. There is no way to know that you have the best rate because of the time lag involved. You will pick the best one you can work with, but the rates can change every day. Even when you lock in the rates, other companies can drift lower. Once you have started down the application process you will reach a point where switching companies will cost you time and money. Once you decide to purchase a house, the contract usually only gives you a few weeks to prove that you have financing in place. Therefore you will have to start the process before deciding on the house. Some advance work is needed to give you an idea of the maximum monthly payment you can afford, which will then based on the rate and down payment determine the maximum house you can buy. I have had good luck with my credit union, but there is no guarantee that yours will be competitive. Keep in mind that while rates are very important, some people also value customer service, and also like that the mortgage won't be sold to out of town investors." } ]

[ { "docid": "59686", "title": "", "text": "You're doing business in the US and derive income from the US, so I'd say that yes, you should file a non-resident tax return in the US. And in Connecticut, as well, since that's where you're conducting business (via your domestic LLC registered there). Since you paid more than $600 to your contractor, you're probably also supposed to send a 1099 to him on that account on behalf of your LLC (which is you, essentially, if you're the only member)." } ]

[ { "docid": "149577", "title": "", "text": "This is an 'Ordinary' bank account and not a NRO or NRI account, as I have a PAN card, Aadhar card etc and use an Indian address As you are NRI, you cannot hold an Ordinary Savings account in India. Please have this converted to NRO ASAP. It should be a simple paperwork. Will it be better and easier for my sister to transfer this inheritance money from my 'ordinary' bank account into her bank account and then have my sister 'Gift' me the money under LRS OR is it advisable to go through the lengthy procedure of opening NRO account, then filling in 15CB, 15CA, getting RBI permission and using form A2 to transfer the funds. If my sister transfers the money into her bank account, will this be considered as income for her and will she need to pay taxes on it (even though the money in my account is from inheritance). The right process would be to have your account converted to NRO, and complete the formality of 15CB, 15CA. There is no taxes if you transfer the funds to your sister and she transfers the funds back to you. From Indian Taxes point of view, this is gift between close relatives and there is no taxation." }, { "docid": "276411", "title": "", "text": "This is a complicated question that relies on the US-India Tax Treaty to determine whether the income is taxable to the US or to India. The relevant provision is likely Article 15 on Personal Services. http://www.irs.gov/pub/irs-trty/india.pdf It seems plausible that your business is personal services, but that's a fact-driven question based on your business model. If the online training is 'personal services' provided by you from India, then it is likely foreign source income under the treaty. The 'fixed base' and '90 days' provisions in Article 15 would not apply to an India resident working solely outside the US. The question is whether your US LLC was a US taxpayer. If the LLC was a taxpayer, then it has an obligation to pay US tax on any worldwide income and it also arguably disqualifies you from Article 15 (which applies to individuals and firms of individuals, but not companies). If you were the sole owner of the US LLC, and you did not make a Form 8832 election to be treated as subject to entity taxation, then the LLC was a disregarded entity. If you had other owners, and did not make an election, then you are a partnership and I suspect but cannot conclude that the treaty analysis is still valid. So this is fact-dependent, but you may be exempt from US tax under the tax treaty. However, you may have still had an obligation to file Forms 1099 for your worker. You can also late-file Forms 1099 reporting the nonemployee compensation paid to your worker. Note that this may have tax consequences on the worker if the worker failed to report the income in those years." }, { "docid": "14817", "title": "", "text": "\"All the other answers posted thus far discuss matters from the perspective of US tax laws and are unanimous in declaring that what the OP wants to do is indeed a very bad idea. I fully agree: it is a bad idea from the perspective of US tax laws, and is likely a bad idea from the perspective of Indian tax laws too, but what the OP wants to do is (or used to be) common practice in India. In more recent times, India has created a Permanent Account Number (\"\"PAN number\"\") for each taxpayer for income tax purposes, and each bank account or investment must have the owner's (or first-named owner's, in case of a joint account) PAN number associated with it. This most likely has decreased the popularity of such arrangements, or has led to new twists being used. The OP has not indicated the residence and citizenship of his family (or his own status for that matter), but if they are all Indian citizens resident in India and are Hindus, then there might be one mechanism for doing what the OP wants to do: apply for a PAN number in the name of the Hindu Undivided Family and use this number to carry out the investments in the name of the Hindu Undivided Family. (There presumably are similar statuses for undivided families for other religions, but I am not familiar with them). There are lots of matters here which are more legal questions than personal finance questions: e.g. if the OP is a US tax resident, then the family presumably will not be able to claim Hindu Undivided Family status since the OP has been divided from the family for tax purposes (or so I think). Even if HUF status is available, the OP might not be able to act as the pater familias while his father is alive, and so on. Consultation with tax lawyers, not just chartered accountants, in India is certainly advisable.\"" }, { "docid": "257168", "title": "", "text": "\"A tax return is a document you sign and file with the government to self-report your tax obligations. A tax refund is the payment you receive from the government if your payments into the tax system exceeded your obligations. As others have mentioned, if an extra $2K in income generated $5K in taxes, chances are your return was prepared incorrectly. The selection of an appropriate entity type for your business depends a lot on what you expect to see over the next several years in terms of income and expenses, and the extent to which you want or need to pay for fringe benefits or make pretax retirement contributions from your business income. There are four basic flavors of entity which are available to you: Sole proprietorship. This is the simplest option in terms of tax reporting and paperwork required for ongoing operations. Your net (gross minus expenses) income is added to your wage income and you'll pay tax on the total. If your wage income is less than approximately $100K, you'll also owe self-employment tax of approximately 15% in addition to income tax on your business income. If your business runs at a loss, you can deduct the loss from your other income in calculating your taxable income, though you won't be able to run at a loss indefinitely. You are liable for all of the debts and obligations of the business to the extent of all of your personal assets. Partnership. You will need at least two participants (humans or entities) to form a partnership. Individual items of income and expense are identified on a partnership tax return, and each partner's proportionate share is then reported on the individual partners' tax returns. General partners (who actively participate in the business) also must pay self-employment tax on their earnings below approximately $100K. Each general partner is responsible for all of the debts and obligations of the business to the extent of their personal assets. A general partnership can be created informally or with an oral agreement although that's not a good idea. Corporation. Business entities can be taxed as \"\"S\"\" or \"\"C\"\" corporations. Either way, the corporation is created by filing articles of incorporation with a state government (doesn't have to be the state where you live) and corporations are typically required to file yearly entity statements with the state where they were formed as well as all states where they do business. Shareholders are only liable for the debts and obligations of the corporation to the extent of their investment in the corporation. An \"\"S\"\" corporation files an information-only return similar to a partnership which reports items of income and expense, but those items are actually taken into account on the individual tax returns of the shareholders. If an \"\"S\"\" corporation runs at a loss, the losses are deductible against the shareholders' other income. A \"\"C\"\" corporation files a tax return more similar to an individual's. A C corporation calculates and pays its own tax at the corporate level. Payments from the C corporation to individuals are typically taxable as wages (from a tax point of view, it's the same as having a second job) or as dividends, depending on how and why the payments are made. (If they're in exchange for effort and work, they're probably wages - if they're payments of business profits to the business owners, they're probably dividends.) If a C corporation runs at a loss, the loss is not deductible against the shareholders' other income. Fringe benefits such as health insurance for business owners are not deductible as business expenses on the business returns for S corps, partnerships, or sole proprietorships. C corporations can deduct expenses for providing fringe benefits. LLCs don't have a predefined tax treatment - the members or managers of the LLC choose, when the LLC is formed, if they would like to be taxed as a partnership, an S corporation, or as a C corporation. If an LLC is owned by a single person, it can be considered a \"\"disregarded entity\"\" and treated for tax purposes as a sole proprietorship. This option is not available if the LLC has multiple owners. The asset protection provided by the use of an entity depends quite a bit on the source of the claim. If a creditor/plaintiff has a claim based on a contract signed on behalf of the entity, then they likely will not be able to \"\"pierce the veil\"\" and collect the entity's debts from the individual owners. On the other hand, if a creditor/plaintiff has a claim based on negligence or another tort-like action (such as sexual harassment), then it's very likely that the individual(s) involved will also be sued as individuals, which takes away a lot of the effectiveness of the purported asset protection. The entity-based asset protection is also often unavailable even for contract claims because sophisticated creditors (like banks and landlords) will often insist the the business owners sign a personal guarantee putting their own assets at risk in the event that the business fails to honor its obligations. There's no particular type of entity which will allow you to entirely avoid tax. Most tax planning revolves around characterizing income and expense items in the most favorable ways possible, or around controlling the timing of the appearance of those items on the tax return.\"" }, { "docid": "489790", "title": "", "text": "\"There is no penalty for foreigners but rather a 30% mandatory income tax withholding from distributions from 401(k) plans. You will \"\"get it back\"\" when you file the income tax return for the year and calculate your actual tax liability (including any penalties for a premature distribution from the 401(k) plan). You are, of course, a US citizen and not a foreigner, and thus are what the IRS calls a US person (which includes not just US citizens but permanent immigrants to the US as well as some temporary visa holders), but it is entirely possible that your 401(k) plan does not know this explicitly. This IRS web page tells 401(k) plan administrators Who can I presume is a US person? A retirement plan distribution is presumed to be made to a U.S. person only if the withholding agent: A payment that does not meet these rules is presumed to be made to a foreign person. Your SSN is presumably on file with the 401(k) plan administrator, but perhaps you are retired into a country that does not have an income tax treaty with the US and that's the mailing address that is on file with your 401(k) plan administrator? If so, the 401(k) administrator is merely following the rules and not presuming that you are a US person. So, how can you get around this non-presumption? The IRS document cited above (and the links therein) say that if the 401(k) plan has on file a W-9 form that you submitted to them, and the W-9 form includes your SSN, then the 401(k) plan has valid documentation to associate the distribution as being made to a US person, that is, the 401(k) plan does not need to make any presumptions; that you are a US person has been proved beyond reasonable doubt. So, to answer your question \"\"Will I be penalized when I later start a regular monthly withdrawal from my 401(k)?\"\" Yes, you will likely have mandatory 30% income tax withholding on your regular 401(k) distributions unless you have established that you are a US person to your 401(k) plan by submitting a W-9 form to them.\"" }, { "docid": "232563", "title": "", "text": "\"Yes, you can use a post office box as a business address but not as an address for your registered agent. Using your home address as the address of the business does not, to my knowledge, create a legal issue if you are sued. Your home is a personal asset, not one that belongs to the LLC, so it would not be subject to seizure or forfeiture as part of any lawsuit against the business itself. Every state requires an LLC or corporation to have a \"\"registered agent\"\" which, according to Wikipedia is: In United States business law, a registered agent, also known as a resident agent or statutory agent, is a business or individual designated to receive service of process (SOP) when a business entity is a party in a legal action such as a lawsuit or summons. You can be your own registered agent if you like. Companies that provide incorporation services will usually offer to act as a registered agent for your new business for a fee, but it's really no big deal. I would recommend that you go to the NoLo.com web site section about forming an LLC and take a look at their resources to help you through this. You need to do it right, so understand what you need to do for the state you live in, and take your time. If you rush it and screw it up then you might regret it later. I hope this helps Good luck!\"" }, { "docid": "32057", "title": "", "text": "You need to first visit the website of whatever state you're looking to rent the property in and you're going to want to form the LLC in that particular state. Find the Department of Licensing link and inquire about forming a standard LLC to register as the owner of the property and you should easily see how much it costs. If the LLC has no income history, it would be difficult for the bank to allow this without requiring you to personally guarantee the loan. The obvious benefit of protecting yourself with the LLC is that you protect any other personal assets you have in your name. Your liability would stop at the loan. The LLC would file its own taxes and be able to record the income against the losses (i.e. interest payments and other operating expenses.). This is can be beneficial depening on your current tax situation. I would definitely recommend the use of a tax accountant at that point. You need to be sure you can really afford this property in the worst case scenario and think about market leasing assumption, property taxes, maintenance and management (especially if you've moved to another state.)" }, { "docid": "34338", "title": "", "text": "\"If you live outside the US, then you probably need to deal with foreign tax credits, foreign income exclusions, FBAR forms (you probably have bank account balances enough for the 10K threshold) , various monsters the Congress enacted against you like form 8939 (if you have enough banking and investment accounts), form 3520 (if you have a IRA-like local pension), form 5471 (if you have a stake in a foreign business), form 8833 (if you have treaty claims) etc ect - that's just what I had the pleasure of coming across, there's more. TurboTax/H&R Block At Home/etc/etc are not for you. These programs are developed for a \"\"mainstream\"\" American citizen and resident who has nothing, or practically nothing, abroad. They may support the FBAR/FATCA forms (IIRC H&R Block has a problem with Fatca, didn't check if they fixed it for 2013. Heard reports that TurboTax support is not perfect as well), but nothing more than that. If you know the stuff well enough to fill the forms manually - go for it (I'm not sure they even provide all these forms in the software though). Now, specifically to your questions: Turbo tax doesn't seem to like the fact that my wife is a foreigner and doesn't have a social security number. It keeps bugging me to input a valid Ssn for her. I input all zeros for now. Not sure what to do. No, you cannot do that. You need to think whether you even want to include your wife in the return. Does she have income? Do you want to pay US taxes on her income? If she's not a US citizen/green card holder, why would you want that? Consider it again. If you decide to include here after all - you have to get an ITIN for her (instead of SSN). If you hire a professional to do your taxes, that professional will also guide you through the ITIN process. Turbo tax forces me to fill out a 29something form that establishes bonafide residency. Is this really necessary? Again in here it bugs me about wife's Ssn Form 2555 probably. Yes, it is, and yes, you have to have a ITIN for your wife if she's included. My previous state is California, and for my present state I input Foreign. When I get to the state tax portion turbo doesn't seem to realize that I have input foreign and it wants me to choose a valid state. However I think my first question is do i have to file a California tax now that I am not it's resident anymore? I do not have any assets in California. No house, no phone bill etc If you're not a resident in California, then why would you file? But you might be a partial resident, if you lived in CA part of the year. If so, you need to file 540NR for the part of the year you were a resident. If you have a better way to file tax based on this situation could you please share with me? As I said - hire a professional, preferably one that practices in your country of residence and knows the provisions of that country's tax treaty with the US. You can also hire a professional in the US, but get a good one, that specializes on expats.\"" }, { "docid": "241804", "title": "", "text": "my tax liabilities in India on my stock profit in US You would need to pay tax on the profit in India as well after you have become resident Indian. India and US have a double tax avoidance treaty. Hence if you have already paid tax in US, you can claim benefit and pay balance if any. For example if you US tax liability is 20 USD and Indian liability is USD 30, you just need to pay 10 USD. If the Indian tax liability is USD 20 or less you don't need to pay anything. what if in future I transfer all my US money to India? The funds you have earned in US while you were Non-Resident is tax free in India. You can bring it back any-time within a period of 7 years." }, { "docid": "362778", "title": "", "text": "The major reason to start an LLC for side work is if you want the additional personal liability protection afforded by one. If you're operating as a sole proprietor, you may be exposing yourself to liability: debts and judgments against your business can put your personal assets at risk! So, if you're intending to continue and grow your side work in the future, you ought to consider the LLC sooner than later. It's also an important legal decision and you should consider seeking a professional opinion. The Wall Street Journal has a brief guide titled How to Form an LLC. Here are some notable excerpts: A limited liability company, or LLC, is similar to a partnership but has the legal protections of personal assets that a corporation offers without the burdensome formalities, paperwork and fees. [...] Some states charge annual fees and taxes that can diminish the economic advantage of choosing to become an LLC. Among LLC advantages: pass-through taxation – meaning the profits and losses “pass through” the business to the individuals owning the business who report this information on their own personal tax returns. The result can be paying less in taxes, since profits are not taxed at both the business level and the personal level. Another plus: Owners aren’t usually responsible for the company’s debts and liabilities. [...] Also check out onstartups.com's Startup 101: Should You Form An Inc. or An LLC? Here are some additional articles that discuss the advantages / disadvantages of forming an LLC:" }, { "docid": "432562", "title": "", "text": "My wife and I are both Canadian citizens living in the US with green card status. I still have a Canadian RRSP and bank account in Canada that are dormant for the most part. We use the Canadian debit card only when traveling (which is quite helpful). Neither of us file any paperwork in Canada anymore. But as others have mentioned, we do file the FBAR form... this takes about 10 minutes and gets mailed somewhere in Michigan if I recall correctly. (Keep the balance less than $10k total among all foreign accounts and you relieve yourself of this too.) As far as taxes go, we make less interest in our Canadian account than in our US accounts, so the tax burden is less." }, { "docid": "129503", "title": "", "text": "\"You're conflating LLC with Corporation. They're different animals. LLC does not have \"\"S\"\" or \"\"C\"\" designations, those are just for corporations. I think what you're thinking about is electing pass through status with the IRS. This is the easiest way to go. The company can pay you at irregular intervals in irregular amounts. The IRS doesn't care about these payments. The company will show profit or loss at the end of the year (those payments to you aren't expenses and don't reduce your profit). You report this on your schedule C and pay tax on that amount. (Your state tax authority will have its own rules about how this works.) Alternatively you can elect to have the LLC taxed as a corporation. I don't know of a good reason why someone in your situation would do this, but I'm not an accountant so there may be reasons out there. My recommendation is to get an accountant to prepare your taxes. At least once -- if your situation is the same next year you can use the previous year's forms to figure out what you need to fill in. The investment of a couple hundred dollars is worthwhile. On the question of buying a home in the next couple of years... yes, it does affect things. (Pass through status? Probably doesn't affect much.) If all of your income is coming from self-employment, be prepared for hassles when you are shopping for a mortgage. You can ask around, maybe you have a friendly loan officer at your credit union who knows your history. But in general they will want to see at least two years of self-employment tax returns. You can plan for this in advance: talk to a couple of loan officers now to see what the requirements will be. That way you can plan to be ready when the time comes.\"" }, { "docid": "284805", "title": "", "text": "\"Others have given a lot of advice about how to invest, but as a former expat I wanted to throw this in: US citizens living and investing overseas can VERY easily run afoul of the IRS. Laws and regulations designed to prevent offshore tax havens can also make it very difficult for expats to do effective investing and estate planning. Among other things, watch out for: US citizens owe US income tax on world income regardless of where they live or earn money FBAR reporting requirements affect foreign accounts valued over $10k The IRS penalizes (often heavily) certain types of financial accounts. Tax-sheltered accounts (for education, retirement, etc.) are in the crosshairs, and anything the IRS deems a \"\"foreign-controlled trust\"\" is especially bad. Heavy taxes on investment not purchased from a US stock exchange Some US states will demand income taxes from former residents (including expats) who cannot prove residency in a different US state. I believe California is neutral in that regard, at least. I am neither a lawyer nor an accountant nor a financial advisor, so please take the above only as a starting point so you know what sorts of questions to ask the relevant experts.\"" }, { "docid": "44955", "title": "", "text": "Transferring money you own from one place to another pretty much never has tax implications. It might have other implications, including requirement to report it. Being a US citizen has tax implications, including the requirement to file US tax forms for the rest of eternity." }, { "docid": "131483", "title": "", "text": "The LLC will not be liable for anything, it is disregarded for tax purposes. If you're doing any work while in the US, or you (or your spouse) are a green card holder or a US citizen - then you (not the LLC) may be liable, may be required to file, pay, etc. Unless you're employing someone, or have more than one member in your LLC, you do not need an EIN. Re the bank - whatever you want. If you want you can open an account in an American bank. If you don't - don't. Who cares?" }, { "docid": "237514", "title": "", "text": "\"There are very few circumstances where forming an out of state entity is beneficial, but a website is within these circumstances in certain instances. Businesses with no physical operations do not need to care what jurisdiction they are registered in: your home state, a better united state or non-united state. The \"\"limited liability\"\" does it's job. If you are storing inventory or purchasing offices to compliment your online business, you need to register in the state those are located in. An online business is an example of a business with no physical presence. All states want you to register your LLC in the state that you live in, but this is where you need to read that state's laws. What are the consequences of not registering? There might be none, there might be many. In New York, for example, there are no consequences for not registering (and registering in new york - especially the city - is likely the most expensive in the USA). If your LLC needs to represent itself in court, New York provides retroactive foreign registrations and business licenses. So basically, despite saying that you need to pay over $1000 to form your LLC \"\"or else\"\", the reality is that you get the local limited liability protection in courts whenever you actually need it. Check your local state laws, but more times than not it is analogous to asking a barber if you need a haircut, the representative is always going to say \"\"yes, you do\"\" while the law, and associated case law, reveals that you don't. The federal government doesn't care what state your form an LLC or partnership in. Banks don't care what state you form an LLC or partnership in. The United States post office doesn't care. Making an app? The Apple iTunes store doesn't care. So that covers all the applicable authorities you need to consider. Now just go with the cheapest. In the US alone there are 50 states and several territories, all with their own fee structures, so you just have to do your research. Despite conflicting with another answer, Wyoming is still relevant, because it is cheap and has a mature system and laws around business entity formation. http://www.incorp.com has agents in every state, but there are registered agents everywhere, you can even call the Secretary of State in each state for a list of registered agents. Get an employer ID number yourself after the business entity is formed, it takes less than 5 minutes. All of this is also contingent on how your LLC or partnership distributes funds. If your LLC is not acting like a pass through entity to you and your partner,but instead holding its own profits like a corporation, then again none of this matters. You need to form it within the state you live and do foreign registrations in states where it has any physical presence, as it has becomes its own tax person in those states. This is relevant because you said you were trying to do something with a friend.\"" }, { "docid": "75195", "title": "", "text": "I have a very similar situation doing side IT projects. I set up an LLC for the business, created a separate bank account, and track things separately. I then pay myself from the LLC bank account based on my hours for the consulting job. (I keep a percentage in the LLC account to pay for expenses.) I used to do my taxes myself, but when I created this arrangement, I started having an accountant do them. An LLC will not affect your tax status, but it will protect you from liability and make things more accountable come tax time." }, { "docid": "366761", "title": "", "text": "I called the IRS (click here for IRS contact info) and they said I do not need to get a new EIN. I could have just filed the appropriate employer federal tax return (940/941) and then the filing requirements would have been updated. But while I was on the phone, they just updated the filing requirements for my LLC so I am all good now (I still need to file the correct form and make the correct payments, etc. but I can use this same EIN going forward). Disclaimer: Don't trust me (or this answer) for tax advice (your situation may be different). The IRS person on the phone was very helpful so I recommend calling them if you are in a similar situation. FYI, I have found calling the IRS to always be very helpful." }, { "docid": "347186", "title": "", "text": "Tax liability in US: You would need to determine if you are a resident alien or non resident alien. Resident alien are taxed normally as per US citizens. For the annual remuneration you have quoted it would be in the range of 25%. Refer http://www.moneychimp.com/features/tax_brackets.htm To determine if you are resident alien or non resident alien, you need to be present for certain period in US. There is also an exemption even if you meet this you can still be treated as non resident alien if your tax home is outside US [India in this case] Refer to the link for details to determine your category, the durations are for number of days in financial year, hence it matters when you are in US and the exact durations. http://www.irs.gov/taxtopics/tc851.html Also note that if you are assessed as resident alien, even the income from India will be taxed in US unless you declare there is no income in India. Tax liability in India: The tax liability in India would be depending on your NRI status. This again is tied to the financial year and the number of days you are in country. While the year you are going out of India you need to be away for atleast 183 days for you be considred are NRI. So if you are treated as Indian resident, you would have to pay tax in India on entire income. In the worst case, depending on the period you travel and the dates you travel, you could get classified as citizen in US as well as India and have to pay tax at both places. India and US do not have a dual tax avoidance treaty for individuals. Its there for certain category like small business and certain professions like teacher, research etc." } ]

[ { "docid": "276411", "title": "", "text": "This is a complicated question that relies on the US-India Tax Treaty to determine whether the income is taxable to the US or to India. The relevant provision is likely Article 15 on Personal Services. http://www.irs.gov/pub/irs-trty/india.pdf It seems plausible that your business is personal services, but that's a fact-driven question based on your business model. If the online training is 'personal services' provided by you from India, then it is likely foreign source income under the treaty. The 'fixed base' and '90 days' provisions in Article 15 would not apply to an India resident working solely outside the US. The question is whether your US LLC was a US taxpayer. If the LLC was a taxpayer, then it has an obligation to pay US tax on any worldwide income and it also arguably disqualifies you from Article 15 (which applies to individuals and firms of individuals, but not companies). If you were the sole owner of the US LLC, and you did not make a Form 8832 election to be treated as subject to entity taxation, then the LLC was a disregarded entity. If you had other owners, and did not make an election, then you are a partnership and I suspect but cannot conclude that the treaty analysis is still valid. So this is fact-dependent, but you may be exempt from US tax under the tax treaty. However, you may have still had an obligation to file Forms 1099 for your worker. You can also late-file Forms 1099 reporting the nonemployee compensation paid to your worker. Note that this may have tax consequences on the worker if the worker failed to report the income in those years." } ]

[ { "docid": "187706", "title": "", "text": "One other consideration. If you are a US citizen or Resident Alien, you are going to owe US income taxes regardless of where you earn the money. Here it is straight from the horse's mouth: Tax guide for US Citizens living abroad" }, { "docid": "173482", "title": "", "text": "Is there a limit on how much I can send? Can I send $100K plus? No. Yes. What is the most appropriate way to send money - international wire? Is there international-wire limit restrictions I need to be aware of? Yes. No. Is there any tax obligation should I be aware of when sending money home? If you're a US tax resident (which, as a US citizen, you are), you should be aware of gift tax rules. You'll probably want to talk to a licensed tax adviser (EA/CPA licensed in your state) and/or attorney, to understand the ramifications in full. If my family can return my money back in future, great, if not I really don't care, but when (if) I get my money back, will I have to pay taxes on bringing my own money back into US? No. But if you're giving it as a loan - you'll get paid interest which is taxable income to you. Is there anything else do I need to be aware of? The rules of the country which you're sending the money to." }, { "docid": "309684", "title": "", "text": "See if there are any favorable tax treaties between your two countries. (check US state department - or find the nearest PWC, Deloitte, KPMG, these are global auditing firms that deal with international tax and compliance) A tax treaty could have possible goodies such as a lower more favorable tax or even a tax credit from. For instance, if you paid 28% tax in the US then your new country will give you a credit on the taxes owed to them. The point of tax treaties are to prevent double taxation, but in the effort to do so they often create their own new tax rates for transfers between countries. You'll be better off just paying the 28% US income tax on your 401k distribution. And using the post-tax money as you please. US citizens are on the hook for income tax several years after they leave the US." }, { "docid": "420529", "title": "", "text": "I assume US as mhoran_psprep edited, although I'm not sure IRS necessarily means US. (It definitely used to also include Britain's Inland Revenue, but they changed.) (US) Stockbrokers do not normally withhold on either dividends/interest/distributions or realized capital gains, especially since gains might be reduced or eliminated by later losses. (They can be required to apply backup withholding to dividends and interest; don't ask how I know :-) You are normally required to pay most of your tax during the year, defined as within 10% or $1000 whichever is more, by withholding and/or estimated payments. Thus if the tax on your income including your recent gain will exceed your withholding by 10% and $1000, you should either adjust your withholding or make an estimated payment or some combination, although even if you have a job the last week of December is too late for you to adjust withholding significantly, or even to make a timely estimated payment if 'earlier in the year' means in an earlier quarter as defined for tax (Jan-Mar, Apr-May, June-Aug, Sept-Dec). See https://www.irs.gov/businesses/small-businesses-self-employed/estimated-taxes and for details its link to Publication 505. But a 'safe harbor' may apply since you say this is your first time to have capital gains. If you did not owe any income tax for last year (and were a citizen or resident), or (except very high earners) if you did owe tax and your withholding plus estimated payments this year is enough to pay last year's tax, you are exempt from the Form 2210 penalty and you have until the filing deadline (normally April 15 but this year April 18 due to weekend and holiday) to pay. The latter is likely if your job and therefore payroll income and withholding this year was the same or nearly the same as last year and there was no other big change other than the new capital gain. Also note that gains on investments held more than one year are classified as long-term and taxed at lower rates, which reduces the tax you will owe (all else equal) and thus the payments you need to make. But your wording 'bought and sold ... earlier this year' suggests your holding was not long-term, and short-term gains are taxed as 'ordinary' income. Added: if the state you live in has a state income tax similar considerations apply but to smaller amounts. TTBOMK all states tax capital gains (and other investment income, other than interest on exempt bonds), and don't necessarily give the lower rates for long-term gains. And all states I have lived in have 'must have withholding or estimated payments' rules generally similar to the Federal ones, though not identical." }, { "docid": "241804", "title": "", "text": "my tax liabilities in India on my stock profit in US You would need to pay tax on the profit in India as well after you have become resident Indian. India and US have a double tax avoidance treaty. Hence if you have already paid tax in US, you can claim benefit and pay balance if any. For example if you US tax liability is 20 USD and Indian liability is USD 30, you just need to pay 10 USD. If the Indian tax liability is USD 20 or less you don't need to pay anything. what if in future I transfer all my US money to India? The funds you have earned in US while you were Non-Resident is tax free in India. You can bring it back any-time within a period of 7 years." }, { "docid": "97852", "title": "", "text": "Legally, do I have anything to worry about from having an incorrectly filed W-4? What you did wasn't criminal. When you submitted the form it was correct. Unfortunately as your situation changed you didn't adjust the form, that mistake does have consequences. Is there anything within my rights I can do to get the company to take responsibility for their role in this situation, or is it basically my fault? It is basically your fault. The company needs a w-4 for each employee. They will use that W-4 for every paycheck until the government changes the regulation, or your employment ends, or you submit a new form. Topic 753 - Form W-4 – Employee's Withholding Allowance Certificate If an employee qualifies, he or she can also use Form W-4 (PDF) to tell you not to deduct any federal income tax from his or her wages. To qualify for this exempt status, the employee must have had no tax liability for the previous year and must expect to have no tax liability for the current year. However, if the employee can be claimed as a dependent on a parent's or another person's tax return, additional limitations may apply; refer to the instructions for Form W-4. A Form W-4 claiming exemption from withholding is valid for only the calendar year in which it is filed with the employer. To continue to be exempt from withholding in the next year, an employee must give you a new Form W-4 claiming exempt status by February 15 of that year. If the employee does not give you a new Form W-4, withhold tax as if he or she is single, with no withholding allowances. However, if you have an earlier Form W-4 (not claiming exempt status) for this employee that is valid, withhold as you did before. (I highlighted the key part) Because you were claiming exempt they should have required you to update that form each year. In your case that may not have applied because of the timing of the events. When do you submit a new form? Anytime your situation changes. Sometimes the change is done to adjust withholding to modify the amount of a refund. Other times failure to update the form can lead to bigger complication: when your marital status changes, or the number of dependents changes. In these situations you could have a significant amount of under-withheld, which could lead to a fine later on. As a side note this is even more true for the state version of a W-4. Having a whole years worth of income tax withholding done for the wrong state will at a minimum require you to file in multiple states, it could also result in a big surprise if the forgotten state has higher tax rate. Will my (now former) employee be responsible for paying their portion of the taxes that were not withheld during the 9 months I was full-time, tax Exempt? For federal and state income taxes they are just a conduit. They take the money from your paycheck, and periodically send it to the IRS and the state capital. Unless you could show that the pay stubs said taxes were being withheld, but the w-2 said otherwise; they have no role in judging the appropriateness of your W-4 with one exception. Finally, and I am not too hopeful on this one, but is there anything I can do to ease this tax burden? I understand that the IRS is owed no matter what. You have one way it might workout. For many taxpayers who have a large increase in pay from one year to the next, they can take advantage of a safe-harbor in the tax law. If they had withheld as much money in 2015 as they paid in 2014, they have reached the safe-harbor. They avoid the penalty for under withholding. Note that 2014 number is not what you paid on tax day or what was refunded, but all your income taxes for the entire year. Because in your case your taxes for the year 2014 were ZERO, that might mean that you automatically reach the safe-harbor for 2015. That makes sense because one of the key requirements of claiming exempt is that you had no liability the year before. It won't save you from paying what you owe but it can help avoid a penalty. Lessons" }, { "docid": "565296", "title": "", "text": "You have left out the most important piece of information: are you an American citizen? If you are, then PFIC rules mean you need to be very careful not to invest in any foreign index funds/ETFs. That means it will probably be easiest for you to just leave the money in the US and continue to invest it there. If you do not have US citizenship, and have never had a green card, then you will qualify for non-resident alien status after you've been gone for 3 years. Once that happens, you won't owe US capital gains tax (though you will owe it in AUS). You will owe 30% tax on dividends, though. Much more at Investopedia." }, { "docid": "317529", "title": "", "text": "\"My tax preparing agent is suggesting that since the stock brokers in India does not have any US state ITINS, it becomes complicated to file that income along with US taxes Why? Nothing to do with each other. You need to have ITIN (or, SSN more likely, since you're on H1b). What brokers have have nothing to do with you. You must report these gains on your US tax return, and beware of the PFIC rules when you do it. He says, I can file those taxes separately in India. You file Indian tax return in India, but it has nothing to do with the US. You'll have to deal with the tax treaty/foreign tax credits to co-ordinate. How complicated is it to include Indian capital gains along with US taxes? \"\"How complicated\"\" is really irrelevant. But in any case - there's no difference between Indian capital gains and American capital gains, unless PFIC/Trusts/Mutual funds are involved. Then it becomes complicated, but being complicated is not enough to not report it. If PIFC/Trusts/Mutual funds aren't involved, you just report this on Schedule D as usual. Did anybody face similar situation More or less every American living abroad. Also the financial years are different in India and US Irrelevant.\"" }, { "docid": "32057", "title": "", "text": "You need to first visit the website of whatever state you're looking to rent the property in and you're going to want to form the LLC in that particular state. Find the Department of Licensing link and inquire about forming a standard LLC to register as the owner of the property and you should easily see how much it costs. If the LLC has no income history, it would be difficult for the bank to allow this without requiring you to personally guarantee the loan. The obvious benefit of protecting yourself with the LLC is that you protect any other personal assets you have in your name. Your liability would stop at the loan. The LLC would file its own taxes and be able to record the income against the losses (i.e. interest payments and other operating expenses.). This is can be beneficial depening on your current tax situation. I would definitely recommend the use of a tax accountant at that point. You need to be sure you can really afford this property in the worst case scenario and think about market leasing assumption, property taxes, maintenance and management (especially if you've moved to another state.)" }, { "docid": "254158", "title": "", "text": "The LLC will file its own business taxes which may or may not have business level income and expenses. At the end, the LLC will issue Schedule K-1 tax forms to the members, that based on their percentage ownership, will reflect the percentage share of the income/losses. From an individual standpoint, the members need only worry about the K-1 form they receive. This has quite a few pass-through categories from the LLC, but the Income/Loss may be the only used one. The individual will likely include the K-1 by filing a Schedule-E along with their 1040 form. The 1040 Schedule-E has some ability to deduct expenses as an individual. Generally it's best not to commingle expenses. Additional schedule-E expense reporting is generally for non-reimbursed, but related business expenses. If a member paid certain fees for the LLC, it is better for the LLC to reimburse him and then deduct the expense properly. Schedule-E is on a non-LLC, personal level." }, { "docid": "547301", "title": "", "text": "\"Like you said, it's important to keep your personal assets and company assets completely separate to maintain the liability protection of the LLC. I'd recommend getting the business bank account right from the beginning. My wife formed an LLC last year (also as a pass-through sole proprietorship for tax purposes), and we were able to get a small business checking account from Savings Institute and Trust that has no fees (at least for the relatively low quantity of transactions we'll be doing). We wrote it a personal check for startup capital, and since then, the LLC has paid all of its own bills out of its checking account (with associated debit card). Getting the account opened took less than an hour of sitting at the bank. Without knowing exactly where you are in Kentucky, I note that Googling \"\"kentucky small business checking\"\" and visiting a few banks' web sites provided several promising options for no-fee business checking.\"" }, { "docid": "131483", "title": "", "text": "The LLC will not be liable for anything, it is disregarded for tax purposes. If you're doing any work while in the US, or you (or your spouse) are a green card holder or a US citizen - then you (not the LLC) may be liable, may be required to file, pay, etc. Unless you're employing someone, or have more than one member in your LLC, you do not need an EIN. Re the bank - whatever you want. If you want you can open an account in an American bank. If you don't - don't. Who cares?" }, { "docid": "260603", "title": "", "text": "\"The \"\"independent contractor\"\" vs. \"\"employee\"\" distinction is a red herring to this discussion and not at all important just because someone suggested you use your LLC to do the job. Corp-2-Corp is a very common way to do contracting and having an LLC with business bank accounts provides you with more tax deductions (such as deducting interest on credit lines). Some accounting practices prefer to pay entities by their Tax ID numbers, instead of an individual's social security number. The actual reasoning behind this would be dubious, but the LLC only benefits you and gives you more advantages by having one than not. For example, it is easier for you to hire subcontractors through your LLC to assist with your job, due to the opaqueness of the private entity. Similarly, your LLC can sign Non Disclosure and Intellectual Property agreements, automatically extending the trade secrets to all of its members, as opposed to just you as an individual. By signing whatever agreement with the company that is paying you through your LLC, your LLC will be privy to all of this. Next, assuming you did have subcontractors or other liability inducing assets, the LLC limits the liability you personally have to deal with in a court system, to an extent. But even if you didn't, the facelessness of an LLC can deter potential creditors, for example, your client may just assume you are a cog in a wheel - a random employee of the LLC - as opposed to the sole owner. Having a business account for the LLC keeps all of your expenses in one account statement, making your tax deductions easier. If you had a business credit line, the interest is tax deductible (compared to just having a personal credit card for business purposes). Regarding the time/costs of setting up and managing an LLC, this does vary by jurisdiction. It can negligible, or it can be complex. You also only have to do it once. Hire an attorney to give you a head start on that, if you feel that is necessary. Now back to the \"\"independent contractor\"\" vs. \"\"employee\"\" distinction: It is true that the client will not be paying your social security, but they expect you to charge more hourly than an equivalent actual employee would, solely because you don't get health insurance from them or paid leave or retirement plans or any other perk, and you will receive the entire paycheck without any withheld by the employer. You also get more tax deductions to utilize, although you will now have self employment tax (assuming you are a US citizen), this becomes less and less important the higher over $105,000 you make, as it stops being counted (slightly more complicated than that, but self employment tax is it's own discussion).\"" }, { "docid": "14817", "title": "", "text": "\"All the other answers posted thus far discuss matters from the perspective of US tax laws and are unanimous in declaring that what the OP wants to do is indeed a very bad idea. I fully agree: it is a bad idea from the perspective of US tax laws, and is likely a bad idea from the perspective of Indian tax laws too, but what the OP wants to do is (or used to be) common practice in India. In more recent times, India has created a Permanent Account Number (\"\"PAN number\"\") for each taxpayer for income tax purposes, and each bank account or investment must have the owner's (or first-named owner's, in case of a joint account) PAN number associated with it. This most likely has decreased the popularity of such arrangements, or has led to new twists being used. The OP has not indicated the residence and citizenship of his family (or his own status for that matter), but if they are all Indian citizens resident in India and are Hindus, then there might be one mechanism for doing what the OP wants to do: apply for a PAN number in the name of the Hindu Undivided Family and use this number to carry out the investments in the name of the Hindu Undivided Family. (There presumably are similar statuses for undivided families for other religions, but I am not familiar with them). There are lots of matters here which are more legal questions than personal finance questions: e.g. if the OP is a US tax resident, then the family presumably will not be able to claim Hindu Undivided Family status since the OP has been divided from the family for tax purposes (or so I think). Even if HUF status is available, the OP might not be able to act as the pater familias while his father is alive, and so on. Consultation with tax lawyers, not just chartered accountants, in India is certainly advisable.\"" }, { "docid": "478408", "title": "", "text": "\"My employer decided to pay my salary in India after I submit a form W-8BEN. This means that the wages / salary is deemed accrued for work from India. Hence your employer need not withhold and pay taxes on this wage in US. Is this payment taxable in the States since I am staying outside of States? Should I declare this income to IRS in case if I go back to the States later this year? No tax is due as the work is done outside on US. If you go back this would be similar to as you had gone first. Depending on your \"\"tax residency status\"\" you would have to declare all assets. If my US employer wires my US salary to my NRE account is that taxable in India? This is still taxable in India. It is advised that you have the funds transferred into a regular savings account. Please note you have to pay taxes in advance as per prescribed due dates in Sept, Dec, March. how does the Indian tax man identify if it is a taxable income and not just the regular remittance. This question is off topic here. Whether income taxes finds out about this is irrelevant. By law one is required to pay taxes on income earned in India.\"" }, { "docid": "381884", "title": "", "text": "IANAL, I am married to someone in your situation. As a US citizen age 26 who has not had any contact with the IRS, you should most definitely be worried... As a US citizen, you are (and always have been) required to file a US tax return and pay any tax on all income, no matter where earned, and no matter where you reside. There are often (but not always) agreements between governments to reduce double taxation. The US rule as to whether a particular type of income is taxable will prevail. As a US citizen with financial accounts (chequing, saving, investment, etc.) above a minimum balance, abroad, you are required to report information, including the amounts in the account, to the US government annually (Look up FBAR). Failure to file these forms carries harsh penalties. A recent law (FATCA) requires foreign financial institutions to report information on their US citizen clients to the US, irrespective of any local banking privacy laws. It's possible that your application triggered these reporting requirements. You will not be allowed to renounce your US citizenship until you have paid all past US taxes and penalties. Good new: you are eligible in ten years or so to run for President. Don't believe any of this, or that nothing has been missed; you must consult with a local tax expert specializing in US/UK tax laws." }, { "docid": "237514", "title": "", "text": "\"There are very few circumstances where forming an out of state entity is beneficial, but a website is within these circumstances in certain instances. Businesses with no physical operations do not need to care what jurisdiction they are registered in: your home state, a better united state or non-united state. The \"\"limited liability\"\" does it's job. If you are storing inventory or purchasing offices to compliment your online business, you need to register in the state those are located in. An online business is an example of a business with no physical presence. All states want you to register your LLC in the state that you live in, but this is where you need to read that state's laws. What are the consequences of not registering? There might be none, there might be many. In New York, for example, there are no consequences for not registering (and registering in new york - especially the city - is likely the most expensive in the USA). If your LLC needs to represent itself in court, New York provides retroactive foreign registrations and business licenses. So basically, despite saying that you need to pay over $1000 to form your LLC \"\"or else\"\", the reality is that you get the local limited liability protection in courts whenever you actually need it. Check your local state laws, but more times than not it is analogous to asking a barber if you need a haircut, the representative is always going to say \"\"yes, you do\"\" while the law, and associated case law, reveals that you don't. The federal government doesn't care what state your form an LLC or partnership in. Banks don't care what state you form an LLC or partnership in. The United States post office doesn't care. Making an app? The Apple iTunes store doesn't care. So that covers all the applicable authorities you need to consider. Now just go with the cheapest. In the US alone there are 50 states and several territories, all with their own fee structures, so you just have to do your research. Despite conflicting with another answer, Wyoming is still relevant, because it is cheap and has a mature system and laws around business entity formation. http://www.incorp.com has agents in every state, but there are registered agents everywhere, you can even call the Secretary of State in each state for a list of registered agents. Get an employer ID number yourself after the business entity is formed, it takes less than 5 minutes. All of this is also contingent on how your LLC or partnership distributes funds. If your LLC is not acting like a pass through entity to you and your partner,but instead holding its own profits like a corporation, then again none of this matters. You need to form it within the state you live and do foreign registrations in states where it has any physical presence, as it has becomes its own tax person in those states. This is relevant because you said you were trying to do something with a friend.\"" }, { "docid": "257168", "title": "", "text": "\"A tax return is a document you sign and file with the government to self-report your tax obligations. A tax refund is the payment you receive from the government if your payments into the tax system exceeded your obligations. As others have mentioned, if an extra $2K in income generated $5K in taxes, chances are your return was prepared incorrectly. The selection of an appropriate entity type for your business depends a lot on what you expect to see over the next several years in terms of income and expenses, and the extent to which you want or need to pay for fringe benefits or make pretax retirement contributions from your business income. There are four basic flavors of entity which are available to you: Sole proprietorship. This is the simplest option in terms of tax reporting and paperwork required for ongoing operations. Your net (gross minus expenses) income is added to your wage income and you'll pay tax on the total. If your wage income is less than approximately $100K, you'll also owe self-employment tax of approximately 15% in addition to income tax on your business income. If your business runs at a loss, you can deduct the loss from your other income in calculating your taxable income, though you won't be able to run at a loss indefinitely. You are liable for all of the debts and obligations of the business to the extent of all of your personal assets. Partnership. You will need at least two participants (humans or entities) to form a partnership. Individual items of income and expense are identified on a partnership tax return, and each partner's proportionate share is then reported on the individual partners' tax returns. General partners (who actively participate in the business) also must pay self-employment tax on their earnings below approximately $100K. Each general partner is responsible for all of the debts and obligations of the business to the extent of their personal assets. A general partnership can be created informally or with an oral agreement although that's not a good idea. Corporation. Business entities can be taxed as \"\"S\"\" or \"\"C\"\" corporations. Either way, the corporation is created by filing articles of incorporation with a state government (doesn't have to be the state where you live) and corporations are typically required to file yearly entity statements with the state where they were formed as well as all states where they do business. Shareholders are only liable for the debts and obligations of the corporation to the extent of their investment in the corporation. An \"\"S\"\" corporation files an information-only return similar to a partnership which reports items of income and expense, but those items are actually taken into account on the individual tax returns of the shareholders. If an \"\"S\"\" corporation runs at a loss, the losses are deductible against the shareholders' other income. A \"\"C\"\" corporation files a tax return more similar to an individual's. A C corporation calculates and pays its own tax at the corporate level. Payments from the C corporation to individuals are typically taxable as wages (from a tax point of view, it's the same as having a second job) or as dividends, depending on how and why the payments are made. (If they're in exchange for effort and work, they're probably wages - if they're payments of business profits to the business owners, they're probably dividends.) If a C corporation runs at a loss, the loss is not deductible against the shareholders' other income. Fringe benefits such as health insurance for business owners are not deductible as business expenses on the business returns for S corps, partnerships, or sole proprietorships. C corporations can deduct expenses for providing fringe benefits. LLCs don't have a predefined tax treatment - the members or managers of the LLC choose, when the LLC is formed, if they would like to be taxed as a partnership, an S corporation, or as a C corporation. If an LLC is owned by a single person, it can be considered a \"\"disregarded entity\"\" and treated for tax purposes as a sole proprietorship. This option is not available if the LLC has multiple owners. The asset protection provided by the use of an entity depends quite a bit on the source of the claim. If a creditor/plaintiff has a claim based on a contract signed on behalf of the entity, then they likely will not be able to \"\"pierce the veil\"\" and collect the entity's debts from the individual owners. On the other hand, if a creditor/plaintiff has a claim based on negligence or another tort-like action (such as sexual harassment), then it's very likely that the individual(s) involved will also be sued as individuals, which takes away a lot of the effectiveness of the purported asset protection. The entity-based asset protection is also often unavailable even for contract claims because sophisticated creditors (like banks and landlords) will often insist the the business owners sign a personal guarantee putting their own assets at risk in the event that the business fails to honor its obligations. There's no particular type of entity which will allow you to entirely avoid tax. Most tax planning revolves around characterizing income and expense items in the most favorable ways possible, or around controlling the timing of the appearance of those items on the tax return.\"" }, { "docid": "432562", "title": "", "text": "My wife and I are both Canadian citizens living in the US with green card status. I still have a Canadian RRSP and bank account in Canada that are dormant for the most part. We use the Canadian debit card only when traveling (which is quite helpful). Neither of us file any paperwork in Canada anymore. But as others have mentioned, we do file the FBAR form... this takes about 10 minutes and gets mailed somewhere in Michigan if I recall correctly. (Keep the balance less than $10k total among all foreign accounts and you relieve yourself of this too.) As far as taxes go, we make less interest in our Canadian account than in our US accounts, so the tax burden is less." } ]

[ { "docid": "263485", "title": "", "text": "IRS pub 521 has all the information you need. Expenses reimbursed. If you are reimbursed for your expenses and you use the cash method of accounting, you can deduct your expenses either in the year you paid them or in the year you received the reimbursement. If you use the cash method of accounting, you can choose to deduct the expenses in the year you are reimbursed even though you paid the expenses in a different year. See Choosing when to deduct, next. If you deduct your expenses and you receive the reimbursement in a later year, you must include the reimbursement in your income on Form 1040, line 21 This is not unusual. Anybody who moves near the end of the year can have this problem. The 39 week time test also can be an issue that span over 2 tax years. I would take the deduction for the expenses as soon a I could, and then count the income in the later year if they pay me back. IF they do so before April 15th, then I would put them on the same tax form to make things easier." } ]

[ { "docid": "37306", "title": "", "text": "\"I used Quicken, so this may or may not be helpful. I have a Cash account that I call \"\"Temporary Assets and Liabilities\"\" where I track money that I am owed (or that I owe in some cases). So if I pay for something that is really not my expense, it is transferred to this account (\"\"transferred\"\" in Quicken terms). The payment is then not treated as an expense and the reimbursement is not treated as income--the two transactions just balance out.\"" }, { "docid": "174714", "title": "", "text": "\"When you pay the flight, hotel, conference attendance fees of $100: When you repay the credit card debt of $100: When you receive the gross salary of $5000: Your final balance sheet will show: Your final income statement will show: Under this method, your \"\"Salary\"\" account will show the salary net of business expense. The drawback is that the $4900 does not agree with your official documentation. For tax reporting purposes, you report $5000 to the tax agency, and if possible, report the $100 as Unreimbursed Employee Expenses (you weren't officially reimbursed). For more details see IRS Publication 529.\"" }, { "docid": "474057", "title": "", "text": "You will need to look at the 27.5 year depreciation table from the IRS. It tells you how you will be able to write off the first year. It depends on which month you had the unit ready to rent. Note that that it might be a different month from when you moved, or when the first tenant moved in. Your list is pretty good. You can also claim some travel expenses or mileage related to the unit. Also keep track of any other expenses such as switching the water bill to the new renter, or postage. If you use Turbo tax, not the least expensive version, it can be a big help to get started and to remember how much to depreciate each year." }, { "docid": "410226", "title": "", "text": "HSA rules are different in some regards than deductions allowable under Pub 502 which deals with medical expenses deductible in Schedule A of your tax return. Pub 969 governs HSA's and similar reimbursement plans, and the guidelines are as follows: Insurance premiums. You can’t treat insurance premiums as qualified medical expenses unless the premiums are for: -Long-term care insurance. -Health care continuation coverage (such as coverage under COBRA). -Health care coverage while receiving unemployment compensation under federal or state law. -Medicare and other health care coverage if you were 65 or older (other than premiums for a Medicare supplemental policy, such as Medigap). Since your wife is still being treated like an employee for health benefits, and you are not on COBRA, thus not eligible for a deduction. You may qualify under the unemployment provision depending on the cause of her disability." }, { "docid": "41793", "title": "", "text": "\"You can deduct what you pay for your own and your family's health insurance regardless of whether it is subsidized by your employer or not, as well as all other medical and dental expenses for your family, as an itemized deduction on Schedule A of Form 1040, but only to the extent that the total exceeds 7.5% of your Adjusted Gross Income (AGI) (10% on tax returns for year 2013 onwards). As pointed out in KeithB's comment, you cannot deduct any health insurance premium (or other medical expense) that was paid for out of pre-tax dollars, nor indeed can you deduct any medical expense to the extent that it was paid for by the insurance company directly to hospital or doctor (or reimbursed to you) for a covered expense; e.g. if the insurance company reimbursed you $72 for a claim for a doctor's visit for which you paid $100 to the doctor, only $28 goes on Schedule A to be added to the amount that you will be comparing to the 7.5% of AGI threshold, and the $72 is not income to you that needs to be reported on Form 1040. Depending on other items on Schedule A, your total itemized deductions might not exceed the standard deduction, in which case you will likely choose to use the standard deduction. In this case, you \"\"lose\"\" the deduction for medical expenses as well as all other expenses deductible on Schedule A. Summary of some of the discussions in the comments Health care insurance premiums cannot be paid for from HSA accounts (IRS Pub 969, page 8, column 2, near the bottom) though there are some exceptions. Nor can health care insurance premiums be paid from an FSA account (IRS Pub 969, page 17, column 1, near the top). If you have a business on the side and file a Schedule C as a self-employed person, you can buy medical insurance for that business's employees (and their families too, if you like) as an employment benefit, and pay for it out of the income of the Schedule C business, (thus saving on taxes). But be aware that if you have employees other than yourself in the side business, they would need to be covered by the same policy too. You can even decide to pay all medical expenses of your employees and their families too (no 7.5% limitation there!) as an employment benefit but again, you cannot discriminate against other employees (if any) of the Schedule C business in this matter. Of course, all this money that reduced your Schedule C income does not go on Schedule A at all. If your employer permits your family to be covered under its health insurance plan (for a cost, of course), check whether you are allowed to pay for the insurance with pre-tax dollars. The private (non-Schedule C) insurance would, of course, be paid for with post-tax dollars. I would doubt that you would be able to save enough money on taxes to make up the difference between $1330/month and $600/month, but it might also be that the private insurance policy covers a lot less than your employer's policy does. As a rule of thumb, group insurance through an employer can be expected to offer better coverage than privately purchased insurance. Whether the added coverage is worth the additional cost is a different matter. But while considering this matter, keep in mind that privately purchased insurance is not always guaranteed to be renewable, and a company might decline to renew a policy if there were a large number of claims. A replacement policy might not cover pre-existing conditions for some time (six months? a year?) or maybe even permanently. So, do consider these aspects as well. Of course, an employer can also change health insurance plans or drop them entirely as an employment benefit (or you might quit and go work for a different company), but as long as the employer's health plan is in existence, you (and continuing members of your family) cannot be discriminated against and denied coverage under the employer's plan.\"" }, { "docid": "551864", "title": "", "text": "\"In general, you are allowed to deduct up to $50/month per student (see page 4), but only if you aren't reimbursed. In your case, since you are receiving a stipend, the full $2000 will be treated as taxable income. But the question of \"\"is it worth it\"\" really depends on how much you will actually spend (and also what you'll get from the experience). Suppose you actually spend $1000/month to host them, and if your combined tax rate is 35%, you'll pay $700 in additional taxes each month, but you'll still profit $300 each month. If your primary motivation for hosting students is to make a profit, you could consider creating a business out of it. If you do that you will be able to deduct all of your legitimate business expenses which, in the above example, would be $1000/month. Keeping with that example, you would now pay taxes on $1000 instead of $2000, which would be $350, meaning your profit would now be $650/month. (Increasing your profit by $350/month.) You will only need to keep spending records if you plan to go the business route. My advice: assume you won't be going the business route, and then figure out what your break even point is based on your tax rate (Fed+state+FICA). The formula is: Max you can spend per month without losing money = 2000 - (2000 * T) e.g. if T = 35%, the break even point is $1300. Side note: My family hosted 5 students in 5 years and it was always a fantastic experience. But it is also a very big commitment. Teenagers eat a lot, and they drive cars, and go on dates, and play sports, and need help with their homework (especially English papers), and they don't seem to like bed times or curfews. IMHO it's totally worth it, even without the stipend...\"" }, { "docid": "345274", "title": "", "text": "As the answer from Guest5 noted, any expense you have before the HSA is established is not considered a qualified medical expense for an HSA distribution. However, it is important to note that since you now have the HSA established, any medical expense you have from this point on is a qualified medical expense, even if you don't take an HSA distribution for it right away. For example, let's say that you have a medical expense this year, but you don't take an HSA distribution to reimburse yourself right away. (Maybe it is because you don't have enough money in your HSA to reimburse yourself at this time.) You can reimburse yourself in the future for this expense. As long as you had an HSA in place when the expense was incurred, it doesn't matter if you wait to take the distribution." }, { "docid": "338700", "title": "", "text": "It sounds like something is getting lost in translation here. A business owner should not have to pay personal income tax on business expenses, with the caveat that they are truly business expenses. Here's an example where what you described could happen: Suppose a business has $200K in revenue, and $150K in legitimate business expenses (wages and owner salaries, taxes, services, products/goods, etc.) The profit for this example business is $50K. Depending on how the business is structured (sole proprietor, llc, s-corp, etc), the business owner(s) may have to pay personal income tax on the $50K in profit. If the owner then decided to have the business purchase a new vehicle solely for personal use with, say, $25K of that profit, then the owner may think he could avoid paying income tax on $25K of the $50K. However, this would not be considered a legitimate business expense, and therefore would have to be reclassified as personal income and would be taxed as if the $25K was paid to the owner. If the vehicle truly was used for legitimate business purposes then the business expenses would end up being $175K, with $25K left as profit which is taxable to the owners. Note: this is an oversimplification as it's oftentimes the case that vehicles are partially used for business instead of all or nothing. In fact, large items such as vehicles are typically depreciated so the full purchase price could not be deducted in a single year. If many of the purchases are depreciated items instead of deductions, then this could explain why it appears that the business expenses are being taxed. It's not a tax on the expense, but on the income that hasn't been reduced by expenses, since only a portion of the big ticket item can be treated as an expense in a single year." }, { "docid": "231990", "title": "", "text": "\"If you are a telecommuter and in good terms with your employer, then all you need is contact your employer and explain your situation. Ask them for a short letter that indicates: \"\"1. they require you to work from a privately rented office (or from a home office for those who prefer working from home), 2. this is one of the terms of your employment, and, 3. they will not reimburse you for this expense.\"\" With this letter in your hand, you satisify both the \"\"convenience of employer\"\" test AND the deduction of the rent for your private office as a unreimbursed employee expense. The IRS cannot expect your employer to open an office branch in your city just for your sake, nor can they expect you to commute to your employer's city for work, which is an impossiblity considering the distance. Additionally, the IRS cannot \"\"force\"\" telecommuters to work from home. The key is to get a letter from your employer. You'd be surprised how easily they are willing to write such letter for you.\"" }, { "docid": "223697", "title": "", "text": "One thing that kept me from doing a budget for years is how complex some people make it. For example you list your gross pay, then deduct the taxes, 401K, FSA, etc... Why? Those are pretty consistent. For me, the way this is budgeted is I list my net pay, and go from there. If you were perfect in predicting your FSA, you would have no medical expenses on your budget! Simple, easy budget! Now this year, you will probably have to pay out of pocket for some expenses. Can you predict how much? Can your disposable income absorb the overages? If not you will need to start a sinking fund. That is put a sufficient amount of money into a savings account each month to cover the shortage. Keep in mind you can go over a bit on your FSA contributions. If you find yourself near the end of the plan year with extra money, you can also claim mileage reimbursement for your medical appointments. Since your FSA has a history of those, it is easy to calculate your mileage from your home to the DR's office and submit a claim." }, { "docid": "217748", "title": "", "text": "Edit: Let's forget about Wikipedia. From the horse's mouth: The cafeteria plan rules require that a health FSA provide uniform coverage throughout the coverage period (which is the period when the employee is covered by the plan). See Proposed Treasury Regulations Section 1.125-5(d). Under the uniform coverage rules, the maximum amount of reimbursement from a health FSA must be available at all times during the coverage period. This means that the employee’s entire health FSA election is available from the first day of the plan year to reimburse qualified medical expenses incurred during the coverage period. The cafeteria plan may not, therefore, base its reimbursements to an employee on what that employee may have contributed up to any particular date, such as the date the employee is laid-off or terminated. Thus, if an employee’s reimbursements from the health FSA exceed his contributions to the health FSA at the time of lay-off or termination, the employer cannot recoup the difference from the employee. (emphasis added) http://www.irs.gov/pub/irs-wd/1012060.pdf Uniform Coverage Rule The IRS has required that “health FSAS must qualify as accident or health plans. This means that, in general, while the health coverage under the FSA need not be provided through a commercial insurance contract, health FSAS must exhibit the risk-shifting and risk-distribution characteristics of insurance.” This concept has led to the “uniform coverage” rule. The uniform­coverage rule requires that the maximum amount of an employee’s projected elective contributions to a health FSA must be available from the first day of the plan year to reimburse the employee’s qualified medical expenses, regardless of the amount actually contributed to the plan at the time that reimbursement is sought. Citing proposed Treasury Regulations Section the IRS General Counsel has determined that: “Under the uniform coverage rules, the maximum amount of reimbursement from a health FSA must be available at all times during the coverage period. The cafeteria plan may not, therefore, base its reimbursements to an employee on what that employee may have contributed up to any particular date, such as the date the employee is laid-off or terminated. Thus, if an employee’s reimbursements from the health FSA exceed his contributions to the health FSA at the time of or termination, the employer cannot recoup the difference from the employee.” This rule is unfair and also constitutes a disincentive to establishing FSAS because of the exposure to out-of pocket expenditures arising from employees who leave the company. NSBA believes that the uniform coverage rule should also be revised if the or lose- it rule is changed. Revising the use-it or lose-it rule while leaving the uniform coverage rule unchanged will introduce an inappropriate asymmetry to FSAS. An employer should be allowed to deduct any negative amount arising from insuftîcient employee contributions from a terminating partieipant’s last paycheck. http://www.ecfc.org/files/legislative-news/NSBA_(David_Burton).pdf (emphasis added) Now, that's some fresh bitterness for you right there. (Dated August 17, 2012)" }, { "docid": "390435", "title": "", "text": "If you itemize your deductions then the interest that you pay on your primary residence is tax deductible. Also realestate tax is also deductible. Both go on Schedule A. The car payment is not tax deductible. You will want to be careful about claiming business deduction for home or car. The IRS has very strict rules and if you have any personal use you can disqualify the deduction. For the car you often need to use the mileage reimbursement rates. If you use the car exclusively for work, then a lease may make more sense as you can expense the lease payment whereas with the car you need to follow the depreciation schedule. If you are looking to claim business expense of car or home, it would be a very good idea to get professional tax advice to ensure that you do not run afoul of the IRS." }, { "docid": "59819", "title": "", "text": "The CPA's mention of $2,500 is probably referring to the recently increased de minimis safe harbor under the final tangible property regulations (used to be $500) without an applicable financial statement. The IRS will not challenge your choice of expense or capitalization on amounts on or below $2500 if you elect the de minimis safe harbor election on your return. However, you must follow whatever you're doing for your books. (So if you are capitalizing your laptops for book purposes, you would also need to capitalize for tax purposes). Section 179 allows you to expense property that you would have otherwise have had to capitalize and depreciate. Section 179 can be annoying, especially if your LLC is treated as a passthrough, because there are recapture provisions when you dispose of the asset too early. For the tax return preparer, it makes the return preparation much more simple if there are no fixed assets to account for in the first place, which is quite possible if you are expensive all items/invoices less than $2,500." }, { "docid": "484424", "title": "", "text": "Generally, the HSA is self-reported. The bank/financial provider will allow you to withdraw/spend whatever you want from your HSA. They report to the IRS the total that you withdrew for the year (your gross distributions) on a 1099-SA form. At tax time, you use a form 8889 to report this number of your gross distributions, and how much of it was used for medical expenses. Ideally, all of it was used for medical expenses. If it was not all for medical expenses, there will be extra taxes/penalties due. Different HSAs work differently, but for mine, which is held at a credit union, I can get money out several ways. I have an HSA checkbook and an HSA debit card that I can use anywhere. I can also transfer money out of my HSA into my regular checking account to reimburse myself for an expense, or even stop in at the teller window and take out cash. The credit union doesn't need to see any receipts for any of this. They don't care if I'm spending it at the doctor's office or the casino. It is up to me to make sure I'm spending the money in accordance to the law and that everything is reported correctly on my tax return. Nothing is verified unless you get audited. You definitely should keep documentation on the expenses, because if you are audited, you need to be prepared to account for every withdrawal. Make sure you are very familiar with the rules on eligible medical expenses, so you know what is allowed and what is not. IRS Publication 502 has all the details on what is allowed. As far as how it gets counted towards your deductible, you need to make sure that all of your medical bills get sent to your health insurance, even if you will eventually have to pay for it. For example, let's say you go to the doctor, and the bill is $150. Even if you know that the deductible is not met yet and you will be responsible for the entire $150, make sure the doctor's office submits the bill to your insurance. The insurance company will inform the doctor's office that you are responsible for all of it, but they will apply the amount towards your deductible." }, { "docid": "151311", "title": "", "text": "Part of 'consideration', I imagine, would be the obligation of either party to follow through on an agreement, not only fair market value. Look at the thought experiment from the opposite perspective. If you did not pay him $150 (maybe just $50 or even $0), would you be breaking a contractual obligation to him? If he left after 2 hours because he forgot about a family event and did not finish your move, would he be breaking a contractual obligation to you even if you gave him $150? It seems it can be considered a gift (Update: in all cases) There was no agreement of what either party viewed as full consideration in a mutual exchange. To put it another way: From your examples, there is no evidence that the performance of either party hinged on receiving mutual consideration from the other. More Updates from comments: Patterns Matter Similarly to how the IRS may determine W2 employee vs independent contractor, patterns do matter. If your friend has a pattern of helping people move in exchange for tens of thousands of dollars in gifts every year, the IRS would view that in a different light. A waitress/waiter has a pattern of accepting 'gifts' of tips in exchange for good service as a part of their established job duties. If you gifted your friend with $150/week when they watched your kids every Monday-Wednesday, that would be different. You are establishing a pattern, and I would suggest you may be establishing mutual consideration. In that case, consult a professional if you are worried. Amounts Matter This is why the gift tax exemption was created. The IRS does not care about the amounts in question here. It is too much of a burden to track and account for transactions that are this questionable and this small. You gift your friend with a $20k car? Now you need to pay attention. Consult your CPA. You gift your friend $1k for helping build your new deck? The IRS does not care. Intent Matters Even in the first case, it is not necessarily true that your friend considers $150 to be mutual consideration for his services. Would he open a business where he offers that rate to the general public? I doubt it. He intends to gift you services out of his own free will, not because there will be an equitable exchange of value. The intent of both parties is to give a gift. There is no evidence that would suggest otherwise to the IRS, it seems, even if they cared in the first place." }, { "docid": "483394", "title": "", "text": "What might make more sense is to 'capture' your losses. Sell out the funds you have, move into something else that is different enough that the IRS won't consider it a wash sale, and you can then use those losses to offset gains (you can even carry them forward) You would still be in the market, just having made a sort of 'sideways move'. A month or two later (once you are clear of wash sale rules) you could shift back to your original choices. (this answer presumes you are in the US, or somewhere that lets you use losses to offset gains)" }, { "docid": "197596", "title": "", "text": "As others have said, please talk to a professional adviser. From my quick research, domain names can only be amortized as 197 intangible if it's used for the taxpayer's business. For example, if Corp A pays $200,000 for corpa.com and uses that to point to their homepage, they can amortize it over 15 years as a 197 intangible. (Please refer to this IRS memo https://www.irs.gov/pub/irs-wd/201543014.pdf.) The above memo does not issue any guidance in your case, where domains are purchased for investment or resale. Regarding domain names, the U.S. Master Depreciation Guide (2016) by CCH says: Many domain names are purchased in a secondary market from third parties [...] who register names and resell them at a profit. These cost must be capitalized because the name will have a useful life of more than one year. The costs cannot be amortized because a domain name has no useful life. So your decision to capitalize is correct, but your amortization deductions may be challenged by the IRS. When you sell your domain, the gain will be determined by how you treat these assets. If you treat your domains as 197 intangibles, and thus had ordinary deductions through amortization, your gain will be ordinary. If you treated them as capital assets, your gain will be a capital gain. Very conceptually, and because the IRS has not issued specific guidelines, I think holding domain names for resale is similar to buying stock of a company. You can't amortize the investment, and when you sell, the gain or loss is a capital gain/loss." }, { "docid": "370542", "title": "", "text": "\"Be careful of the other answers here. Many are wrong or partially wrong. The question implies that you knew this, but for everyone else's benefit, you can keep you LLC organization and still elect to be treated as a S-Corp by the IRS just for tax purposes. You do this by filing Form 2553 with the IRS. (You can also, by the way, elect to be taxed as a \"\"regular\"\" C-Corp if you want, although that's probably not advantageous. See Form 8832.) The advantage of electing to be treated as an S-Corp is that income beyond what constitutes a \"\"reasonable salary\"\" are not subject to social security and medicare taxes as they would when paid was wages or counted as self-employment income on Schedule C. Depending on what you need to pay yourself to meet the \"\"reasonable salary\"\" test, your overall income, and other factors about your business, this could result in tax savings. Contrary to other answers here, making this election will not force you to create a board of directors. You are still an LLC for all purposes except taxes, so whatever requirements you had in organization and governance at the state level will not change. You will have to file a \"\"corporate\"\" tax return on Form 1120S (and likely some corresponding state tax form), so that is additional paperwork, but this \"\"corporate\"\" return does not mean the S-Corp pays taxes itself. With a couple of exceptions, the S-Corp pays no taxes directly (and therefore does not pay at the corporate tax rate). Instead the S-Corp apportions its income, expenses, and deductions to the owner(s) on Schedule K. The owners get their portion reported from the S-Corp on Schedule K1 and then include that on their personal Form 1040 to pay tax at their personal rate. In addition to filing Form 1120S, you will have to handle payroll taxes, which will create some additional administrative work and/or cost. Using a payroll service for this will likely be your best option and not terribly expensive. You've also got the issue of determining your reasonable salary within the rules, which is the subject of other questions on this site and other IRS guidance.\"" }, { "docid": "577475", "title": "", "text": "In short, I suggest you take a look at your W-4 form and adjust it properly. And yes you can claim your self as a dependent, unless someone else is claiming you. But here is a more detailed explanation of how it works. How Income Tax Works. While most people tend to only think about the tax system and the Internal Revenue Service (IRS) as the month of April approaches, it's actually a never-ending process. For our purposes, a good way to explain how the system works is to give an example of one American income earner, we will call him Joe. The tax process begins when Joe starts his new job. He and his employer agree on his compensation, which will be figured into his gross income at the end of the year. One of the first things he has to do when he's hired is fill out all of his tax forms, including a W-4 form. The W-4 form lists all of Joe's withholding allowance information, such as his number of dependents and child care expenses. The information on this form tells your employer just how much money it needs to withhold from your paycheck for federal income tax. The IRS says that you should check this form each year, as your tax situation may change from year to year. Once Joe is hired and given a salary, he can estimate how much he will pay in taxes for the year. Here's the formula: At the end of each pay period, Joe's company takes the withheld money, along with all of withheld tax money from all of its employees, and deposits the money in a Federal Reserve Bank. This is how the government maintains a steady stream of income while also drawing interest on your tax dollars. Toward the end of the tax year, Joe's company has to send him a W-2 form in the mail. This happens by January 31. This form details how much money Joe made during the last year and how much federal tax was withheld from his income. This information can also be found on Joe's last paycheck of the year, but he'll need to send the W-2 to the IRS for processing purposes. At some point between the time Joe receives his W-2 and April 15, Joe will have to fill out and return his taxes to one of the IRS service and processing centers. Once the IRS receives Joe's tax returns, an IRS employee keys in every piece of information on Joe's tax forms. This information is then stored in large magnetic tape machines. If Joe is due a tax refund, he is sent a check in the mail in the next few weeks. If Joe uses e-File or TeleFile, his refund can be direct-deposited into his bank account." } ]

[ { "docid": "218858", "title": "", "text": "I believe moving reimbursement has to be counted as income no matter when you get it. I'd just put it under miscellaneous income with an explanation." } ]

[ { "docid": "47527", "title": "", "text": "Not just lack of vision. Blockbuster was a large, comfortable, slow moving behemoth of a company, they wouldn't have risked cannibalising their current business model in order to create a new business model that might have become profitable a decade later. Not one chance in hell. If Blockbuster had bought Netflix, they would have killed it. No doubt at all about that. But the market disruption was inevitable. Some other actor would have seized the opportunity instead, just a year or three later. When a market is ready for disruption, killing the disruptor doesn't change anything, it just delays the inevitable by a short time. That's what happened with reddit. Kevin Rose invented reddit, he called his original version Digg. Digg is the original that reddit was a carbon copy of, but then Rose came down with a serious case of delusion of grandeur, started treating his users like utter shit, so they all left for the carbon copy that was reddit. Today, barley anyone remembers Digg." }, { "docid": "381151", "title": "", "text": "Chris, since you own your own company, nobody can stop you from charging your personal expenses to your business account. IRS is not a huge fan of mixing business and personal expenses and this practice might indicate to them that you are not treating your business seriously, and it should classify your business as a hobby. IRS defines deductible business expense as being both: ordinary AND necessary. Meditation is not an ordinary expense (other S-corps do not incur such expense.) It is not a necessary expense either. Therefore, you cannot deduct this expense. http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Deducting-Business-Expenses" }, { "docid": "391619", "title": "", "text": "It would be unusual but it is possible that the expenses could be very high compared to your income. The IRS in pub 529 explains the deduction. You can deduct only unreimbursed employee expenses that are: Paid or incurred during your tax year, For carrying on your trade or business of being an employee, and Ordinary and necessary. An expense is ordinary if it is common and accepted in your trade, business, or profession. An expense is necessary if it is appropriate and helpful to your business. An expense doesn't have to be required to be considered necessary. The next part lists examples. I have cut the list down to highlight ones that could be large. You may be able to deduct the following items as unreimbursed employee expenses. Damages paid to a former employer for breach of an employment contract. Job search expenses in your present occupation. Legal fees related to your job. Licenses and regulatory fees. Malpractice insurance premiums. Research expenses of a college professor. Rural mail carriers' vehicle expenses. Tools and supplies used in your work. Work clothes and uniforms if required and not suitable for everyday use. Work-related education. If the term of employment was only part of the year, one or more of the these could dwarf your income for the year. Before deducting something that large be sure you can document it. I believe the IRS computers would flag the return and I wouldn't be surprised if they ask for additional proof." }, { "docid": "140349", "title": "", "text": "Are you obligated to do what they ask? Probably not, with one big caveat discussed below. Your employer sent your money and their money after every paycheck to the 401K management company. Then after a while the 401K management company followed your instructions to roll it over into an IRA. Now the IRA management company has it. Pulling it out of the IRA would be very hard, and the IRA company would be required to report it to the IRS as a withdraw. Here is the caveat. If the extra funds you put in allowed you to exceed the annual contribution amount set by the law, or if it allowed you to put more than 100% of your income into the fund, then this would be an excess contribution, and you and your employer would have to resolve or face the excess contribution penalties. Though if the 401K company and HR allowed you to exceed the annual limit they have a much more complex problem with their payroll system. The bigger concern is why they want you to pull out your $27.50 and their $27.50. Unless you were hitting the maximum limit, your $27.50 could have been invested by adjusting the percentage taken out of each check. You could have picked a percentage to reach a goal. That money is yours because you contributed it and unless you exceed the IRS set limits it is still pre-tax retirement money. The return of matching funds may be harder to calculate. The returns for 2013 were very good. Each $1.06 of matching funds each paycheck purchased a fraction of some investment. That investment went up and down, ok mostly up, if it was invested in the broad market. I guess you should be glad they aren't asking for more due to the increase in value. It would be very hard to calculate what happened if you have moved it around since then. Which of course you did when you moved it into an IRA. If the average employee was also given a $55 gift last year, then the suggestion to the employer is that the tax complexity you and your fellow employees face would exceed the cost of the extra funds. They should chalk it up to an expensive lesson and move on." }, { "docid": "202224", "title": "", "text": "\"Your debits and credits are perfect. Now, it comes down to a choice of how you want your accounts organized, financially speaking. In terms of taxes, it's recommended you keep a separate set of books just like a corporation and account for them strictly according to law. It's best not to credit phone expenses since it will no longer show on your net reports. A better alternative would be \"\"Phone reimbursement\"\". With that, you can not only see if you've been compensated but also how much you're personally managing these expenses by checking the annual \"\"Phone expense\"\" account. This is all up to personal preference, but so long as you're properly balancing your accounts, you can introduce any level of resolution you wish. I prefer total resolution when it comes to financial accounting. Also, it is not good practice to debit away \"\"Salary\"\". The net of this account will be lower and distorted. An expense reimbursement is not salary anyways, so the proper bookings will follow below. Finally, if GnuCash is calling \"\"Salary\"\" an income account, this is unfortunate. The proper label would be \"\"revenue\"\" since \"\"income\"\" is a net account of expenses from revenue in the income identity. Entries With this, your books will become clearer: your cash assets will remain as clear as you had organized them, but now your income statement will provide higher resolution.\"" }, { "docid": "59819", "title": "", "text": "The CPA's mention of $2,500 is probably referring to the recently increased de minimis safe harbor under the final tangible property regulations (used to be $500) without an applicable financial statement. The IRS will not challenge your choice of expense or capitalization on amounts on or below $2500 if you elect the de minimis safe harbor election on your return. However, you must follow whatever you're doing for your books. (So if you are capitalizing your laptops for book purposes, you would also need to capitalize for tax purposes). Section 179 allows you to expense property that you would have otherwise have had to capitalize and depreciate. Section 179 can be annoying, especially if your LLC is treated as a passthrough, because there are recapture provisions when you dispose of the asset too early. For the tax return preparer, it makes the return preparation much more simple if there are no fixed assets to account for in the first place, which is quite possible if you are expensive all items/invoices less than $2,500." }, { "docid": "576985", "title": "", "text": "How long you need to keep tax records will depend on jurisdiction. In general, if you discard records in a period of time less than your tax authority recommends, it may create audit problems down the road. ie: if you make a deduction supported by business expense receipts, and you discard those receipts next year, then you won't be able to defend the deduction if your tax authority audits you in 3 years. Generally, how long you keep records would depend on: (a) how much time your tax authority has to audit you; and (b) how long after you file your return you are allowed to make your own amendments. In your case (US-based), the IRS has straight-forward documentation about how long it expects you to keep records: https://www.irs.gov/businesses/small-businesses-self-employed/how-long-should-i-keep-records Period of Limitations that apply to income tax returns Keep records for 3 years if situations (4), (5), and (6) below do not apply to you. Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return. Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction. Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return. Keep records indefinitely if you do not file a return. Keep records indefinitely if you file a fraudulent return. Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later. Note that the above are the minimum periods to keep records; for your own purposes you may want to keep them for longer periods than that. For example, you may be in a position to discover that you would like to refile a prior tax return, because you forgot to claim a tax credit that was available to you. If you would have been eligible to refile in that period but no longer have documentation, you are out of luck." }, { "docid": "284920", "title": "", "text": "\"According to the instructions for IRS Form 8889, Expenses incurred before you establish your HSA are not qualified medical expenses. If, under the last-month rule, you are considered to be an eligible individual for the entire year for determining the contribution amount, only those expenses incurred after you actually establish your HSA are qualified medical expenses. Accordingly, your medical expenses from year A are not considered \"\"qualified medical expenses\"\" and you should not use funds in your HSA to pay them unless you would like to pay taxes on the distributed funds and a 20% penalty. Publication 969 states very clearly on page 9: How you report your distributions depends on whether or not you use the distribution for qualified medical expenses (defined earlier). If you use a distribution from your HSA for qualified medical expenses, you do not pay tax on the distribution but you have to report the distribution on Form 8889. There is nothing about the timing of contributions versus distributions. As long as the distribution is for a qualified medical expense, the distribution will not be included in gross income and not subject to penalty regardless of how much money you had in your HSA when you incurred the medical expense.\"" }, { "docid": "119416", "title": "", "text": "\"I think you misunderstand the purpose of the liability account. I would suggest you review the standard accounting model, but to give you a brief overview: Income and expenses are money coming into and out of your possession. They are the pipes flowing into and out of your \"\"box\"\". Inside your box, you have assets (bank, savings, cash, etc) and liabilities (credit cards, unpaid debts, etc). Money can flow into and out of either asset or liability accounts, for example: deposit a payment (income to asset), buy office supplies with cash (asset to expense), pay a bill with credit card (liability to expense), customer pays one of your debts directly (income to liability). Paying off a debt with an asset does not affect your overall net worth, so paying a check to your credit card bill (asset to liability) doesn't decrease your total balance, it merely moves the value from one bucket to another. Now to your question: Mandatory payments, such as taxes or insurance (or for that matter, utilities, rent, food- all things that \"\"must\"\" be bought occasionally) are not liabilities, instead they are all expenses. They might be paid FROM a liability account, if they are paid on credit for example, but the money still flows from liability to expense. In my own records I have Expense:Taxes and Expense:Insurance, with sub-accounts in each. Where the money comes from depends entirely on how I pay my bills, whether from cash or banks (asset) or whether it's a charge (liability). Sometimes you receive payments back from an insurance company. I find that rather than treating insurance premiums as a positive balance in a liability (with eventual payments as debits to the liability account), it is better to treat any payment from the insurance as income. Hope that helps!\"" }, { "docid": "217748", "title": "", "text": "Edit: Let's forget about Wikipedia. From the horse's mouth: The cafeteria plan rules require that a health FSA provide uniform coverage throughout the coverage period (which is the period when the employee is covered by the plan). See Proposed Treasury Regulations Section 1.125-5(d). Under the uniform coverage rules, the maximum amount of reimbursement from a health FSA must be available at all times during the coverage period. This means that the employee’s entire health FSA election is available from the first day of the plan year to reimburse qualified medical expenses incurred during the coverage period. The cafeteria plan may not, therefore, base its reimbursements to an employee on what that employee may have contributed up to any particular date, such as the date the employee is laid-off or terminated. Thus, if an employee’s reimbursements from the health FSA exceed his contributions to the health FSA at the time of lay-off or termination, the employer cannot recoup the difference from the employee. (emphasis added) http://www.irs.gov/pub/irs-wd/1012060.pdf Uniform Coverage Rule The IRS has required that “health FSAS must qualify as accident or health plans. This means that, in general, while the health coverage under the FSA need not be provided through a commercial insurance contract, health FSAS must exhibit the risk-shifting and risk-distribution characteristics of insurance.” This concept has led to the “uniform coverage” rule. The uniform­coverage rule requires that the maximum amount of an employee’s projected elective contributions to a health FSA must be available from the first day of the plan year to reimburse the employee’s qualified medical expenses, regardless of the amount actually contributed to the plan at the time that reimbursement is sought. Citing proposed Treasury Regulations Section the IRS General Counsel has determined that: “Under the uniform coverage rules, the maximum amount of reimbursement from a health FSA must be available at all times during the coverage period. The cafeteria plan may not, therefore, base its reimbursements to an employee on what that employee may have contributed up to any particular date, such as the date the employee is laid-off or terminated. Thus, if an employee’s reimbursements from the health FSA exceed his contributions to the health FSA at the time of or termination, the employer cannot recoup the difference from the employee.” This rule is unfair and also constitutes a disincentive to establishing FSAS because of the exposure to out-of pocket expenditures arising from employees who leave the company. NSBA believes that the uniform coverage rule should also be revised if the or lose- it rule is changed. Revising the use-it or lose-it rule while leaving the uniform coverage rule unchanged will introduce an inappropriate asymmetry to FSAS. An employer should be allowed to deduct any negative amount arising from insuftîcient employee contributions from a terminating partieipant’s last paycheck. http://www.ecfc.org/files/legislative-news/NSBA_(David_Burton).pdf (emphasis added) Now, that's some fresh bitterness for you right there. (Dated August 17, 2012)" }, { "docid": "37306", "title": "", "text": "\"I used Quicken, so this may or may not be helpful. I have a Cash account that I call \"\"Temporary Assets and Liabilities\"\" where I track money that I am owed (or that I owe in some cases). So if I pay for something that is really not my expense, it is transferred to this account (\"\"transferred\"\" in Quicken terms). The payment is then not treated as an expense and the reimbursement is not treated as income--the two transactions just balance out.\"" }, { "docid": "160340", "title": "", "text": "\"If all of the relocation expenses are paid by your employer to the moving companies, then you should not have any tax liability for those payments. Relocation expenses should be treated as normal business expenses by your employer. Note I emphasize \"\"should\"\" because it's possible that your employer \"\"could\"\" consider it income to you, but companies generally do not go out of their way to classify normal business expenses as income since it costs both them and you more money in taxes. As a side note, the reason your company is paying these expenses directly is probably to lessen the likelihood of these expenses being questioned in an audit (in comparison to if they cut you a reimbursement check which could get more scrutiny).\"" }, { "docid": "206597", "title": "", "text": "The rebate amount is a non-qualified distribution: IRS Pub 969 describes how the HSA works: Reporting Distributions on Your Return How you report your distributions depends on whether or not you use the distribution for qualified medical expenses (defined earlier). If you use a distribution from your HSA for qualified medical expenses, you do not pay tax on the distribution but you have to report the distribution on Form 8889. However, the distribution of an excess contribution taken out after the due date, including extensions, of your return is subject to tax even if used for qualified medical expenses. Follow the instructions for the form and file it with your Form 1040 or Form 1040NR. If you do not use a distribution from your HSA for qualified medical expenses, you must pay tax on the distribution. Report the amount on Form 8889 and file it with your Form 1040 or Form 1040NR. If you have a taxable HSA distribution, include it in the total on Form 1040 or Form 1040NR, line 21, and enter “HSA” and the amount on the dotted line next to line 21. You may have to pay an additional 20% tax on your taxable distribution. I looked at several plans regarding how to handle mistaken distributions: example A What if I accidentally use my HSA Visa debit card for a non-qualified expense? To fix this problem, just bring that same amount into any local branch and tell us it was a Mistaken Distribution. We can then put the funds back into your HSA and correct the problem. example B You’re allowed to correct mistaken HSA withdrawals when there is clear and convincing evidence that amounts were distributed from an HSA because of a mistake of fact due to reasonable cause. You can correct the mistake by repaying the withdrawal no later than April 15 following the first year that you knew or should have known that the withdrawal was a mistake. When a correction is made, the mistaken withdrawal does not have to be included in gross income or be subject to the 6 percent additional tax, and the repayment does not count as an excess contribution. If an error is made by SelectAccount in its role as the administrator, SelectAccount will be responsible for taking appropriate corrective action. Check with your plan trustee on their procedure to fix the mistaken withdrawal." }, { "docid": "97719", "title": "", "text": "\"Disclaimer: This should go without saying, but this answer is definitely an opinion. (I'm pretty sure my current accountant would agree with this answer, and I'm also pretty sure that one of my past accountants would disagree.) When I started my own small business over 10 years ago I asked this very same question for pretty much every purchase I made that would be used by both the business and me personally. I was young(er) and naive then and I just assumed everything was deductible until my accountant could prove otherwise. At some point you need to come up with some rules of thumb to help make sense of it, or else you'll drive yourself and your accountant bonkers. Here is one of the rules I like to use in this scenario: If you never would have made the purchase for personal use, and if you must purchase it for business use, and if using it for personal use does not increase the expense to the business, it can be fully deducted by the business even if you sometimes use it personally too. Here are some example implementations of this rule: Note about partial expenses: I didn't mention partial deductions above because I don't feel it applies when the criteria of my \"\"rule of thumb\"\" is met. Note that the IRS states: Personal versus Business Expenses Generally, you cannot deduct personal, living, or family expenses. However, if you have an expense for something that is used partly for business and partly for personal purposes, divide the total cost between the business and personal parts. You can deduct the business part. At first read that makes it sound like some of my examples above would need to be split into partial calulations, however, I think the key distinction is that you would never have made the purchase for personal use, and that the cost to the business does not increase because of allowing personal use. Partial deductions come into play when you have a shared car, or office, or something where the business cost is increased due to shared use. In general, I try to avoid anything that would be a partial expense, though I do allow my business to reimburse me for mileage when I lend it my personal car for business use.\"" }, { "docid": "51491", "title": "", "text": "You cannot deduct expenses directly. However, your employer may participate in programs to allow you to make a pretax deduction capped at $255 per month to pay for certain commuting expenses. For personal car commuters the main category is to pay for parking. IRS guidelines Qualified Transportation Benefits This exclusion applies to the following benefits. A ride in a commuter highway vehicle between the employee's home and work place. A transit pass. Qualified parking. Qualified bicycle commuting reimbursement. You may provide an employee with any one or more of the first three benefits at the same time. However, the exclusion for qualified bicycle commuting reimbursement isn't available in any month the employee receives any of the other qualified transportation benefits." }, { "docid": "551864", "title": "", "text": "\"In general, you are allowed to deduct up to $50/month per student (see page 4), but only if you aren't reimbursed. In your case, since you are receiving a stipend, the full $2000 will be treated as taxable income. But the question of \"\"is it worth it\"\" really depends on how much you will actually spend (and also what you'll get from the experience). Suppose you actually spend $1000/month to host them, and if your combined tax rate is 35%, you'll pay $700 in additional taxes each month, but you'll still profit $300 each month. If your primary motivation for hosting students is to make a profit, you could consider creating a business out of it. If you do that you will be able to deduct all of your legitimate business expenses which, in the above example, would be $1000/month. Keeping with that example, you would now pay taxes on $1000 instead of $2000, which would be $350, meaning your profit would now be $650/month. (Increasing your profit by $350/month.) You will only need to keep spending records if you plan to go the business route. My advice: assume you won't be going the business route, and then figure out what your break even point is based on your tax rate (Fed+state+FICA). The formula is: Max you can spend per month without losing money = 2000 - (2000 * T) e.g. if T = 35%, the break even point is $1300. Side note: My family hosted 5 students in 5 years and it was always a fantastic experience. But it is also a very big commitment. Teenagers eat a lot, and they drive cars, and go on dates, and play sports, and need help with their homework (especially English papers), and they don't seem to like bed times or curfews. IMHO it's totally worth it, even without the stipend...\"" }, { "docid": "584322", "title": "", "text": "Utilities and cost of living vary from city to city but maybe not that much. For basic planning purposes you can probably figure to spend as much as you are now, maybe a little more. And adjust as needed when you get there. (And adjust if, for example, you're moving from a very low cost of living area or to a very high cost of living area.) The cost of housing varies quite a bit from city to city, but you can do this research using Zillow, Craigslist, other places. Now, on to moving itself. The cost of moving can vary hugely depending on how much stuff you have and how much work you want to do. On the cheap end, you can rent a U-Haul or one of those portable boxes that they plant outside your old house and move for you. You'll do all the packing/loading/unloading/unpacking yourself but it saves quite a bit of money. My family and I moved from Seattle to California last year using one of those portable box places and it ended up costing us ~$1400 including 30 days of storage at the destination while we looked for a place. We have a <1000 sq foot place with some furniture but not a huge amount and did all the packing/loading ourselves. If we had wanted full service where people come pack, load, unpack, etc, it could have been 2-3x that amount. (And if we had more stuff, it could have been a lot more expensive too. Try not to acquire too much stuff as you just end up having to move it around and take care of it all!) Your employer may cover moving expenses, ask about this when talking about job offers. Un-reimbursed moving expenses are tax-deductible in the US (even if you don't itemize). Since you're just starting out, your best bet is to overestimate how much you think things will cost, then adjust as you arrive and settle in for a few months. Try to save as much as you can, but remember to have fun too. Hope this helps!" }, { "docid": "478987", "title": "", "text": "From a federal tax point of view, withdrawals from 529 plans are treated as taxable unless they are used on qualified expenses: The part of a distribution representing the amount paid or contributed to a QTP does not have to be included in income. This is a return of the investment in the plan. The designated beneficiary generally does not have to include in income any earnings distributed from a QTP if the total distribution is less than or equal to adjusted qualified education expenses (defined under Figuring the Taxable Portion of a Distribution , later). [...] To determine if total distributions for the year are more or less than the amount of qualified education expenses, you must compare the total of all QTP distributions for the tax year to the adjusted qualified education expenses. You'll have to include them in your income and pay normal income tax on them, and also in most cases pay an extra 10% penalty: Generally, if you receive a taxable distribution, you also must pay a 10% additional tax on the amount included in income. You'd have to check on the situation from a state perspective but I'd imagine it's quite similar. The basic point is that non-qualified distributions are treated as earnings." }, { "docid": "292222", "title": "", "text": "Or we could allow market forces to work: My suggestion woudl be to outlaw price descrimination (charging different people different rates), force providers to disclose prices publicly, and discourage patients from paying everything through a middle man type insureer and purchase more services upfront. We coudl then institute a national catastrophic insurance to trigger in life/death situations and we could then reimburse lower income people later with a government program; *but the amount of reimbursement needs to be hidden from the service provider,* because if they know how much the patient gets reimbursed, they will just charge more." } ]

[ { "docid": "591357", "title": "", "text": "The LLC is paying you. It would only be fraudulent if you were trying to move the money out of the LLC to avoid a liability. I'm pretty sure the transaction will be taxable income for you personally. Consider consulting with a CPA to ensure that you're doing the proper record keeping and to get advice on the best way to minimize tax burden while achieving your goals." } ]

[ { "docid": "69938", "title": "", "text": "If your credit is good, you should immediately attempt to refinance your high rate credit cards by transferring the balance to credit cards with lower interest rates.You might want to check at your local credit union, credit unions can offer great rates. Use the $4000 to pay off whatever is left on the high rate cards. If your credit is bad, I suggest you call your credit card company and try to negotiate with them. If they consider you a risk they might settle your account for fraction of what you own if you can send payment immediately. Don't tell them you have money, just tell them your are trying to get your finances under control and see what they can offer you. This will damage your credit score but will get you out of depth much sooner and save you money in the long term. Also keep in mind that if they do settle, they'll close your account. That way, you leverage the $4000 and use it as a tool to get concessions from the bank." }, { "docid": "307404", "title": "", "text": "I am a non-resident alien transferring a limited amount ( in dollars post tax) to India every couple of months. Assuming you are transferring this into an NRE account in India or atleast NRO account in India. As a NRI, by regulations one should not hold normal Savings account. This has to be converted into NRO. I put that money as a fixed deposit in a bank (which gives 6-7 percent annual return) Assuming you have FCNR deposits. Also assuming that you are declaring the taxes in your US Tax returns and paying tax accordingly. There is no tax in India on FCNR. If this was in ordinary FD or in NRO account, you are declaring and paying taxes in India as well as in US. What is the max limit on transferring money back from India to USA? If you have transferred this into NRE account, there is no limit. Other account there is a limit. Read more at Liberalized Remittance Scheme and here. What are the legitimate ways to transfer the money? From India point of view, this has to be Bank to Bank transfers. You can't carry cash [Indian Rupees] outside of India beyond Rs 25000 [or 15000?]. You can't hold excess of USD 250 without valid purpose. Western Union is not authorized to transfer funds out of India. Will there be any tax levied? No assuming you are already paying taxes on the Interest in US and depending on the type of account in India." }, { "docid": "579473", "title": "", "text": "A technique that is working pretty well for me: Hide the money from myself: I have two bank accounts at different banks. Let's call them A and B. I asked my employer to send my salary into account A. Furthermore I have configured an automatic transfer of money from account A to account B on the first of each month. I only use account B for all my expenses (rent, credit card, food, etc) and I check its statement quite often. Since the monthly transfer is only 80% of my salary I save money each month in account A. I don't have a credit card attached to the savings account and I almost never look at its statement. Since that money is out of sight, I do not think much about it and I do not think that I could spend it. I know it is a cheap trick, but it works pretty well for me." }, { "docid": "106981", "title": "", "text": "Banks that use this amazing ClearXChange service: BOA, Capitol One, Chase, 1st Bank, Frost, US Bank and Wells Fargo I have Wells Fargo. There is a tab for SurePay. I had an option to register my phone number and/or email for this service. I wasn't automatically setup." }, { "docid": "88867", "title": "", "text": "My wife and I do this. We have one account for income and one for expenditures (and around 7 others for dedicated savings.) Doing this we are forcing ourselves to keep track of all expenditures as we have to manually transfer funds from one to the other, we try to do this periodically (every Wednesday) and then keep the expenditures within what is actually on the account. It is a really good way to keep track of everything. Bear in mind that our bank provides a fast handy smartphone app where we both can check our account as well as transfer funds in less than 10 seconds. (Fingerprint authentication, instant funds transfer as well as zero fees for transfers.) Right now we have a credit card each attached to the expenditures account, but earlier we only had a debit card each and no credit cards. Meaning that when the weekly funds ran out we where simply not able to pay. We did this to mimic living only on cash and when the cash runs out you simply have to stop buying stuff. And at the same time we could accrue quite a bit of savings. I would definitely recommend this if you have problems with over expenditures." }, { "docid": "578357", "title": "", "text": "\"Note that many credit unions participate in a \"\"branch exchange\"\" program, which lets you access you CU's accounts and services thru the offices of the others. My CU is two states away, but there has been only one case where I felt a need to drive back there. Find out if your has joined this network, and encourage them to do so if they haven't yet. It makes credit unions fully competitive with interstate banks. The shared-branch CU locations may not be maximally convenient, but more keep joining, and the most common transactions can be done by mail or ATM anyway. The biggest advantages of a local CU or bank are that they know the local rules for mortgages, and they may have safe deposit boxes for rent. That, and having a place to unload the pocket change that piles up, are why I've got an account with a small local bank a few blocks from my house as well. Though I keep thinking about joining my alma mater's credit union, and will if the ever get on the shared-branch system.\"" }, { "docid": "309279", "title": "", "text": "From my experience using PayPal for selling products on eBay (and for the last two, experiences of a friend)... Can paypal get money from my Bank Account without my authorization. This is assuming they have transferred the funds to me. They can't pull money from your bank account without your authorization. They will, however, take the money from your PayPal account if it's still there, or leave you with a negative balance if you've already withdrawn. They will do this as soon as there is a claim against you and will only release the funds if the investigation ends in your favor. Any money received would first be used to satisfy the negative balance. What actions can paypal takes against me if charge back amount is very high and I don't agree / pay them. They will send it to a collections agency. Is there any case it is going to effect my bank account, i.e. is there any chance paypal can block my bank account in India. They will block you from using PayPal. If you try to sign up again with a different bank account or credit card and they recognize you as the account holder, they will block that account as well." }, { "docid": "264932", "title": "", "text": "\"I linked my bank account (by making a transfer from bank account to Paypal) without linking a card. This should not give Paypal any rights to do anything with my bank account - transfer that I made to link it was exactly the same as any other outgoing transfer from my bank account. On attempting to pay more that resides in my Paypal balance I get To pay for this purchase right now, link a debit or credit card to your PayPal account. message. Paypal is not mentioning it but one may also transfer money to Paypal account form bank to solve this problem. Note, that one may give allow Paypal to access bank account - maybe linking a card will allow this? Paypal encourages linking card but without any description of consequences so I never checked this. It is also possible that Paypal gained access to your bank balance in other way - for example in Poland it just asked for logins and passwords to bank accounts (yes, using \"\"Add money instantly using Trustly\"\" in Poland really requires sharing full login credentials to bank account - what among other things breaks typical bank contract) source for \"\"Paypal attempts phishing\"\": https://niebezpiecznik.pl/post/uwaga-uzytkownicy-paypala-nie-korzystajcie-z-najnowszej-funkcji-tego-serwisu/\"" }, { "docid": "509073", "title": "", "text": "\"Yup. It's totally legit and it is not a money market account. Though interest rates are so low across the board, this is about as high as savings accounts get and so it is called a \"\"high-yield savings account\"\". A number of banks offer these. There are different offerings nation-wide versus local/state. I would use this compare tool at DepositAccounts.com to find them and the blog is very good with updates and trends. Here are some well advertised accounts: If you don't already have a rewards checking account, get one of those first. DepositAccounts.com will direct you to these as well. A reasonable interest rate on rewards checking is 2.5% and up. So much better. The only catches are reasonable - online statements, direct deposit or autopay, and use your debit card 10 or 12 times a month for any transaction amount (groceries, coffee, gas - easy). The other major thing I would consider when opening any account is where you live and the current accounts you have. If you have an AMEX card already, just use their savings account. That way you have unified accounts, faster transfers, your personal information isn't spread thinly around all different banks, you have more leverage with the company as a \"\"long-standing customer\"\", etc. As far as using a bank in the state where you live, it simplifies taxes. Two more things: I would always choose a credit union over a bank (and many have excellent rewards checking accounts). If you use Mint, Yodlee, or other financial software, make sure the potential new bank integrates with that service.\"" }, { "docid": "478807", "title": "", "text": "\"What you are describing sounds a lot like the way we handle our household budget. This is possible, but quite difficult to do with an Excel spreadsheet. It is much easier to do with dedicated budgeting software designed for this purpose. When choosing personal budgeting software, I've found that the available packages fall in two broad categories: Some packages take what I would call a proactive approach: You enter in your bank account balances, and assign your money into spending categories. When you deposit your paycheck, you do the same thing: you add this money to your spending categories. Then when you spend money, you assign it to a spending category, and the software keeps track of your category balances. At any time, you can see both your bank balances and your spending category balances. If you need to spend money in a category that doesn't have any more money, you'll need to move money from a different category into that one. This approach is sometimes called the envelope system, because it resembles a digital version of putting your cash into different envelopes with different purposes. A few examples of software in this category are You Need a Budget (YNAB), Mvelopes, and EveryDollar. Other packages take more of a reactive approach: You don't bother assigning a job to the money already in your bank account. Instead, you just enter your monthly income and put together a spending plan. As you spend money, you assign the transactions to a spending category, and at the end of the month, you can see what you actually spent vs. what your plan was, and try to adjust your next budget accordingly. Software that takes this approach includes Quicken and Mint.com. I use and recommend the proactive approach, and it sounds from your question like this is the approach that you are looking for. I've used several different budgeting software packages, and my personal recommendation is for YNAB, the software that we currently use. I don't want this post to sound too much like a commercial, but I believe it will do everything you are looking for. One of the great things about the proactive approach, in my opinion, is how credit card accounts are handled. Since your spending category balances only include real money actually sitting in an account (not projected income for the month), when you spend money out of a category with your credit card, the software deducts the money from the spending category immediately, as it is already spent. The credit card balance goes negative. When the credit card bill comes and you pay it, this is handled in the software as an account transfer from your checking account to your credit card account. The money in the checking account is already set aside for the purpose of paying your credit card bill. Dedicated budgeting software generally has a reconcile feature that makes verifying your bank statements very easy. You just enter the date of your bank statement and the balance, and then the software shows you a list of the transactions that fall in those dates. You can check each one against the transactions on the statement, editing the ones that aren't right and adding any that are missing from the software. After everything checks out, the software marks the transactions as verified, so you can easily see what has cleared and what hasn't. Let me give you an example to clarify, in response to your comment. This example is specific to YNAB, but other software using the same approach would work in a similar way. Let's say that you have a checking account and a credit card account. Your checking account, named CHECKING, has $2,000 in it currently. Your credit card currently has nothing charged on it, because you've just paid your bill and haven't used it yet this billing period. YNAB reports the balance of your credit card account (we'll call this account CREDITCARD), as $0. Every dollar in CHECKING is assigned to a category. For example, you've got $200 in \"\"groceries\"\", $100 in \"\"fast food\"\", $300 in \"\"rent\"\", $50 in \"\"phone\"\", $500 in \"\"emergency fund\"\", etc. If you add up the balance of all of your categories, you'll get $2,000. Let's say that you've written a check to the grocery store for $100. When you enter this in YNAB, you tell it the name of the store, the account that you paid with (CHECKING), and the category that the expense belongs to (groceries). The \"\"groceries\"\" category balance will go down from $200 to $100, and the CHECKING account balance will go down from $2,000 to $1,900. Now, let's say that you've spent $10 on fast food with your credit card. When you enter this in YNAB, you tell it the name of the restaurant, the account that you paid with (CREDITCARD), and the category that the expense belongs to (fast food). YNAB will lower the \"\"fast food\"\" category balance from $100 to $90, and your CREDITCARD account balance will go from $0 to $-10. At this point, if you add up all the category balances, you'll get $1,890. And if you add up your account balances, you'll also get $1,890, because CHECKING has $1,900 and CREDITCARD has $-10. If you get your checking account bank statement at this time, the account balance of $1,900 should match the statement and you'll see the payment to the grocery store, assuming the check has cleared. And if the credit card bill comes now, you'll see the fast food purchase and the balance of $-10. When you write a check to pay this credit card bill, you enter this in YNAB as an account transfer of $10 from CHECKING to CREDITCARD. This transfer does not affect any of your category balances; they remain the same. But now your CHECKING account balance is down to $1,890, and CREDITCARD is back to $0. This works just as well whether you have one checking account and one credit card, or 2 checking accounts, 2 savings accounts, and 3 credit cards. When you want to spend some money, you look at your category balance. If there is money in there, then the money is available to spend somewhere in one of your accounts. Then you pick an account you want to pay with, and, looking at the account balance, if there isn't enough money in that account to pay it, you just need to move some money from another account into that one, or pick a different account. When you pay for an expense with a credit card, the money gets deducted from the category balances immediately, and is no longer available to spend on something else.\"" }, { "docid": "278339", "title": "", "text": "\"The answer is that it depends on your bank and your creditor (whomever you are paying). Most banks offer \"\"overdraft protection\"\". For a fee, they will process the payment as if you had the money, and your account will become \"\"overdrawn\"\". The next deposit you put in will be applied to the overdraft and once the account is \"\"zeroed\"\" funds will begin to become available. The fees charged, and whether a particular charge will go through, depend on the bank; a few banks will process a payment without a fee if it only happens occasionally, some will hit you with a charge per debit in excess of the amount, while others will charge you per day on which debit transactions were made while your account was overdrawn, and still others will tack on a charge for leaving your account overdrawn for an extended period. In almost all cases, the for-profit institutions (banks) will charge more than non-profit institutions (credit unions). Watch out for banks that offer \"\"automatic overdraft transfer\"\"; they'll automatically transfer from another account (including, eek, a credit card) to cover a debit to an account with insufficient funds. Sounds great, but the fee they charge is often close to the overdraft fee, while without overdraft protection, if the payment were simply denied at point-of-sale, most banks have smartphone apps that allow for instantaneous transfer of funds, for free. I've never heard of a \"\"partial payment\"\"; you either have sufficient funds to cover the debit or you don't. If you don't, and you don't have overdraft protection, the bank will simply decline to pay. The result of that situation depends on the exact circumstances; if a utility check bounces, they may try to run it again the next day, or they may immediately cut your utilities and come after you for the balance. At point-of-sale, they simply won't give you the merchandise. Some places are really rabid about pursuing \"\"hot check writers\"\"; if the check doesn't clear you have to pay in cash, on the spot, or they call the police. As far as \"\"interest on debt\"\", it doesn't work that way; it's a \"\"service fee\"\", otherwise it would be subject to some pretty hefty federal regulation. However, if you figure it as interest, you'd be amazed; let's say you bought lunch at a burger joint for $10. You didn't have enough in the account, but it was close, so the bank let it go - and charged you $35. You have effectively inflated the cost of that meal to $45, a 350% instantaneous price increase (or if you prefer, 350% interest on that $10); I dunno about you but if I were paying $45 for one lunch it wouldn't be at a burger joint. Most banks simply will not process a check on an already-overdrawn account, overdraft service or otherwise; they'll hit you for the overdraft fee (usually actually a fee for an NSF check) AND decline the payment. So, if you had $1 in your account and wrote a rent check for $1000, it'd still bounce even with overdraft service.\"" }, { "docid": "509266", "title": "", "text": "I just graduated from college and I am already planning my retirement. ... in terms of money sitting in my bank account post retirement, assuming Ii have $250,000 what is the highest interest that I can earn with it? Assuming you are 22, and will retire in 45 years at age 67. There is no way to predict interest rates. When I was 22 and just out of college I started putting money into a bank account to save for a down payment. The rate for a savings account was 6%. That means that every month I made 1/2 of one percent. Today that same credit union offers a money maker account with a minimum balance of $100,000 that pays 0.25% for the year. What I made in a month would take two years to make today. Keep in mind we also can't estimate your pay in the last year before retirement, or the inflation rate for the next 45 years, or the mortgage rate, or the availability of Social Security, or the returns of the S&P for 45 years. It is great you are starting to think about this today. But you will have to keep adjusting parts of your plan as the years go by: You may have to factor in children, your medical situation... Even if the interest rates recover you may not want to put all your post retirement money in the bank. Most people can't sustain the required flow of money for their 30 years of retirement from savings accounts. As for today. FDIC (or similar accounts from credit unions) will not have rates approaching 3%. It can't even approach that 3% rate via multi-year CDs. My credit union has a 6 year CD for almost 2%. If the goal of the money is safety then don't expect to find those high rates now. Some institutions may offer high rates without that FDIC protection, but that is risky." }, { "docid": "72375", "title": "", "text": "\"I think your best bet here would be HSBC. They will provide the required currencies, credit/debit cards, and very easy to use online banking transfers. This includes an online \"\"Global Account View\"\" which features all of your accounts on a single screen and allows you to \"\"drag and drop\"\" money between accounts. Regarding fees, I suspect you will need to be a \"\"Premier Account\"\" holder in order to avoid any fees imposed on transactions such as money transfers and exchanging money between currencies. In my experience HSBC offers extremely good exchange rates when exchanging \"\"large\"\" amounts of money ( greater than $10,000 / GBP 5,000 ). Exchanging small amounts will carry a larger spread but still much better than most banks offer. In my experience, exchanging GBP 5000 will have a spread of about 0.50-to-0.75 percent, while exchanging more than GBP10,000 will have a spread of as little as 0.10-to-0.20 percent. In order to qualify for a \"\"Premier Account\"\", if my memory of HSBC UK serves me correctly, you will need to have at least GBP 50,000 net across all of your HSBC managed accounts, including stockbroking and other investment accounts. In order to open a banking Swiss account, you will need to travel to Switzerland and apply in person. You cannot open a foreign bank account remotely. With a foreign investment account, I believe you can open accounts remotely. For example, I opened an account with Fidelity Switzerland using my Fidelity UK account directly from the UK, however obviously Fidelity does not provide banking services so this is not of interest to you. The simplest thing to do is to visit your local HSBC branch and discuss it with them in person. Other UK banks, such as Barclays, will also provide such services, but in my experience they are not as competitive on fees.\"" }, { "docid": "42611", "title": "", "text": "Check with your bank. As of January, 2015, the following banks and credit unions are offering free credit-scores: Announced, in the pipeline: Source: Banks to offer FICO credit scores for free Personal Experience: I've been receiving free FICO score from my credit union for more than 6 months now. Advice: Most people have multiple bank/credit-union accounts. The FICO score will be the same whoever offers it. If none of your financial institutions offer you a free credit-score then you may opt for free services like creditkarma.com or other paid services. Please note that a credit-score is number summarizing your credit-report and should not be confused. In the news:" }, { "docid": "484424", "title": "", "text": "Generally, the HSA is self-reported. The bank/financial provider will allow you to withdraw/spend whatever you want from your HSA. They report to the IRS the total that you withdrew for the year (your gross distributions) on a 1099-SA form. At tax time, you use a form 8889 to report this number of your gross distributions, and how much of it was used for medical expenses. Ideally, all of it was used for medical expenses. If it was not all for medical expenses, there will be extra taxes/penalties due. Different HSAs work differently, but for mine, which is held at a credit union, I can get money out several ways. I have an HSA checkbook and an HSA debit card that I can use anywhere. I can also transfer money out of my HSA into my regular checking account to reimburse myself for an expense, or even stop in at the teller window and take out cash. The credit union doesn't need to see any receipts for any of this. They don't care if I'm spending it at the doctor's office or the casino. It is up to me to make sure I'm spending the money in accordance to the law and that everything is reported correctly on my tax return. Nothing is verified unless you get audited. You definitely should keep documentation on the expenses, because if you are audited, you need to be prepared to account for every withdrawal. Make sure you are very familiar with the rules on eligible medical expenses, so you know what is allowed and what is not. IRS Publication 502 has all the details on what is allowed. As far as how it gets counted towards your deductible, you need to make sure that all of your medical bills get sent to your health insurance, even if you will eventually have to pay for it. For example, let's say you go to the doctor, and the bill is $150. Even if you know that the deductible is not met yet and you will be responsible for the entire $150, make sure the doctor's office submits the bill to your insurance. The insurance company will inform the doctor's office that you are responsible for all of it, but they will apply the amount towards your deductible." }, { "docid": "448981", "title": "", "text": "am I allowed to transfer into NRE account from paypal? Credits into NRE accounts are restricted. It has to be established that the funds being credited are income outside of India. In case of paypal, paypal uses local clearing to credit funds into Bank Accounts. So essentially one cannot credit NRE account by domestic clearing network like NEFT. It is best that you withdraw the funds into Bank Account outside India and use SWIFT or remittance service to credit your NRE account. I do not want to transfer to an NRO account since the money credited into it will become taxable. This is not the right assumption. Credits into NRO are not taxable by default; if you establish that the funds are from outside India, there is no tax on the income money transferred from abroad into the NRO account. However, the interest that will be paid by the bank on the balance of the NRO account is taxable income in India and is subject to TDS. In contrast, interest paid on the balance in an NRE account is not taxable in India and is not subject to TDS as long as you maintain NRI status. However it does make sense to keep accounts segregated, i.e. income generated in India, credit the NRO account and income generated outside India credit to NRE." }, { "docid": "174196", "title": "", "text": "\"have a bank account here, you need to have a credit history, That is wrong, whoever informed you that. You don't need a credit history to open a bank account. Some banks allow you to open no frills accounts without a credit history. I myself opened an account, with Barclays, with my NI card, job contract and probably my passport too and I amn't from the EU. Also, the bank that allowed me to open the account, doesn't allow me to wire transfer (my) money to another (UK) account, and claims that ll the bank have the same policy for \"\"cash accounts\"\", is that true, I mean, is there an actual law that for some reason donesn't allow you to transfer your funds? Why? Did you read the T&Cs. Chances are that other the account is with a different bank. And it always is fishy, atleast for banks because of heightened money laundering regulations, for people opening accounts and starting to transfer money to accounts with other banks. After you have banked with them for certain time, you can ask them to upgrade you to a current account which allow these services. Secondly because it might be a no frills account and they aren't allowed to charge fees, they might disallow transfers to other banks. And banks generally don't charge fees for no frills accounts so certain services are disallowed, which cost them money. NB:- I have had a cash account for 4-5 years with Barclays and I used to transfer money to other banks, but I probably never tried transferring money just after opening an account.\"" }, { "docid": "263648", "title": "", "text": "On my recent visit to the bank, I was told that money coming into the NRE account can only be foreign currency and for NRO accounts, the money can come in local currency but has to be a valid source of income (e.g. rent or investments in India). Yes this is correct as per FMEA regulation in India. Now if we use 3rd party remittances like Remitly or Transferwise etc, they usually covert the foreign currency into local currency like INR and then deposit it. The remittance services are better suited for transferring funds to Normal Savings accounts of your loved ones. Most remittance services would transfer funds using a domestic clearing network [NEFT] and hence the trace that funds originated outside of India is lost. There could be some generic remittance that may have direct tie-up with some banks to do direct transfers. How can we achieve this in either NRE/NRO accounts? If not, what are the other options ? You can do a Wire Transfer [SWIFT] from US to Indian NRE account. You can also use the remittance services [if available] from Banks where you hold NRE Account. For example RemittoIndia from HDFC for an NRE account in HDFC, or Money2India from ICICI for an NRE account in ICICI or QuickRemit from SBI etc. These would preserve the history that funds originated from outside India. Similarly you can also deposit a Foreign Currency Check into Indian Bank Account. The funds would take around month or so to get credited. All other funds can be deposited in NRO account." }, { "docid": "121230", "title": "", "text": "\"Here are some things you want to look at for evaluating a bank or credit union for your regular spending accounts: Convenience. Do they have a branch in a convenient location for you? Do they have no-fee ATMs near you? Website. If you are like me, you will spend more time on the bank's website than you do inside a branch. Some bank's websites are great, some are terrible. Unfortunately, this is generally difficult to evaluate until you actually get an account. You want a website that is easy to use. It should allow you to easily move money between your accounts, get instant lists of transactions, show you your monthly statements, and have a billpay feature that works well. If you use budgeting software that interfaces online with your bank, you want to ensure that it works well with your bank. Fee structure. Some banks will nickel-and-dime you to death. Watch out for minimum balance fees and ATM fees. Banks and credit unions usually have a fee schedule page on their website that lists every fee they charge, making it easy to compare different banks. I would not be very concerned about interest rates for savings. Currently, all savings accounts have a universally terrible interest rate. Therefore, I wouldn't base my bank choice on the interest rate. Sure, one might offer double the interest rate of another, but double \"\"next-to-nothing\"\" is still \"\"next-to-nothing.\"\" When you accumulate enough savings that you want to start maximizing your earnings, you can look for a better rate at another bank to move your savings to, and you can keep your checking account at the bank with the best convenience and fee structure. In my limited experience, I have had better luck with credit unions than with banks when it comes to fees.\"" } ]

[ { "docid": "556021", "title": "", "text": "Yes, you can do this. I do this for my own single-member LLC, but I usually do it online instead of writing a check. Your only legal obligation is to pay quarterly estimated tax payments to the IRS. I'm assuming you are not otherwise doing anything shady. For example, that you have funds in your business account to pay any expenses that will be due soon or that you are trying to somehow pull a fast one on someone else..." } ]

[ { "docid": "237039", "title": "", "text": "I've been using online billpay for years, at three different banks. Two were local (a bank and a credit union), and the other is ING Direct. I haven't had any problems with any of them that weren't self-inflicted (forgetting to enter the bill). The credit union's system is pretty clunky, but the other two are fine. One thing to make sure of is to leave enough time for the bill to arrive, just like you would do if mailing a check. Just have the bill sent a week before its due, and you should be fine. I usually do this soon after I get the bill, so I don't forget about it. ING will actually receive bills from some companies automatically, if you wish. So all you need to do is go online and click pay, and it will know when the due date is and the amount to pay. For bills that have the same amount each month (mortgage, insurance premiums, etc.), you can set it up to pay automatically each month so you don't have to do anything. Its a bit of a hassle moving banks, and reentering the account numbers, addresses, etc. Stopping a bill is as easy as clinking delete in the online system. My current setup is to have all my bills paid through ING, and my paycheck direct deposited. I can transfer money to/from my local bank in a couple of days if I have checks to deposit, or to use the local ATM. I short, I would never go back to writing paper checks." }, { "docid": "467641", "title": "", "text": "You can use xoom.com or western union. They are both pretty much the same, as they do not charge any fees but take a cut of 0.7-0.8% on every dollar. However, there is a minimum and maximum limit of sending money. If you want to transfer more, you can wire money in through a financial institution such as Wells Fargo or Chase bank or look to see if there is a State bank of India around you. I am quite sure that they charge $15 plus 0.20-0.30% on every dollar( The last time I used it). Hope this helps." }, { "docid": "68472", "title": "", "text": "My car loan, much to my disappointment, was through Wells Fargo. I went to my credit union and refinanced (with a .1% increase of interest) and I feel a lot better about my payments. In reality, it pays for itself because my credit union is customer-owned, and my dividends offset the extra cost. :)" }, { "docid": "339017", "title": "", "text": "\"Coming from someone who has worked a in the account servicing department of an actual bank in the US, other answers are right, this is probably a scam, the phone number on the letter is probably ringing to a fraudulent call center (these are very well managed and sound professional), and you must independently locate and dial the true contact number to US Bank. NOW. Tell them what happened. Reporting is critical. Securing your money is critical. Every piece of information you provided \"\"the bank\"\" when you called needs to be changed or worked around. Account numbers, passwords, usernames, card numbers get changed. Tax ID numbers get de-prioritized as an authentication mechanism even if the government won't change them. The true bank probably won't transfer you to the branch. If the front-line call center says they will, ask the person on the phone what the branch can do that they cannot. Information is your friend. They will probably transfer you to a special department that handles these reports. Apparently Union Bank's call center transfers you to the branch then has the branch make this transfer. Maybe their front-line call center team is empowered to handle it like I was. Either way, plug your phone in; if the call takes less than 5 minutes they didn't actually do everything. 5 to 8 minutes per department is more likely, plus hold time. There's a lot of forms they're filling out. What if that office is closed because of time differences? Go online and ask for an ATM limit increase. Start doing cash advances at local banks if your card allows it. Just get that money out of that account before it's in a fraudsters account. Keep receipts, even if the machine declines the transaction. Either way, get cash on hand while you wait for a new debit card and checks for the new account you're going to open. What if this was fraud, you draw your US Bank account down to zero $800 at a time, and you don't close it or change passwords? Is it over? No. Then your account WILL get closed, and you will owe EVERYTHING that the fraudsters rack up (these charges can put your account terrifyingly far in the negative) from this point forward. This is called \"\"participation in a scam\"\" in your depository agreement, because you fell victim to it, didn't report, and the info used was voluntarily given. You will also lose any of your money that they spend. What if US Bank really is closing your account? Then they owe you every penny you had in it. (Minus any fees allowed in the depository agreement). This closure can happen several days after the date on the warning, so being able to withdraw doesn't mean you're safe. Banks usually ship an official check shipped to the last known address they had for you. Why would a bank within the United States close my account when it's not below the minimum balance? Probably because your non-resident alien registration from when you were in school has expired and federal law prohibits them from doing business with you now. These need renewed at least every three years. Renewing federally is not enough; the bank must be aware of the updated expiration date. How do I find out why my account is being closed? You ask the real US Bank. They might find that it's not being closed. Good news! Follow the scam reporting procedure, open a new account (with US Bank if you want, or elsewhere) and close the old one. If it IS being closed by the bank, they'll tell you why, and they'll tell you what your next options are. Ask what can be done. Other commenters are right that bitcoin activity may have flagged it. That activity might actually be against your depository agreement. Or it set off a detection system. Or many other reasons. The bank who services your account is the only place that knows for sure. If I offer them $500 per year will they likely keep the account opened? Otherwise I got to go to singapore open another account Legitimate financial institutions in the United States don't work this way. If there is a legal problem with your tax status in the US, money to the bank won't solve it. Let's call the folks you've talked to \"\"FraudBank\"\" and the real USBank \"\"RealBank,\"\" because until RealBank confirms, we have no reason to believe that the letter is real. FraudBank will ask for money. Don't give it. Don't give them any further information. Gather up as much information from them as possible instead. Where to send it, for example. Then report that to RealBank. RealBank won't have a way to charge $500/year to you only. If they offer a type of account to everyone that costs $500, ask for the \"\"Truth in Savings Act disclosures.\"\" Banks are legally required to provide these upon request. Then read them. Don't put or keep your money anywhere you don't understand.\"" }, { "docid": "376898", "title": "", "text": "Shop around for a bank that offers lower/no fees for this operation and move your account there... or, yes, change where the direct deposit is routed... or move these accounts into a single bank so it's an internal transfer rather than ACH. Or ask the bank whether there is another way to arrange this which doesn't cost you money. (It costs me nothing to move money within my credit union, whether manually or on a scheduled basis. It costs me nothing to have them send funds to another entity from my checking account. Specific example: Pay comes into my savings account. On the 27th, an automatic transfer moves the cost of a mortgage payment from savings to checking. On the 30th, an automatic payment sends that to my mortgage in another bank. No fees on any of this, 100% reliable.)" }, { "docid": "81843", "title": "", "text": "\"StasM, It's taken a while but many banks offer tokens - although they tend to limit the accounts for which they will be issued. All of the following issue tokens, but there are many more: CitiBank JP Morgan Union Bank Wells Fargo Callaway Bank Wachovia Bank of North Dakota The River Bank of Wisconsin Metcalf Bank, Kansas Stonebridge Bank In 2005 federal regulators stipulated that banks needed to get better with security for online banking customers, but they did not endorse a particular technology. Tokens (aka fobs) were endorsed. The news was negatively received by the banks because putting more steps in the way of a customer drives the customer away. See this 2005 report for more info: http://www.usatoday.com/tech/news/computersecurity/2005-11-02-cybercrime-prevention_x.htm My guess is a tipping point was reached since then, where customers became savvy of the risks, and that the \"\"extra steps\"\" became less an issue than the \"\"extra security\"\".\"" }, { "docid": "372900", "title": "", "text": "For the requirement for risk free and hassle free account a CD or money market account through your local bank, credit union, or even large online bank will be fine. These funds won't grow very fast over time but they are safe and insured. These types of accounts are perfect for all the miscellaneous birthday, Holiday and religious event checks. There is not a requirement that the money be in a UGMA (Uniform Gifts to Minors Act) account. Putting it in a UGMA account does make it hard for the parents to spend. The IRS does allow the child to have earnings from banks without the formality of a UGMA. The money shouldn't be moved between the parent's and child's account but it is possible for the parents to spend the child's money if times are tight and the money is used for items that benefit the child. If there is a reasonable assumption of college then the 529 plan makes a lot of sense. The prepaid tuition options would be risky because they tend to be tied to a single state, and who knows where they will be living in 10 to 15 years. The 529 does focus the money to be used for educational expenses, but it can be used for non-educational expenses if you are willing to pay the taxes and penalties. It can also be transferred to another child later, or even other family members. In my state the 529 plan doesn't have to be used right after high school graduation. It can be used up to 30 years after graduation. So they can decide a few years later that they want to go back to school." }, { "docid": "278678", "title": "", "text": "\"I opened several free checking accounts at a local credit union. One is a \"\"Deposit\"\" account where all of my new money goes. I get paid every two weeks. Every other Sunday we have our \"\"Money Day\"\" where we allocate the money from our Deposit account into our other checking accounts. I have one designated as a Bills account where all of my bills get paid automatically via bill pay or auto-pay. I created a spreadsheet that calculates how much to save each Money Day for all of my upcoming bills. This makes it so the amount I save for my bills is essentially equal. Then I allocate the rest of my deposit money into my other checking accounts. I have a Grocery, Household, and Main checking accounts but you could use any combination that you want. When we're at the store we check our balances (how much we have left to spend) on our mobile app. We can't overspend this way. The key is to make sure you're using your PIN when you use your debit card. This way it shows up in real-time with your credit union and you've got an accurate balance. This has worked really well to coordinate spending between me and my wife. It sounds like it's a lot of work but it's actually really automated. The best part is that I don't have to do any accounting which means my budget doesn't fail if I'm not entering my transactions or categorizing them. I'm happy to share my spreadsheet if you'd like.\"" }, { "docid": "5644", "title": "", "text": "\"Your instructor's numbers do not seem to have any basis in current reality. At this page you can see a comparison of interest rates offered by banks and credit unions. In the most recent table for June 2014, banks paid an average interest rate of 0.12 percent on savings accounts, while credit unions paid an average of 0.13 percent. If you look back further, you will see that interest rates paid by banks and credit unions are generally comparable. Credit union rates tend to be a little bit higher, but certainly not 7 times higher. The last time any financial institution paid as much as 15% on a savings account would probably be the early 1980s. You can see here a historical chart of the \"\"prime rate\"\" for lending. Savings account rates (at either banks or credit unions) would typically be lower. (This is based on the US, in accordance with your tag. Interest rates in other places, especially developing countries with less stable currencies, can be dramatically different.)\"" }, { "docid": "15262", "title": "", "text": "\"Other responses have focused on getting you software to use, but I'd like to attempt your literal question: how are such transactions managed in systems that handle them? I will answer for \"\"double entry\"\" bookkeeping software such as Quicken or GnuCash (my choice). (Disclaimer: I Am Not An Accountant and accountants will probably find error in my terminology.) Your credit card is a liability to you, and is tracked using a liability account (as opposed to an asset account, such as your bank accounts or cash in your pocket). A liability account is just like an asset except that it is subtracted from rather than added to your total assets (or, from another perspective, its balance is normally negative; the mathematics works out identically). When you make a purchase using your credit card, the transaction you record transfers money from the liability account (increasing the liability) to the expense account for your classification of the expense. When you make a payment on your credit card, the transaction you record transfers money from your checking account (for example) to the credit card account, reducing the liability. Whatever software you choose for tracking your money, I strongly recommend choosing something that is sufficiently powerful to handle representing this as I have described (transfers between accounts as the normal mode of operation, not simply lone increases/decreases of asset accounts).\"" }, { "docid": "72375", "title": "", "text": "\"I think your best bet here would be HSBC. They will provide the required currencies, credit/debit cards, and very easy to use online banking transfers. This includes an online \"\"Global Account View\"\" which features all of your accounts on a single screen and allows you to \"\"drag and drop\"\" money between accounts. Regarding fees, I suspect you will need to be a \"\"Premier Account\"\" holder in order to avoid any fees imposed on transactions such as money transfers and exchanging money between currencies. In my experience HSBC offers extremely good exchange rates when exchanging \"\"large\"\" amounts of money ( greater than $10,000 / GBP 5,000 ). Exchanging small amounts will carry a larger spread but still much better than most banks offer. In my experience, exchanging GBP 5000 will have a spread of about 0.50-to-0.75 percent, while exchanging more than GBP10,000 will have a spread of as little as 0.10-to-0.20 percent. In order to qualify for a \"\"Premier Account\"\", if my memory of HSBC UK serves me correctly, you will need to have at least GBP 50,000 net across all of your HSBC managed accounts, including stockbroking and other investment accounts. In order to open a banking Swiss account, you will need to travel to Switzerland and apply in person. You cannot open a foreign bank account remotely. With a foreign investment account, I believe you can open accounts remotely. For example, I opened an account with Fidelity Switzerland using my Fidelity UK account directly from the UK, however obviously Fidelity does not provide banking services so this is not of interest to you. The simplest thing to do is to visit your local HSBC branch and discuss it with them in person. Other UK banks, such as Barclays, will also provide such services, but in my experience they are not as competitive on fees.\"" }, { "docid": "453025", "title": "", "text": "If it's just an ordinary credit card I'd think he could merely dispute the charges, since he's saying they 'created' (which I presume means applied for and received) a card, it should not affect his accounts directly. And especially since application details may be bogus, he should be able to prove it was not him. Even if they got HIS credit card number, he should be able to dispute those charges that are not his, especially if they went to a different address, or were charged someplace (like another city) where he was not present at that time. OTOH, if they created a DEBIT card that was linked to his bank account somehow, well then, that could be a lot more difficult to recover from, but even then, if it's not his signature that was used to apply for the card, or on any charges that had to be signed for etc, he should be able to dispute it and get the bank to put the money back in his account since it will be a case of forgery etc. The big problem with ID theft is people tend to ruin your credit rating, and you end up having to fend off bill collectors etc. The primary thing it costs you (speaking from experience of having checks stolen and forged using a fake drivers license) is the TIME and hassle of getting everything straightened out and put right. In my case it took a few hours at the credit union, and all the money was back, in a new account (the old one having been closed) when I left. Dealing with all the poor merchants that were taken, and with bill collectors on the other hand took months. but I never once in the process needed 'quick money' from anyone. So the need for 'quick money' seems a bit doubtful. I'd want a lot more details of exactly why he needs money from you. Refer your friend to this Federal Trade Commission site and make sure he takes the steps listed, and especially pays attention to the parts about keeping notes of every single person he talks with, including name, date, time, and pertinent details of the conversation. If he has some idea HOW this happened (as in a robbery) then report it to the proper authorities, and insist on getting a case number. talking with bill collectors is the worst, just trying to get ahold of them when they send you letters (and talk to a person, not a recorded number with instructions on how to pay them) is sometimes nearly impossible (google was my friend) and a lot of times they didn't want to back off till I gave them the case number with the police, that somehow magically made it 'real' to them and not just my telling them a story." }, { "docid": "346852", "title": "", "text": "\"I don't think credit cards support depositing money into to begin with. Anyone could deposit money to a Credit Card acccount. All they need is your bank's name, Visa/Mastercard, and 16 digit number. It is done through the \"\"Pay Bills / Make Payments\"\" function in online banking. So tell me, what does it mean that PayPal will transfer the money to my VISA card You can use the new balance for spending via Credit Card, the effect is same as making a payment from your chequing account to credit card account. Will it simply just get transferred to my bank account by the local bank after that Some banks would refund the excess amount from your Credit Card to your Chequing Account after a while, but most don't. People keep credit balance on credit card to make a purchaes larger than credit limit. For example, if your credit limit is $1000, balance is $0, and you made $500 payment to the credit card, you can make a purchase of $1500 without asking for credit limit increase.\"" }, { "docid": "184386", "title": "", "text": "\"I'm not sure I understand your question, but I'll try to answer what I think you're asking. I think you're asking this: \"\"A US bank receives a wire transfer from a Chinese bank. How does the US bank ensure there's any money in fact arriving before crediting the destination account?\"\" Well, the way wire transfers work is that the US bank would debit the senders' account with that US bank. So the US bank in fact transfers the money between two internal accounts: debit to the Chinese bank's account with that US bank and credit the destination customer account. If the Chinese bank doesn't have an account with the destination US bank - a third party intermediary is used that both banks have accounts with. Such third party will charge an additional fee (hence sometimes the wire transfer fees are slightly higher than you initially know when sending the money, the third party would debit from the transfer amount). \"\"Regular\"\" IBAN/ACH transfers work through regulatory channels that ensure integrity and essentially use a regulatory bank as that third party. But because they're done in batches and not on-line, they're much cheaper, and the accounting is for the whole batch and not each transfer separately. But batch processing means it will take a day or two of processing, while wire transfer takes hours at most.\"" }, { "docid": "1897", "title": "", "text": "Wire transfers normally run through either the Fedwire system or the Clearing House Interbank Payments System (CHIPS). The process generally works like this: You approach a bank or other financial institution and ask to transfer money. You give the bank a certain code, either an international bank account number or one of several other standards, which informs the bank where to send the money. The bank sends a message through a system like Fedwire to the receiving bank, along with settlement instructions. This is where the process can get a bit tricky. For the wire transfer to work, the banks must have reciprocal accounts with each other, or the sending bank must send the money to a bank that does have such an account with the receiver. If the sending bank sends the money to a third-party bank, the transaction is settled between them, and the money is then sent to the receiving bank from the third-party bank. This last transaction may be a wire transfer, ACH transfer, etc. The Federal Reserve fits into this because many banks hold accounts for this purpose with the Federal Reserve. This allows them to use the Fed as the third-party bank referred to above. Interestingly enough, this is one of the significant ways in which the Fed makes a profit, because it, along with every other bank and routing agent in the process, collects a miniscule fee on this process. You'll often find sources that state that Fedwire is only for transferring large transactions; while this is technically correct, it's important to understand that financial institutions don't settle every wire transfer or payment immediately. Although the orders are put in immediately, the financial institutions settle their transactions in bulk at the end of the business day, and even then they normally only settle the difference. So, if Chase owes Bank of America $1M, and Bank of America owes Chase $750K, they don't send these as two transactions; Chase simply credits BAC $250K. You didn't specifically ask about ACH transfers, which as littleadv pointed out, are different from wire transfers, but since ACH transfers can often form a part of the whole process, I'll explain that process too. ACH is a payment processing system that works through the Federal Reserve system, among others. The Federal Reserve (through the Fedline and FedACH systems) is by far the largest payment processor. The physical cash itself isn't transferred; in simple terms, the money is transferred through the ACH system between the accounts each bank maintains at the Federal Reserve. Here is a simple example of how the process works (I'm summarizing the example from Wikipedia). Let's say that Bob has an account with Chase and wants to get his paycheck from his employer, Stack Exchange, directly deposited into this account. Assume that Stack Exchange uses Bank of America as their bank. Bob, the receiver, fills out a direct deposit authorization form and gives it to his employer, called the originator. Once the originator has the authorization, they create an entry with an Originating Depository Financial Institution, which acts as a middleman between a payment processor (like the Federal Reserve) and the originator. The ODFI ensures that the transaction complies with the relevant regulations. In this example, Bank of America is the ODFI. Bank of America (the ODFI) converts the transaction request into an ACH entry and submits it, through an ACH operator, to the Receiving Depository Financial Institution (RDFI), which in this case is Chase bank. Chase credits (deposits) the paycheck in Bob's account. The Federal Reserve fits into all of this in several ways. Through systems like Fedline and FedACH, the Fed acts as an ACH operator, and the banks themselves also maintain accounts at the Federal Reserve, so it's the institution that actually performs the settling of accounts between banks." }, { "docid": "20670", "title": "", "text": "\"•Have you had any problems with bills not being paid? NO •If you had issues, were they addressed satisfactorily? Answer: A big issue that blindsided me: With my bank, the funds come out of my account right away, but the actual payment is done through a third-party service. On my bank's online site it appears that the payment has been made, but that does not necessarily mean that the intended recipient has cashed it. Looking online at my credit union's site is useless, because all I can tell is that the payment has been sent. The only way to verify payment is to contact the intended recipient. Or I may telephone the online bill pay representative at my bank/credit union, who has access to the third party service. If I do nothing, after 90 days, the check is void, at which time the third party service notifies the bank/credit union and the funds will eventually end up back in my account. I learned this today, after a third-party paper check to a health care provider was returned to me via mail by the recipient (because insurance had already paid and I did not owe them anything). The money was in the hands of the third-party service, not in my account, nor that of my credit union nor the recipient. At first my credit union told me that I would have to contact the third-party service myself and work it out. I said \"\"NO WAY\"\" and the credit union did get the money back into account the same day. This is a sweet deal for the third party, who has my money interest-free anywhere from a few days to three months. And risk-free as well, because the money goes directly from my account to the third party service.\"" }, { "docid": "171339", "title": "", "text": "\"One of the factors of a credit score is the \"\"length of time revolving accounts have been established\"\". Having a credit card with any line of credit will help in this regard. The account will age regardless of your use or utilization. If you are having issues with credit limits and no credit history, you may have trouble getting financing for the purchase. You should be sure you're approved for financing, and not just that the financing option is \"\"available\"\" (potentially with the caveat of \"\"for well qualified borrowers\"\"). Generally, if you've gotten approved for financing, that will come in the form of another credit card account (many contracting and plumbing companies will do this in hopes you will use the card for future purchases) or a bank loan account (more common for auto and home loans). With the credit card account, you might be able to perform a balance transfer, but there are usually fees associated with that. For bank loan accounts, you probably can't pay that off with a credit card. You'll need to transfer money to the account via ACH or send in a check. In short: I wouldn't bet on paying with your current credit card to get any benefit. IANAL. Utilizing promotional offers, whether interest-free for __ months, no balance transfer fees, or whatever, and passing your debt around is not illegal, not fraudulent, and in many cases advised (this is a link), though that is more for people to distribute utilization across multiple cards, and to minimize interest accrued. Many people, myself included, use a credit card for purchasing EVERYTHING, then pay it off in full every month (or sometimes immediately) to reap the benefit of cash back rewards and other cardholder benefits. I've also made a major payment (tuition, actually) on a Discover card, and opened up a new Visa card with 18-months of no interest and no balance transfer fees to let the bill sit for 12 months while I finished school and got a job.\"" }, { "docid": "482385", "title": "", "text": "Wells Fargo. They have an account called PMA, an umbrella account for checking, savings, mortgage, and brokerage accounts. It would cost $30/month, but I never had to pay because I have a rollover retirement account that is enough to waive the fees. They count all accounts, including mortgage, which I used to have. Oh, and no restrictions. An added advantage is there are no fees for any of the accounts, nor for some other things, like bank checks, outside ATM fees, etc. I'm in California, so I don't know if the same deal exists in other states. But if you qualify for the free account, it's pretty good. Actually, most of my investments are Vanguard funds. And I have another rollover account with Vanguard, and never pay fees, but I only buy or sell from one Vanguard fund to another, and rarely since I have targeted retirement funds that are designed to be no maintenance. For some reason, I trust Vanguard more than most other funds; maybe because I like their philosophy on low-cost funds, which they started but are now getting more popular." }, { "docid": "584258", "title": "", "text": "Yes this is a huge security loophole and many banks will do nothing to refund if you are scammed. For example for business accounts some Wells Fargo branches say you must notify within 24 hours of any check withdrawal or the loss is yours. Basically banks don't care - they are a monopoly system and you are stuck with them. When the losses and complaints get too great they will eventually implement the European system of electronic transfers - but the banks don't want to be bothered with that expense yet. Sure you can use paypal - another overpriced monopoly - or much better try Dwolla or bitcoin." } ]

[ { "docid": "555097", "title": "", "text": "Making a payment of any amount is usually legal, although of course the specific circumstances matter, and I'm not qualified to give legal advice. Just had to throw in that disclaimer not because I think there's a problem here, but because it is impossible to give a definite answer to a legal question in a specific situation on Stack Exchange. But the government will be involved. There are two parts to that. First, as part of anti-money-laundering laws, banks have to report all transactions above a certain limit; I believe $10k. When you use a check or similar to pay, that happens pretty much automatically. When making a cash payment, you may have to fill out some forms. An secondly, Edward Snowden revealed that the government also tapped into banking networks, so pretty much every transaction is recorded, even if it is not reportable." } ]

[ { "docid": "453371", "title": "", "text": "This is not allowed, and there is a name for it: IBAN discrimination. Searching for that term will give you some pointers what to do about it. The EU regulation that prohibits this is 260/2012, article 9, paragraph 2: A payee accepting a credit transfer or using a direct debit to collect funds from a payer holding a payment account located within the Union shall not specify the Member State in which that payment account is to be located, provided that the payment account is reachable in accordance with Article 3. You can report this at the relevant national authorities. In the Netherlands, this is De Nederlandsche Bank, which has a special e-mail address for this: [email protected]" }, { "docid": "15262", "title": "", "text": "\"Other responses have focused on getting you software to use, but I'd like to attempt your literal question: how are such transactions managed in systems that handle them? I will answer for \"\"double entry\"\" bookkeeping software such as Quicken or GnuCash (my choice). (Disclaimer: I Am Not An Accountant and accountants will probably find error in my terminology.) Your credit card is a liability to you, and is tracked using a liability account (as opposed to an asset account, such as your bank accounts or cash in your pocket). A liability account is just like an asset except that it is subtracted from rather than added to your total assets (or, from another perspective, its balance is normally negative; the mathematics works out identically). When you make a purchase using your credit card, the transaction you record transfers money from the liability account (increasing the liability) to the expense account for your classification of the expense. When you make a payment on your credit card, the transaction you record transfers money from your checking account (for example) to the credit card account, reducing the liability. Whatever software you choose for tracking your money, I strongly recommend choosing something that is sufficiently powerful to handle representing this as I have described (transfers between accounts as the normal mode of operation, not simply lone increases/decreases of asset accounts).\"" }, { "docid": "88867", "title": "", "text": "My wife and I do this. We have one account for income and one for expenditures (and around 7 others for dedicated savings.) Doing this we are forcing ourselves to keep track of all expenditures as we have to manually transfer funds from one to the other, we try to do this periodically (every Wednesday) and then keep the expenditures within what is actually on the account. It is a really good way to keep track of everything. Bear in mind that our bank provides a fast handy smartphone app where we both can check our account as well as transfer funds in less than 10 seconds. (Fingerprint authentication, instant funds transfer as well as zero fees for transfers.) Right now we have a credit card each attached to the expenditures account, but earlier we only had a debit card each and no credit cards. Meaning that when the weekly funds ran out we where simply not able to pay. We did this to mimic living only on cash and when the cash runs out you simply have to stop buying stuff. And at the same time we could accrue quite a bit of savings. I would definitely recommend this if you have problems with over expenditures." }, { "docid": "48866", "title": "", "text": "I have been using Bill Pay from BoA, Chase, and a local Credit Union, all for at least five years (maybe even 10), and never had any issues with lost checks. Sometimes, an address given to me was incorrect, and what happens is either nothing (meaning, after 90 days, the check is considered outdated and the money gets reimbursed in the account) the bank notifies me after about two weeks that the check was returned as 'recipient not found at that address' or 'invalid address', and the money gets restored right then. That is no guarantee, of course, that nothing will ever happen. But banks are not supposed to accept checks where the recipient name does not match. Also, you should consider using 'Quick Pay' or 'Pay an individual' instead, whatever your bank calls it. That will transfer the money same or next day to your other account, without ever mailing a check. You do not need to enter account information across banks, it works by both banks contacting you through your logins/emails." }, { "docid": "202570", "title": "", "text": "I think you are asking quite a few questions here; If you have Rs 10000, its better you get it converted in India before you leave. Most Banks and Exchange houses like Western Union would take Rupees and Give you USD. What do they do with USD, there are other who give them USD and need Rupees. They make a spread in this process. If you are getting a salary in USD in US, whenever you want to transfer money to India, the Banks or Remittance services like Western Union would take USD from your US Account and Transfter equivalent Money into your Bank Account in India in Rupees. They will tell the exchange rate applicable. Depending on why visa type & the duration you are going, your company should be able to tell you your tax liabilities in the US. Read similar questions here to get a general idea." }, { "docid": "385343", "title": "", "text": "\"How would having a 20% down payment change the conversation for you? And who are you looking to get a mortgage from? If you go to a local community bank or credit union, you might have a better chance explaining your situation and having them take that into account rather than going to one of the mega-banks (Bank of America, Chase, Wells Fargo, etc) who may only look at your FICO score when making a lending decision. The thing to keep in mind is \"\"how much of a risk are you to the lending institution?\"\" If you have a strong down payment 15% to 20%, you will be a much better candidate. Bear in mind, anything less than 20% down will require PMI (Private Mortgage Insurance, which I think runs a certain dollar amount per $1k you have borrowed). If you have a strong downpayment, and the only debts you have are your student loans (which will be paid off in five years anyway), then you are far less risky than someone in a similar situation with more debt.\"" }, { "docid": "584258", "title": "", "text": "Yes this is a huge security loophole and many banks will do nothing to refund if you are scammed. For example for business accounts some Wells Fargo branches say you must notify within 24 hours of any check withdrawal or the loss is yours. Basically banks don't care - they are a monopoly system and you are stuck with them. When the losses and complaints get too great they will eventually implement the European system of electronic transfers - but the banks don't want to be bothered with that expense yet. Sure you can use paypal - another overpriced monopoly - or much better try Dwolla or bitcoin." }, { "docid": "72375", "title": "", "text": "\"I think your best bet here would be HSBC. They will provide the required currencies, credit/debit cards, and very easy to use online banking transfers. This includes an online \"\"Global Account View\"\" which features all of your accounts on a single screen and allows you to \"\"drag and drop\"\" money between accounts. Regarding fees, I suspect you will need to be a \"\"Premier Account\"\" holder in order to avoid any fees imposed on transactions such as money transfers and exchanging money between currencies. In my experience HSBC offers extremely good exchange rates when exchanging \"\"large\"\" amounts of money ( greater than $10,000 / GBP 5,000 ). Exchanging small amounts will carry a larger spread but still much better than most banks offer. In my experience, exchanging GBP 5000 will have a spread of about 0.50-to-0.75 percent, while exchanging more than GBP10,000 will have a spread of as little as 0.10-to-0.20 percent. In order to qualify for a \"\"Premier Account\"\", if my memory of HSBC UK serves me correctly, you will need to have at least GBP 50,000 net across all of your HSBC managed accounts, including stockbroking and other investment accounts. In order to open a banking Swiss account, you will need to travel to Switzerland and apply in person. You cannot open a foreign bank account remotely. With a foreign investment account, I believe you can open accounts remotely. For example, I opened an account with Fidelity Switzerland using my Fidelity UK account directly from the UK, however obviously Fidelity does not provide banking services so this is not of interest to you. The simplest thing to do is to visit your local HSBC branch and discuss it with them in person. Other UK banks, such as Barclays, will also provide such services, but in my experience they are not as competitive on fees.\"" }, { "docid": "278678", "title": "", "text": "\"I opened several free checking accounts at a local credit union. One is a \"\"Deposit\"\" account where all of my new money goes. I get paid every two weeks. Every other Sunday we have our \"\"Money Day\"\" where we allocate the money from our Deposit account into our other checking accounts. I have one designated as a Bills account where all of my bills get paid automatically via bill pay or auto-pay. I created a spreadsheet that calculates how much to save each Money Day for all of my upcoming bills. This makes it so the amount I save for my bills is essentially equal. Then I allocate the rest of my deposit money into my other checking accounts. I have a Grocery, Household, and Main checking accounts but you could use any combination that you want. When we're at the store we check our balances (how much we have left to spend) on our mobile app. We can't overspend this way. The key is to make sure you're using your PIN when you use your debit card. This way it shows up in real-time with your credit union and you've got an accurate balance. This has worked really well to coordinate spending between me and my wife. It sounds like it's a lot of work but it's actually really automated. The best part is that I don't have to do any accounting which means my budget doesn't fail if I'm not entering my transactions or categorizing them. I'm happy to share my spreadsheet if you'd like.\"" }, { "docid": "509266", "title": "", "text": "I just graduated from college and I am already planning my retirement. ... in terms of money sitting in my bank account post retirement, assuming Ii have $250,000 what is the highest interest that I can earn with it? Assuming you are 22, and will retire in 45 years at age 67. There is no way to predict interest rates. When I was 22 and just out of college I started putting money into a bank account to save for a down payment. The rate for a savings account was 6%. That means that every month I made 1/2 of one percent. Today that same credit union offers a money maker account with a minimum balance of $100,000 that pays 0.25% for the year. What I made in a month would take two years to make today. Keep in mind we also can't estimate your pay in the last year before retirement, or the inflation rate for the next 45 years, or the mortgage rate, or the availability of Social Security, or the returns of the S&P for 45 years. It is great you are starting to think about this today. But you will have to keep adjusting parts of your plan as the years go by: You may have to factor in children, your medical situation... Even if the interest rates recover you may not want to put all your post retirement money in the bank. Most people can't sustain the required flow of money for their 30 years of retirement from savings accounts. As for today. FDIC (or similar accounts from credit unions) will not have rates approaching 3%. It can't even approach that 3% rate via multi-year CDs. My credit union has a 6 year CD for almost 2%. If the goal of the money is safety then don't expect to find those high rates now. Some institutions may offer high rates without that FDIC protection, but that is risky." }, { "docid": "21174", "title": "", "text": "Dude- my background is in banking specifically dealing with these scenarios. Take my advice-look for a balance transfer offer-credit card at 0%. Your cost of capital is your good credit, this is your leverage. Why pay 4.74% when you can pay 0%. Find a credit card company with a balance transfer option for 0%. Pay no interest, and own the car outright. Places to start; check the mail, or check your bank, or check local credit unions. Some credit unions are very relaxed for membership, and ask if they have zero percent balance transfers. Good Luck!" }, { "docid": "213537", "title": "", "text": "in my experience no-cash transactions are the best deal. Take your Portuguese credit card, get some cash ($60) for emergencies. Only pay with your credit card. It's much cheaper because it's all virtual. The best would be to set up an American bank account and transfer the money there. You can also get Paypal account, they offer credit cards too. The virtual banks, credit unions are the best option because they don't charge you for transactions. They don't have expenses with keeping actual money. Find some credit Union that accepts foreigners and take it from there. You can exchange your money on the airport because it's in tax free zone. I recommend the country of the currency since they sell you their 'valuts' and you are buying dollars. Not selling Euros... Make sure to find out what is the best deal." }, { "docid": "184386", "title": "", "text": "\"I'm not sure I understand your question, but I'll try to answer what I think you're asking. I think you're asking this: \"\"A US bank receives a wire transfer from a Chinese bank. How does the US bank ensure there's any money in fact arriving before crediting the destination account?\"\" Well, the way wire transfers work is that the US bank would debit the senders' account with that US bank. So the US bank in fact transfers the money between two internal accounts: debit to the Chinese bank's account with that US bank and credit the destination customer account. If the Chinese bank doesn't have an account with the destination US bank - a third party intermediary is used that both banks have accounts with. Such third party will charge an additional fee (hence sometimes the wire transfer fees are slightly higher than you initially know when sending the money, the third party would debit from the transfer amount). \"\"Regular\"\" IBAN/ACH transfers work through regulatory channels that ensure integrity and essentially use a regulatory bank as that third party. But because they're done in batches and not on-line, they're much cheaper, and the accounting is for the whole batch and not each transfer separately. But batch processing means it will take a day or two of processing, while wire transfer takes hours at most.\"" }, { "docid": "41012", "title": "", "text": "There is no difference in safety form the perspective of the bank failing, due to FDIC/NCUA insurance. However, there is a practical issue that should be considered, if you allow payments to be automatically withdrawn from your checking account In the case of an error, all of you money may be unavailable until the error is resolved, which could be days or weeks. By having two accounts, this possibility may be reduced. It isn't a difference between checking and savings, but a benefit of having two accounts. Note that if both accounts are at the same bank, hey make take money from other accounts to cover the shortfall. That said, I've done this for years and have never had a problem. Also, I have two accounts, one at a local credit union with just enough kept in it to cover any payments, and another online account that has the rest of my savings. I can easily transfer funds between the two accounts in a couple days." }, { "docid": "224057", "title": "", "text": "There is a 3rd option: take the cash back offer, but get the money from a auto loan from your bank or credit union. The loan will only be for. $22,500 which can still be a better deal than option B. Of course the monthly payment can make it harder to qualify for the mortgage. Using the MS Excel goal seek tool and the pmt() function: will make the total payment equal to 24K. Both numbers are well above the rates charged by my credit union so option C would be cheaper than option B." }, { "docid": "16068", "title": "", "text": "I have not opened any NRE/NRO account before coming to Finland. This is in violation of Foreign Exchange Management Act. Please get this regularized ASAP. All your savings account need to be converted to NRO. Shall I transfer funds from abroad to both NRE and NRO account or I can transfer only to NRE account in India? You can transfer to NRE or NRO. It is advisable to transfer into NRE as funds from here can be repatriated out of India without any paperwork. Funds from NRO account need paperwork to move out of India. I am a regular tax payer in abroad. The Funds which i'll transfer in future will attract any additional tax in India? As your status is Non Resident and the income is during that period, there is no tax applicable in India on this. Few Mutual Fund SIPs (monthly basis) are linked with my existing saving account in india. Do these SIPs will stop when the savings account will turn into NRO account? Shall I need to submit any documents for KYC compliance? If yes, to whom I should submit these? is there any possibility to submit it Online? Check your Bank / Mutual Fund company. Couple of FDs are also opened online and linked with this existing saving account. Do the maturity amount(s) subject to TDS or any tax implication such as 30.9% as this account will be turned into NRO account till that time and NRO account attracts this higher tax percentage. These are subject to taxes in India. This will be as per standard tax brackets. Which account (NRE/NRO) is better for paying EMIs for Home Loan, SIPs of Mutual Funds, utility bills in India, transfer money to relative's account etc Home Loan would be better from NRE account as if you sell the house, the EMI paid can be credited into NRE account and you can transfer this out of India without much paperwork. Same for SIP's. For other it doesn't really matter as it is an expense. Is there any charge to transfer fund from NRE to NRO account if both account maintain in same Bank same branch. Generally No. Check with your bank. Which Bank account's (NRE/NRO) debit/ATM card should be used in Abroad in case of emergency. Check with your bank. NRE funds are more easy. NRO there will be limits and reporting. Do my other savings accounts, maintained in different Banks, also need to be converted into NRO account? If yes, how can it be done from Abroad? Yes. ASAP. Quite a few leading banks allow you to do this if you are not present. Check you bank for guidance." }, { "docid": "237039", "title": "", "text": "I've been using online billpay for years, at three different banks. Two were local (a bank and a credit union), and the other is ING Direct. I haven't had any problems with any of them that weren't self-inflicted (forgetting to enter the bill). The credit union's system is pretty clunky, but the other two are fine. One thing to make sure of is to leave enough time for the bill to arrive, just like you would do if mailing a check. Just have the bill sent a week before its due, and you should be fine. I usually do this soon after I get the bill, so I don't forget about it. ING will actually receive bills from some companies automatically, if you wish. So all you need to do is go online and click pay, and it will know when the due date is and the amount to pay. For bills that have the same amount each month (mortgage, insurance premiums, etc.), you can set it up to pay automatically each month so you don't have to do anything. Its a bit of a hassle moving banks, and reentering the account numbers, addresses, etc. Stopping a bill is as easy as clinking delete in the online system. My current setup is to have all my bills paid through ING, and my paycheck direct deposited. I can transfer money to/from my local bank in a couple of days if I have checks to deposit, or to use the local ATM. I short, I would never go back to writing paper checks." }, { "docid": "408166", "title": "", "text": "&gt;I shudder to think of the security at small bank websites, frankly. I had a local credit union for years as my main account and before that I had TD Bank. I 100% trust my local credit union over TD Bank any day to protect me from foreign intrusion or fraud." }, { "docid": "175524", "title": "", "text": "There are banks and credit unions that don't charge fee for incoming wire transfer. You most likely won't get that from big brick and mortar banks like BofA, Citi but if you are doing it regularly, using another bank that offers it free would save you a lot. Since ACH are free, you can transfer money between those banks to your regular bank (e.g. BofA) for free. There would be delay involved in this process due to additional ACH. You could also use one these banks as your primary bank to avoid that delay. Credit unions are also generally fee friendly and many would offer free incoming wire transfer. However you are limited to what is available to you as all of them would have some membership criteria." } ]

[ { "docid": "237392", "title": "", "text": "" } ]

[ { "docid": "275171", "title": "", "text": "\"I (and probably most considering trading) had a similar thought as you. I thought if I just skimmed the peaks and sold before the troughs, perhaps aided by computer, I'd be able to make a 2% here, 2% there, and that would add up quickly to a nice amount of money. It almost did seem \"\"foolproof\"\". Then I realized that sometimes a stock just slides...down...and there is no peak higher than what I bought it for. \"\"That's OK,\"\" I'd think, \"\"I'm sure it will recover and surpass the price I bought it for...so now I play the waiting game.\"\" But then it continues sliding, and my $10k is now worth $7k. Do I sell? Did I build a stop loss point into my computer program? If so, what is the right place to put that stop? What if there is a freak dip down and it triggers the stop loss but THEN my stock recovers? I just lost $14,000 like this last week--luckily, only virtually! The point is, your idea only has half a chance to work when there is a mildly volatile stock that stays around some stable baseline, and even then it is not easy. And then you factor in fees as others mentioned... People do make money doing this (day traders), and some claim you can use technical analysis to time orders well, so if you want to try that, read about technical analysis on this site or elsewhere.\"" }, { "docid": "525390", "title": "", "text": "\"A company has 100,000 shares and 100,000 unexercised call options (company issued). Share price and strike price both at $1. What country is this related to? I ask because, in the US, most people I know associate a \"\"call\"\" option with the instrument that is equivalent to 100 shares. So 100,000 calls would be 10,000,000 shares, which exceeds the number of shares you're saying the company has. I don't know if that means you pulled the numbers out of thin air, or whether it means you're thinking of a different type of option? Perhaps you meant incentive stock options meant to be given to employees? Each one of those is equivalent to a single share. They just aren't called \"\"call options\"\". In the rest of my answer, I'm going to assume you meant stock options. I assume the fact that these options exist will slow any price increases on the underlying shares due to potential dilution? I don't think the company can just create stock options without creating the underlying shares in the first place. Said another way, a more likely scenario is that company creates 200,000 shares and agrees to float 50% of them while reserving the other 50% as the pool for incentive employee stock. They then choose to give the employees options on the stock in the incentive pool, rather than outright grants of the stock, for various reasons. (One of which is being nice to the employees in regards to taxes since there is no US tax due at grant time if the strike price is the current price of the underlying stock.) An alternative scenario when the company shares are liquidly traded is that the company simply plans to buy back shares from the market in order to give employees their shares when options are exercised. In this case, the company needs the cash on hand, or cash flow to take money from, to buy those shares at current prices. Anyway, in either case, there is no dilution happening WHEN the options get exercised. Any dilution happened before or at the time the options were created. Meaning, the total number of shares in the company was already pre-set at an earlier time. As a result, the fact that the options exist in themselves will not slow price changes on the stock. However, price changes will be impacted by the total float of shares in the company, or the impact to cash flow if the company has to buy shares to redeem its option commitments. This is almost the same thing you're asking about, but it is technically different as to timing. If this is the case, can this be factored into any option pricing models like black-scholes? You're including the effect just by considering the total float of shares and net profits from cash flow when doing your modelling.\"" }, { "docid": "343231", "title": "", "text": "I'm with several of the others answering the question in that it isn't about opportunity cost so much as the value of the time savings. For example: I'm sure I could re-shingle my roof and save a ton of money on labor, but the marginal cost of having someone do that for me in the 100+ degree Texas heat makes it worthwhile to outsource that job. How much I could have earned at my job for however many hours it takes doesn't really play into it unless I am specifically giving up an opportunity to earn money instead of working on my roof. For example, it might tilt the balance more towards outsourcing the roof job if I had an offer for contract work at $100/hr that I wouldn't have time to do if I worked on the roof. Also, considering the time I'd probably take off from work to do the job is paid vacation it isn't like I'm giving up some of my paycheck to do that job. The real variable is how much value I assign to being able to NOT work on my vacation days. The bottom line is this: What your time is worth is variable and depends on the REALISTIC opportunity cost of using that time on a money making endeavor instead of the option you are considering." }, { "docid": "24306", "title": "", "text": "Although I posted this question more than a year ago, I subsequently read information which may be of use as an answer, specifically regarding Pritchard Stockbrokers in the UK several years ago, in which the FSCS stepped in to compensate investors, as detailed in the following: http://www.fscs.org.uk/what-we-cover/questions-and-answers/qas-about-pritchard-stock-6n940n01k/ http://www.ft.com/cms/s/0/89957c56-21e4-11e3-9b55-00144feab7de.html#axzz3crZYbGZ9 For reference, in case the links above are at some point in future taken offline, the FSCS FAQ states: Q: I had “deposited” money with Pritchard so can I expect £85,000 compensation from FSCS? A: No. Pritchard was not a deposit-taker so the money held does not qualify under regulatory rules as a deposit. The money will be treated as an investment, which carries maximum FSCS compensation of £50,000 per person. FSCS has no discretion to pay any more. Q: What happens if my losses are over the FSCS maximum of £50,000 and I accept the FSCS’s compensation? A: If you choose to accept compensation from FSCS, you will be required to assign (or legally transfer) to FSCS all of your rights to claim in the Administration. FSCS will then claim in the Administration standing “in your shoes” and will claim for the whole of your loss, even if it was over £50,000. When FSCS receives the dividends in your place it will then pay to you any amounts recovered to ensure that you do not suffer a disadvantage for having accepted FSCS compensation first. Example 1: Loss = £80,000 FSCS compensation = £50,000 Dividend of 50p/£ received by FSCS = £40,000 FSCS pays £30,000 to claimant so he is fully compensated (total £80,000), and retains £10,000 recovery for itself Example 2: Loss = £100,000 FSCS compensation = £50,000 Dividend of 50p/£ received by FSCS = £50,000 FSCS pays £50,000 to claimant so he is fully compensated (total £100,000), and retains nothing for itself FSCS does not have to have make a full recovery of its £50,000 before it starts paying its dividend recovery on to claimants. Claimants are not compelled to claim from FSCS, or to accept the FSCS offer of compensation. If a person does not want to transfer his legal rights to claim in the Administration to FSCS in return for accepting the payment of compensation, then s/he can decline our compensation and continue his claim in the Administration. After s/he has received the dividend(s), s/he can then return to FSCS to claim for any remaining shortfall. Therefore, the answer provided by @DumbCoder was correct, but in circumstances where fraudulent activity would mean otherwise, the FSCS was willing to intervene on the behalf of investors." }, { "docid": "198468", "title": "", "text": "One option might be to use tax certificates to save this money. At the moment they don't pay any interest (unless you deposit more than £100,000 at once), so they aren't very attractive from that point of view. But they do give you a clean way to segregate your money and for the purposes of charging penalty interest, HMRC will treat you as having made the payment at the time you purchased the certificate, if it turns out that you should have paid the actual tax earlier than you did. Another option is a regular saver account. These typically have limits of £250 per month, so you might have to open a few given the amount you have to save. That would add up to a lot of maintenance effort, particularly as you'd have to open new accounts again each year. However, they do typically offer good interest rates compared to what's available elsewhere, and the way they operate fits well with your needs (money coming in regularly and then going out all at once)." }, { "docid": "307845", "title": "", "text": "So here's the way I rationalized my subscription to games pass...I probably only buy like 4-5ish new games each year, and I get my money's worth from those. I find that there are times during the year when I do have time to game but I don't because I don't have anything I want to play. As long as I can find at least one different game to spend a week(end) or longer playing in a given month, I think I'll continue to pay the $10/month." }, { "docid": "294560", "title": "", "text": "One super-profligate man generates several orders of magnitude less economic activity than if 100,000 families had, say $100,000 each; less than he managed to spend. 100,000 families with that much more money would all be able to eat at restaurants, buy clothes (I don't care how big his, his wives, and his 18 kids closets are; we're talking something like a thousand orders of magnitude here) buy cars, and just generally create a thousand orders of extra economic activity here; their economic activity of buying would give further jobs to the sellers of all this stuff; which would in turn be able to buy stuff, and an economy recovers. *edit spelling, grammar" }, { "docid": "434799", "title": "", "text": "\"I'm trying to understand how an ETF manager optimized it's own revenue. Here's an example that I'm trying to figure out. ETF firm has an agreement with GS for blocks of IBM. They have agreed on daily VWAP + 1% for execution price. Further, there is a commission schedule for 5 mils with GS. Come month end, ETF firm has to do a monthly rebalance. As such must buy 100,000 shares at IBM which goes for about $100 The commission for the trade is 100,000 * 5 mils = $500 in commission for that trade. I assume all of this is covered in the expense ratio. Such that if VWAP for the day was 100, then each share got executed to the ETF at 101 (VWAP+ %1) + .0005 (5 mils per share) = for a resultant 101.0005 cost basis The ETF then turns around and takes out (let's say) 1% as the expense ratio ($1.01005 per share) I think everything so far is pretty straight forward. Let me know if I missed something to this point. Now, this is what I'm trying to get my head around. ETF firm has a revenue sharing agreement as well as other \"\"relations\"\" with GS. One of which is 50% back on commissions as soft dollars. On top of that GS has a program where if you do a set amount of \"\"VWAP +\"\" trades you are eligible for their corporate well-being programs and other \"\"sponsorship\"\" of ETF's interests including helping to pay for marketing, rent, computers, etc. Does that happen? Do these disclosures exist somewhere?\"" }, { "docid": "244233", "title": "", "text": "The only ridiculous thing in the article is the statement that taxes to try to keep down inequality won't do any good because companies will hire less. What bullshit. Taxes on the wealthy doesn't need to come from the companies alone, it should also come from closing ridiculous loopholes that only favour the rich, and a more progressive income tax system that includes all earnings, be them through wages or through capital gains. I really don't understand why $100,000 in wages should be treated differently tax-wise than $100,000 in capital gains..." }, { "docid": "241599", "title": "", "text": "\"For the most part, saving money usually depends upon having a budget and being able to stick to it. The toughest part of budgeting is usually setting it up (how much do I need for X) and sticking to it each month. In regards to sticking to it, there is software that you can use that helps figure out how much you are spending and how much you have left in a given category and they all pretty much do the same thing: track your spending and how much you have left in the category. If you are good with spreadsheets you might prefer that route (cost: free) but software that you can buy usually has value in that it can also generate reports that help you spot trends that you might not see in the spreadsheet. Sticking to a budget can be tough and a lot of what people have said already is good advice, but one thing that helps for me is having \"\"play money\"\" that can be used for whatever I want. In general this should be a fairly nominal amount ($20 or $40 a week) but it is enough that if you see a new book you want or what to go out for lunch one day you can do it without impacting the overall budget in some way. Likewise, having bigger savings goals can also be useful in that if times get tough it is easier to stop putting $100 a month to the side for a vacation than it is to cut back your grocery budget.\"" }, { "docid": "401792", "title": "", "text": "Why? Because when I play a game, I use every rule to my advantage. It sounds like that's what he's doing. He's also created thousands of jobs that otherwise wouldn't exist. I admire people with the inclination and skills to be a shrewd businessman. I don't know the guy personally, or much of anything about him. I'm mostly defending the practice of playing the game to win, and having the skills to do so." }, { "docid": "495977", "title": "", "text": "\"As others have pointed out, it's all about a fixed, small cost versus the potential of a large cost. If you have insurance, you know you will pay a fixed amount per month. There is a 100% probability that you will have to pay this premium. If you don't have insurance, there is a large chance that you will have no cost in any given month, and a small chance that you will have a large cost. Like my home-owners insurance costs me about $50 per month. If I didn't have insurance and my house burned down, I would be out something like $100,000. What's the chance that my house will burn down this month? Very small. But I'd rather pay $50 and not have to worry about it. On the other hand, I just bought a filing cabinet for $160 and the store offered me an \"\"extended warranty\"\" for something like $20 a year. What's the probability that some accident will happen that damages my filing cabinet? Pretty small. Even if it did, I think I could handle shelling out $160. I can imagine my stomach in knots and lying awake at nights worrying about the possibility of losing $100,000 or finding myself homeless. I can't imagine lying awake at nights worrying about losing $160 or being force to stuff my files under the bed. I'll take my chances. When I was young and had even less money than I have now, I bought cars that cost me a thousand dollars or. Even poor as I was, I knew that if the car was totaled I could dig up the cash to buy another. It wasn't worth paying the insurance premium. These days I'm driving a car that cost me $6,000. I have collision and comprehensive insurance, but I think it's debatable. I bought the car with cash to begin with, and if I had to I could scrape up the cash to replace it. Especially considering that my last payment for my daughter's college tuition is due next month and then that expense is gone. :-)\"" }, { "docid": "408918", "title": "", "text": "\"Largely, because stock markets are efficient markets, at least mostly if not entirely; while the efficient market hypothesis is not necessarily 100% correct, for the majority of traders it's unlikely that you could (on the long term) find significant market inefficiencies with the tools available to an individual of normal wealth (say, < $500k). That's what frequent trading intends to do: find market inefficiencies. If the market is efficient, then a stock is priced exactly at what it should be worth, based on risk and future returns. If it is inefficient, then you can make more money trading on that inefficiency versus simply holding it long. But in stating that a stock is inefficient, you are stating that you know something the rest of the market doesn't - or some condition is different for you than the other million or so people in the market. That's including a lot of folks who do this for a living, and have very expensive modelling software (and hardware to run it on). I like to think that I'm smarter than the far majority of people, but I'm probably not the smartest guy in the room, and I certainly don't have that kind of equipment - especially with high frequency trading nowadays. As such, it's certainly possible to make a bit of money as a trader versus as a long-term investor, but on the whole it's similar to playing poker for a living. If you're smarter than most of the people in the room, you might be able to make a bit of money, but the overhead - in the case of poker, the money the house charges for the game, in the case of stocks, the exchange fees and broker commissions - means that it's a losing game for the group as a whole, and not very many people can actually make money. Add to that the computer-based trading - so imagine a poker game where four of the eight players are computer models that are really good (and actively maintained by very smart traders) and you can see where it gets to be very difficult to trade at a profit (versus long term investments, which take advantage of the growth in value in the company). Finally, the risk because of leverage and option trading (which is necessary to really take advantage of inefficiencies) makes it not only hard to make a profit, but easy to lose everything. Again to the poker analogy, the guys I've known playing poker for a living do it by playing 10-20 games at once - because one game isn't efficient enough, you wouldn't make enough money. In poker, you can do that fairly safely, especially in limit games; but in the market, if you're leveraging your money you risk losing a lot. Every action you take to make it \"\"safer\"\" removes some of your profit.\"" }, { "docid": "504089", "title": "", "text": "-I understand. If the option expires and you paid a premium of let's say $20, then you loose it. I will still have to read more obviously. If there are other ways to play the commodities market in a safer way, I am more than willing to look into it. -I understand futures and options on futures are more risky than stocks. What I am getting at is it is less risky COMPARED to regular futures. Compared to the available choices, this seems like the safest. I understand I can loose all the money I invest/speculate with. But loosing $10 (or whatever the price of said commodity options are), is still better than loosing thousands. I agree though I should do my do diligence. -What I am getting at is obviously certain things are correlated with bull or bear markets (gold bear, growth stocks bull). If you can use a combination of assets, you can have some that are winners, while some will be down. I don't expect one asset to be a super asset. -But most the stocks are overvalued, and are overrated. I have found several stocks that I am invested in (MGM Macau, Lippo Mall, and Whiting Trust II). I am also in gold, silver, small Riyal position, and Norwegian Kroner." }, { "docid": "279865", "title": "", "text": "So like any market, the housing market will *on average* trend upward. But the extreme prices we're seeing in Toronto or San Francisco are not part of the normal market growth. There's a lot of factors that can affect housing outside of just increased demand. Here's a few of the big ones. 1) Low-Interest Rates: Since (2008? I think) interests rates have been really low, meaning mortgages are really low. If you can borrow money at 4% and the inflation rate is 8%, you've borrowed expensive dollars and are paying back in cheap dollars. 2)NIMBY (Not in my back yard): If you have enough land to build 10 houses or one 100 apartment building, what do you build? Theoretically the apartment building, but in reality, the people that already paid for their million dollar house, don't want a giant apartment complex bringing down the value of the neighborhood and ruining their views. So they pass laws preventing new and bigger buildings, meaning higher prices for the homes that already exist. And as a bonus, it's easier on the city to have 10 people who make a million dollars a year than a 100 people who make 100,000 a year. Foreign investment: So there's a lot of places where people have money, but because of corruption or shaky economies, it's not safe to hold it there. So you buy properties in the U.S. or Canada because you know no one's going to seize it and it's (generally) not going to lose value. So you end up with foreign dollars competing with the local markets for housing, driving the price up." }, { "docid": "427727", "title": "", "text": "I've given up on trying to understand how the allowances correspond to my number of dependents. What I do instead to achieve the same end goal of having the right amount of money withheld is using a paycheck calculator. If I get paid 24 times a year (twice a month) and I figure I'm going to owe about $6,000 of taxes, then every paycheck needs to have $250 of federal tax withheld from it to make sure I am covered. Go to the paycheck calculator and play with the allowance numbers until you get $250 as the federal tax withheld and then submit a new W4 to your employer. This is the only reliable way I've found to figure this out on my own. Because my calculations are done in dollars instead of exemptions, etc. and my taxes do not wildly fluctuate year-to-year this works well for me." }, { "docid": "588153", "title": "", "text": "A derivative is a financial instrument of a special kind, the kind “whose price depends on, or is derived from, another asset”. This definition is from John Hull, Options, Futures and Other Derivatives – a book definitely worth to own if you are curious about this, you can easily find old copies for a few dollars. The first point is that a derivative is a financial instrument, like credits, or insurances, the second point is that its price depends closely from the price of something else, the mentioned asset. In most cases derivatives can be understood as financial insurances against some risk bound to the asset. In the sequel I give a small list of derivatives and highlight the assets and the risk they can be bound to. And first, let me point out that the definition is (marginally) wrong because some derivatives depend on things which are not assets, nor do they have a price, like temperature, sunlight, or even your own life in the case of mortgages. But before going in this list, let me go through the remaining points of your question. What is the basic idea and concept behind a derivative? As already noted, in most cases, a derivative can be understood as a financial insurance compensating from a risk of some sort. In a classical insurance contract, one party of the contract is an insurance company, but in the broader case of a derivative, that counterparty can be pretty anything: an insurance, a bank, a government, a large company, and most probably market makers. How is it really used, and how does this deviate from the first point? Briefly, how does is it affecting people, and how is it causing problems? An important point with derivatives is that it can be arbitrarily complicated to compute their prices. Actually what is hidden in the attempt of giving a definition for derivatives, is that they are products whose price Y is a measurable function of one or several random variables X_1, X_2, … X_n on which we can use the theory of arbitrage pricing to get hints on the actual price Y of the asset – this is what the depends on means in technical terms. In the most favorable case, we obtain an easy formula linking Y to the X_is which tells us what is the price of our financial instrument. But in practice, it can be very difficult, if at all possible, to determine a price for derivatives. This has two implications: Persons possessing sophisticated techniques to compute the price of derivatives have a strategic advantage on derivatives market, in comparison to less advanced actors on the market. Organisation owning assets they cannot price cannot compute their bilan anymore, so that they cannot know for sure their financial situation. They are somehow playing roulette. But wait, if derivatives are insurances they should help to mitigate some financial risk, which precisely means that they should help their owners to more accurately see their financial situation! How is this not a contradiction? Some persons with sophisticated techniques to compute the price of derivatives are actually selling complicated derivatives to less knowledgeable persons. For instance, many communes in France and Germany have contracted credits whose reimbursements have a fixed interest part, like in a classical credit, and a variable interest part whose rate is computed against a complicated formula involving the value of the Swiss frank at each quarter starting from the inception of the credit. (So, for a 25 years running credit of theis type, the price Y of the credit at its inception depends on 100 Xs, which are the uncertain prices for the Swiss frank each quarter of the 25 next years.) Some of these communes can be quite small, with 5.000 inhabitants, and needless to say, do not have the required expertise to analyse the risks bound to such instruments, which in that special case led the court call the credit a swindling and to cancel the credit. But what chain of events leads a 5.000 inhabitants city in France to own a credit whose reimbursements depends on the Swiss frank? After the credit crunch in 2007 and the fall of Lehman Brothers in 2008, it has begun to be very hard to organise funding, which basically means to conclude credits running long in time on large amounts of money. So, the municipality needs a 25 years credit of 10.000.000 EUROS and goes to its communal bank. The communal bank has hundreds or thousands of municipalities looking for credits and needs itself a financing. So the communal bank goes to one of the five largest financial institutions in the world, which insists on selling a huge credit whose reimbursements have a variable part depending on hundred of values the Swiss frank will have in the 25 next years. Since the the big bank has better computation techniques than the small bank it makes a big profit. Since the small bank has no idea, how to compute the correct price of the credit it bought, it cuts this in pieces and sell it in the same form to the various communes it works with. If we were to attribute this kind of intentions to the largest five banks, we could ask about the possibility that they designed the credit to take advantage of the primitive evaluation methods of the small bank. We could also ask if they organised a cartel to force communal banks to buy their bermudean snowballs. And we could also ask, if they are so influent that they eventually can manipulate the Swiss frank to secure an even higher profit. But I will not go into this. To the best of my understanding, the subprime crisis is a play along the same plot, with different actors, but I know this latter subject only by what I could read in French newspapers. So much for the “How is it causing problems?” part. What is some of the terminology in relation to derivatives (and there meanings of course)? Answering this question is basically the purpose of the 7 first chapters of the book by Hull, along with deriving some important mathematical principles. And I will not copy these seven chapters here! How would someone get started dealing in derivatives (I'm playing a realistic stock market simulation, so it doesn't matter if your answer to this costs me money)? If you ask the question, I understand that you are not a professional, so that your are actually trying to become the one that has money and zero knowledge in the play I outlined above. I would recommand not doing this. That said, if you have a good mathematical background and can program well, once you are confindent with the books of Hull and Joshi, you can have fun implementing various market models and implementing trading strategies. Once you are confident with this, you can also read the articles on quantitative finance on arXiv.org. And once you are done with this, you can decide for yourself if you want to play the same market as the guys writing these articles. (And yes, even for the simplest options, they have better models than you have and will systematically outperform you in the long run, even if some random successes will give you the feeling that you do well and could do better.) (indeed, I've made it a personal goal to somehow lose every last cent of my money) You know your weapons! :) Two parties agree today on a price for one to deliver a commodity to the other at some future instant. This is a classical future contract, it can be modified in every imaginable way, usually by embedding options. For instance one party could have the option to choose between different delivery points or delivery days. Two parties write today a contract allowing the one party to buy at some future time a commodity to the the second party. The price is written today, as part of the contract. (There is the corresponding option entitling the owner to sell something.) Unlike the future contract, only one party can be obliged to do something, the other jas a right but no obligation. If you buy and option, your are buying some sort of insurance against a change of price on some asset. This is the most familiar to anybody. Credits can come in many different flavours, especially the formula to compute interests, or also embed options. Common options are early settlement options or restructuration options. While this is not completely inutitive, the credit works like an insurance. This is most easily understood from the side of the organisation lending the money, that speculates that the ratio of creanciers going bankrupt will be low enough for her to make profit, just like a fire insurance company speculates that the ratio of fire accidents will be low enough for her to make a profit. This is like a mortgage on a financial institution. Two parties agree that one will recive an upfront today and give a compensation to the second one if some third party defaults. Here this is an explicit insurance against the unfortuante event, where a creancier goes bankrupt. One finds here more or less standard options on electricity. But electricity have delicious particularities as it can practically not be stored, and fallout is also (usually) avoided. As for classical options, these are insurances against price moves. A swap is like two complementary credits on the same amount of money, so that it ends up in the two parties not actually exchanging the credit nominal and only paying interest one to the other — which makes only sense if these interests are computed with different formulas. Typical example are fixed rate vs. EURIBOR on some given maturity, which we interpret as an insurance against fluctuations of the EURIBOR, or a fixed rate vs. the exchange ratio between two currencies, which we interpret as an insurance against the two currencies decorrelating. Swaps are the richest and the most generic category of financial derivatives. The off-the-counter market features very imaginative, very customised insurance products. The most basic form is the insurance against drought, but you can image different dangers, and once you have it you can put it in options, in a swap, etc. For instance, a restaurant with a terrasse could enter in a weather insurance, paying each year a fixed amount of money and becoming in return an amount of money based on the amount of rainy day in a year. Actually, this list is virtually without limits!" }, { "docid": "576632", "title": "", "text": "\"If I really understood it, you bet that a quote/currency/stock market/anything will rise or fall within a period of time. So, what is the relationship with trading ? I see no trading at all since I don't buy or sell quotes. You are not betting as in \"\"betting on the outcome of an horse race\"\" where the money of the participants is redistributed to the winners of the bet. You are betting on the price movement of a security. To do that you have to buy/sell the option that will give you the profit or the loss. In your case, you would be buying or selling an option, which is a financial contract. That's trading. Then, since anyone should have the same technic (call when a currency rises and put when it falls)[...] How can you know what will be the future rate of exchange of currencies? It's not because the price went up for the last minutes/hours/days/months/years that it will continue like that. Because of that everyone won't have the same strategy. Also, not everyone is using currencies to speculate, there are firms with real needs that affect the market too, like importers and exporters, they will use financial products to protect themselves from Forex rates, not to make profits from them. [...] how the brokers (websites) can make money ? The broker (or bank) will either: I'm really afraid to bet because I think that they can bankrupt at any time! Are my fears correct ? There is always a probability that a company can go bankrupt. But that's can be very low probability. Brokers are usually not taking risks and are just being intermediaries in financial transactions (but sometime their computer systems have troubles.....), thanks to that, they are not likely to go bankrupt you after you buy your option. Also, they are regulated to insure that they are solid. Last thing, if you fear losing money, don't trade. If you do trade, only play with money you can afford to lose as you are likely to lose some (maybe all) money in the process.\"" }, { "docid": "30352", "title": "", "text": "I like precious metals and real estate. For the OP's stated timeframe and the effects QE is having on precious metals, physical silver is not a recommended short term play. If you believe that silver prices will fall as QE is reduced, you may want to consider an ETF that shorts silver. As for real estate, there are a number of ways to generate profit within your time frame. These include: Purchase a rental property. If you can find something in the $120,000 range you can take a 20% mortgage, then refinance in 3 - 7 years and pull out the equity. If you truly do not need the cash to purchase your dream home, look for a rental property that pays all the bills plus a little bit for you and arrange a mortgage of 80%. Let your money earn money. When you are ready you can either keep the property as-is and let it generate income for you, or sell and put more than $100,000 into your dream home. Visit your local mortgage broker and ask if he does third-party or private lending. Ask about the process and if you feel comfortable with him, let him know you'd like to be a lender. He will then find deals and present them to you. You decide if you want to participate or not. Private lenders are sometimes used for bridge financing and the loan amortizations can be short (6 months - 5 years) and the rates can be significantly higher than regular bank mortgages. The caveat is that as a second-position mortgage, if the borrower goes bankrupt, you're not likely to get your principal back." } ]

[ { "docid": "159156", "title": "", "text": "\"For any sort of investment you need to understand your risks first. If you're going to put money into the stock or bond market I would get a hold of Graham's \"\"The Intelligent Investor\"\" first, or any other solid value investing book, and educate yourself on what the risks are. I can't speak about real estate investing but I am sure there are plenty of books describing risks and benefits of that as well. I could see inflation/deflation having an effect there but I think the biggest impact on the landlord front is quality of life in the area you are renting and the quality of the tenant you can get. One crazy tenant and you will be driven mad yourself. As for starting a business, one thing I would like to say is that money does not automatically make money. The business should be driven by a product or service that you can provide first, and the backing seed capital second. In my opinion you will have to put energy and time worth much more than the 100k into a business over time to make it successful so the availability of capital should not be the driving decision here. Hope this helps more than it confuses.\"" } ]

[ { "docid": "244233", "title": "", "text": "The only ridiculous thing in the article is the statement that taxes to try to keep down inequality won't do any good because companies will hire less. What bullshit. Taxes on the wealthy doesn't need to come from the companies alone, it should also come from closing ridiculous loopholes that only favour the rich, and a more progressive income tax system that includes all earnings, be them through wages or through capital gains. I really don't understand why $100,000 in wages should be treated differently tax-wise than $100,000 in capital gains..." }, { "docid": "576632", "title": "", "text": "\"If I really understood it, you bet that a quote/currency/stock market/anything will rise or fall within a period of time. So, what is the relationship with trading ? I see no trading at all since I don't buy or sell quotes. You are not betting as in \"\"betting on the outcome of an horse race\"\" where the money of the participants is redistributed to the winners of the bet. You are betting on the price movement of a security. To do that you have to buy/sell the option that will give you the profit or the loss. In your case, you would be buying or selling an option, which is a financial contract. That's trading. Then, since anyone should have the same technic (call when a currency rises and put when it falls)[...] How can you know what will be the future rate of exchange of currencies? It's not because the price went up for the last minutes/hours/days/months/years that it will continue like that. Because of that everyone won't have the same strategy. Also, not everyone is using currencies to speculate, there are firms with real needs that affect the market too, like importers and exporters, they will use financial products to protect themselves from Forex rates, not to make profits from them. [...] how the brokers (websites) can make money ? The broker (or bank) will either: I'm really afraid to bet because I think that they can bankrupt at any time! Are my fears correct ? There is always a probability that a company can go bankrupt. But that's can be very low probability. Brokers are usually not taking risks and are just being intermediaries in financial transactions (but sometime their computer systems have troubles.....), thanks to that, they are not likely to go bankrupt you after you buy your option. Also, they are regulated to insure that they are solid. Last thing, if you fear losing money, don't trade. If you do trade, only play with money you can afford to lose as you are likely to lose some (maybe all) money in the process.\"" }, { "docid": "546548", "title": "", "text": "\"From The Coca-Cola Company website, section for Investors: Stock History, Issues Year 1919 Original issue -- 600,000 shares 100,000 preferred, par $100 each 500,000 common, without nominal or par value 1926 Eliminated 100,000 preferred in November. This means there were preferred shares issued in 1919. However, all preferred shares were \"\"eliminated\"\" (not sure what that means) as of 1926. There has been no subsequent reissuance of preferred shares of Coca-Cola since then. I think the company is still authorized to issue them, should they choose to do so in the future.\"" }, { "docid": "67320", "title": "", "text": "\"It may be margin loans or credit lines given to brokerages. I have no idea what a loan book is though so don't I don't really know. Also no one \"\"plays\"\" in equity markets with borrowed money unless they know for sure what they are doing or they have collateral as in the case of margin.\"" }, { "docid": "504089", "title": "", "text": "-I understand. If the option expires and you paid a premium of let's say $20, then you loose it. I will still have to read more obviously. If there are other ways to play the commodities market in a safer way, I am more than willing to look into it. -I understand futures and options on futures are more risky than stocks. What I am getting at is it is less risky COMPARED to regular futures. Compared to the available choices, this seems like the safest. I understand I can loose all the money I invest/speculate with. But loosing $10 (or whatever the price of said commodity options are), is still better than loosing thousands. I agree though I should do my do diligence. -What I am getting at is obviously certain things are correlated with bull or bear markets (gold bear, growth stocks bull). If you can use a combination of assets, you can have some that are winners, while some will be down. I don't expect one asset to be a super asset. -But most the stocks are overvalued, and are overrated. I have found several stocks that I am invested in (MGM Macau, Lippo Mall, and Whiting Trust II). I am also in gold, silver, small Riyal position, and Norwegian Kroner." }, { "docid": "422070", "title": "", "text": "Don't feel bad. The last time I did this was 2008. It was an inter-office competition. We started a 6 month run around July. $100,000 each. Same rules as this game only longer. Well this thing happening around September/October in 2008 that caused all hell to break lose on the markets, you might have heard about it. The winner at the end only lost $20,000. I had lost $60,000. We had one guy who only had around $10,000 LEFT. Playing this game while the whole market imploded really drove home how royally FUCKED a lot of people were. Made for a tangible experience of all the junk you saw on the news." }, { "docid": "35680", "title": "", "text": "Yes, you should be saving for retirement. There are a million ideas out there on how much is a reasonable amount, but I think most advisor would say at least 6 to 10% of your income, which in your case is around $15,000 per year. You give amounts in dollars. Are you in the U.S.? If so, there are at least two very good reasons to put money into a 401k or IRA rather than ordinary savings or investments: (a) Often your employer will make matching contributions. 50% up to 6% of your salary is pretty common, i.e. if you put in 6% they put in 3%. If either of your employers has such a plan, that's an instant 50% profit on your investment. (b) Any profits on money invested in an IRA or 401k are tax free. (Effectively, the mechanics differ depending on the type of account.) So if you put $100,000 into an IRA today and left it there until you retire 30 years later, it would likely earn something like $600,000 over that time (assuming 7% per year growth). So you'd pay takes on your initial $100,000 but none on the $600,000. With your income you are likely in a high tax bracket, that would make a huge difference. If you're saying that you just can't find a way to put money away for retirement, may I suggest that you cut back on your spending. I understand that the average American family makes about $45,000 per year and somehow manages to live on that. If you were to put 10% of your income toward retirement, then you would be living on the remaining $171,000, which is still almost 4 times what the average family has. Yeah, I make more than $45,000 a year too and there are times when I think, How could anyone possibly live on that? But then I think about what I spend my money on. Did I really need to buy two new computer printers the last couple of months? I certainly could do my own cleaning rather than hiring a cleaning lady to come in twice a month. Etc. A tough decision to make can be paying off debt versus putting money into an investment account. If the likely return on investment is less than the interest rate on the loan, you should certainly concentrate on paying off the loan. But if the reverse is true, then you need to decide between likely returns and risk." }, { "docid": "294560", "title": "", "text": "One super-profligate man generates several orders of magnitude less economic activity than if 100,000 families had, say $100,000 each; less than he managed to spend. 100,000 families with that much more money would all be able to eat at restaurants, buy clothes (I don't care how big his, his wives, and his 18 kids closets are; we're talking something like a thousand orders of magnitude here) buy cars, and just generally create a thousand orders of extra economic activity here; their economic activity of buying would give further jobs to the sellers of all this stuff; which would in turn be able to buy stuff, and an economy recovers. *edit spelling, grammar" }, { "docid": "418951", "title": "", "text": "\"The $100,000 is taxed separately as \"\"ordinary income\"\". The $350,000 is taxed at long-term capital gains of 15%. Capital gains is not taxed at 20% until $415,050. Even though $100,000 + 350,000 = $450,000, only $350,000 can be taxed at capital gains. The total ordinary income tax burden will be $31,986 if single, in California. Caveat: By creating a holdings corporation (C-corp), you can section 351 that $100,000 into the C-corp for tax deferment, which won't be taxed until you take money from the corporation. Since you will hold 100% of the voting stock, all distributions will be considered pro rata. Additionally, you can issue yourself a dividend under the rules of 26 USC §§243-246 (a greather-than-80% shareholder who receives a dividend can write-off 100% of said dividend). As long as that dividend doesn't trigger §§1.243-246 of The Regulations by keeping the distribution just under 10% of E&P i.e. $10,000. Wages are deductible against basis so pay yourself $35,000 and keep $55,000 in the corporation and you can decrease the total liabilities down to $22,000 from $31,000, which includes the CA franchise tax. You don't have to pay yourself any money out a corporation to use the money.\"" }, { "docid": "514375", "title": "", "text": "\"Yes, the price of a stock is what investors think the value of a stock is, which is not tied to profits or dividends by any rigid formula. But to say that therefore the price could be high even though the company is doing very poorly is hypothetically true, but unlikely in practice. Consider any other product. There is no fixed formula for the value of a used car, either. If everyone agreed that a rusting, 20-year old car that doesn't run is worth $100,000, then that's what it would sell for. But that's a pretty big \"\"if\"\" at the beginning of that sentence. If the car had been used in some hit TV show 20 years ago, or if it was owned by a celebrity, or some such special case, maybe a rusting old car really would sell for $100,000. Likewise, a stock might have a price higher than what one would predict from its dividends if some rich person wanted to buy that company because the brand name brings back nostalgic memories from his youth and so he drives the price up, etc. But the normal case is that, in the long term, the price of a stock tends to settle on a value proportional to the dividends that it pays. Or rather, and this is a big caveat, the dividends that investors expect it to pay in the future. And then adjusted for all sorts of other factors and special situations, like the value of the company if it was to be liquidated, etc.\"" }, { "docid": "585494", "title": "", "text": "\"Pay off the credit cards. From now on, pay off the credit cards monthly. Under no circumstances should you borrow money. You have net worth but no external income. Borrowing is useless to you. $200,000 in two bank accounts, because if one bank collapses, you want to have a spare while you wait for the government to pay off the guarantee. Keep $50,000 in checking and another $50k in savings. The remainder put into CDs. Don't expect interest income beyond inflation. Real interest rates (after inflation) are often slightly negative. People ask why you might keep money in the bank rather than stocks/bonds. The problem is that stocks/bonds don't always maintain their value, much less go up. The bank money won't gain, but it won't suddenly lose half its value either. It can easily take five years after a stock market crash for the market to recover. You don't want to be withdrawing from losses. Some people have suggested more bonds and fewer stocks. But putting some of the money in the bank is better than bonds. Bonds sometimes lose money, like stocks. Instead, park some of the money in the bank and pick a more aggressive stock/bond mixture. That way you're never desperate for money, and you can survive market dips. And the stock/bond part of the investment will return more at 70/30 than 60/40. $700,000 in stock mutual funds. $300,000 in bond mutual funds. Look for broad indexes rather than high returns. You need this to grow by the inflation rate just to keep even. That's $20,000 to $30,000 a year. Keep the balance between 70/30 and 75/25. You can move half the excess beyond inflation to your bank accounts. That's the money you have to spend each year. Don't withdraw money if you aren't keeping up with inflation. Don't try to time the market. Much better informed people with better resources will be trying to do that and failing. Play the odds instead. Keep to a consistent strategy and let the market come back to you. If you chase it, you are likely to lose money. If you don't spend money this year, you can save it for next year. Anything beyond $200,000 in the bank accounts is available for spending. In an emergency you may have to draw down the $200,000. Be careful. It's not as big a cushion as it seems, because you don't have an external income to replace it. I live in southern California but would like to move overseas after establishing stable investments. I am not the type of person that would invest in McDonald's, but would consider other less evil franchises (maybe?). These are contradictory goals, as stated. A franchise (meaning a local business of a national brand) is not a \"\"stable investment\"\". A franchise is something that you actively manage. At minimum, you have to hire someone to run the franchise. And as a general rule, they aren't as turnkey as they promise. How do you pick a good manager? How will you tell if they know how the business works? Particularly if you don't know. How will you tell that they are honest and won't just embezzle your money? Or more honestly, give you too much of the business revenues such that the business is not sustainable? Or spend so much on the business that you can't recover it as revenue? Some have suggested that you meant brand or stock rather than franchise. If so, you can ignore the last few paragraphs. I would be careful about making moral judgments about companies. McDonald's pays its workers too little. Google invades privacy. Exxon is bad for the environment. Chase collects fees from people desperate for money. Tesla relies on government subsidies. Every successful company has some way in which it can be considered \"\"evil\"\". And unsuccessful companies are evil in that they go out of business, leaving workers, customers, and investors (i.e. you!) in the lurch. Regardless, you should invest in broad index funds rather than individual stocks. If college is out of the question, then so should be stock investing. It's at least as much work and needs to be maintained. In terms of living overseas, dip your toe in first. Rent a small place for a few months. Find out how much it costs to live there. Remember to leave money for bigger expenses. You should be able to live on $20,000 or $25,000 a year now. Then you can plan on spending $35,000 a year to do it for real (including odd expenses that don't happen every month). Make sure that you have health insurance arranged. Eventually you may buy a place. If you can find one that you can afford for something like $100,000. Note that $100,000 would be low in California but sufficient even in many places in the US. Think rural, like the South or Midwest. And of course that would be more money in many countries in South America, Africa, or southern Asia. Even southern and eastern Europe might be possible. You might even pay a bit more and rent part of the property. In the US, this would be a duplex or a bed and breakfast. They may use different terms elsewhere. Given your health, do you need a maid/cook? That would lean towards something like a bed and breakfast, where the same person can clean for both you and the guests. Same with cooking, although that might be a second person (or more). Hire a bookkeeper/accountant first, as you'll want help evaluating potential purchases. Keep the business small enough that you can actively monitor it. Part of the problem here is that a million dollars sounds like a lot of money but isn't. You aren't rich. This is about bare minimum for surviving with a middle class lifestyle in the United States and other first world countries. You can't live like a tourist. It's true that many places overseas are cheaper. But many aren't (including much of Europe, Japan, Australia, New Zealand, etc.). And the ones that aren't may surprise you. And you also may find that some of the things that you personally want or need to buy are expensive elsewhere. Dabble first and commit slowly; be sure first. Include rarer things like travel in your expenses. Long term, there will be currency rate worries overseas. If you move permanently, you should certainly move your bank accounts there relatively soon (perhaps keep part of one in the US for emergencies that may bring you back). And move your investments as well. Your return may actually improve, although some of that is likely to be eaten up by inflation. A 10% return in a country with 12% inflation is a negative real return. Try to balance your investments by where your money gets spent. If you are eating imported food, put some of the investment in the place from which you are importing. That way, if exchange rates push your food costs up, they will likely increase your investments at the same time. If you are buying stuff online from US vendors and having it shipped to you, keep some of your investments in the US for the same reason. Make currency fluctuations work with you rather than against you. I don't know what your circumstances are in terms of health. If you can work, you probably should. Given twenty years, your million could grow to enough to live off securely. As is, you would be in trouble with another stock market crash. You'd have to live off the bank account money while you waited for your stocks and bonds to recover.\"" }, { "docid": "9152", "title": "", "text": "\"The key point to answer the question is to consider risk aversion. Assume I suggest a game to you: Throw a coin and if you win, you get $5, if you lose nothing happens. Will you play the game? Of course, you will - you have nothing to lose! What if I suggest this: If you win, you get $10,000,005 and if you lose you must pay $10,000,000 (I also accept cars, houses, spouses, and kidneys as payment). While the expected value of the second game is the same as for the first, if you lose the second game you are more or less doomed to spend the rest of your life in poverty or not even have a rest of your life. Therefore, you will not wish to play the second game. Well, maybe you do - but probably only if you are very, very rich and can easily afford a loss (even if you had $11,000,000 you won't be as happy with a possible raise to $21,000,005 as you'd be unhappy with dropping to a mere $1,000,000, so you'd still not like to play). Some model this by taking logarithms: If your capital grows from $500 to $1000 or from $1000 to $2000, in both cases it doubles, hence is considered the same \"\"personal gain\"\", effectively. And, voíla, the logartithm of your capital grows by the same amount in both cases. This refelcts that a rich man will not be as happy about finding a $10 note as a poor man will be about finding a nickel. The effect of an insurance is that you replace an uncertain event of great damage with a certain event of little damage. Of course, the insurance company plays the same game, with roles swapped - so why do they play? One point is that they play the game very often, which tends to nivel the risks - unless you do something stupid and insure all inhabitants of San Francisco (and nobody else) against eqarthquakes. But also they have enough capital that they can afford to lose the game. In a fair situation, i.e. when the insurance costs just as much as damage cost multiplied with probability of damage, a rational you would eagerly buy the insurance because of risk aversion. Therefore, the insurance will in effect be able to charge more than the statistically fair price and many will still (gnawingly) buy it, and that's how they make a living. The decision how much more one is willing to accept as insurance cost is also a matter of whether you can afford a loss of the insured item easily, with regrets, barely, or not all.\"" }, { "docid": "271076", "title": "", "text": "Any way you look at it, this is a terrible idea. Cars lose value. They are a disposable item that gets used up. The more expensive the car, the more value they lose. If you spend $100,000 on a new car, in four years it will be worth less than $50,000.* That is a lot of money to lose in four years. In addition to the loss of value, you will need to buy insurance, which, for a $100,000 car, is incredible. If your heart is set on this kind of car, you should definitely save up the cash and wait to buy the car. Do not get a loan. Here is why: Your plan has you saving $1,300 a month ($16,000 a year) for 6.5 years before you will be able to buy this car. That is a lot of money for a long range goal. If you faithfully save this money that long, and at the end of the 6.5 years you still want this car, it is your money to spend as you want. You will have had a long time to reconsider your course of action, but you will have sacrificed for a long time, and you will have the money to lose. However, you may find out a year into this process that you are spending too much money saving for this car, and reconsider. If, instead, you take out a loan for this car, then by the time you decide the car was too much of a stretch financially, it will be too late. You will be upside down on the loan, and it will cost you thousands to sell the car. So go ahead and start saving. If you haven't given up before you reach your goal, you may find that in 6.5 years when it is time to write that check, you will look back at the sacrifices you have made and decide that you don't want to simply blow that money on a car. Consider a different goal. If you invest this $1300 a month and achieve 8% growth, you will be a millionaire in 23 years. * You don't need to take my word for it. Look at the car you are interested in, go to kbb.com, select the 2012 version of the car, and look up the private sale value. You'll most likely see a price that is about half of what a new one costs." }, { "docid": "236334", "title": "", "text": "\"I'm going to take a very crude view of this: Suppose that you have an event that would cost $100,000 if it occurred. If there's a 10% chance that it'll happen to you and the insurance costs less than $10,000, you'll make a profit \"\"on average.\"\" This is, of course, assuming that you could afford a $100,000 loss. If you can't, the actual loss could be much higher (or different). For example, if you couldn't afford surgery because you didn't have health insurance, it could be a lot more \"\"costly\"\" in a way that could be difficult to compare to the $100,000. Obviously, this is a very simplistic view of things. For example, making more than you paid on the premium typically isn't the only reason you'd buy insurance (even if you're high net worth). Just wanted to throw this out there for what it's worth though.\"" }, { "docid": "24306", "title": "", "text": "Although I posted this question more than a year ago, I subsequently read information which may be of use as an answer, specifically regarding Pritchard Stockbrokers in the UK several years ago, in which the FSCS stepped in to compensate investors, as detailed in the following: http://www.fscs.org.uk/what-we-cover/questions-and-answers/qas-about-pritchard-stock-6n940n01k/ http://www.ft.com/cms/s/0/89957c56-21e4-11e3-9b55-00144feab7de.html#axzz3crZYbGZ9 For reference, in case the links above are at some point in future taken offline, the FSCS FAQ states: Q: I had “deposited” money with Pritchard so can I expect £85,000 compensation from FSCS? A: No. Pritchard was not a deposit-taker so the money held does not qualify under regulatory rules as a deposit. The money will be treated as an investment, which carries maximum FSCS compensation of £50,000 per person. FSCS has no discretion to pay any more. Q: What happens if my losses are over the FSCS maximum of £50,000 and I accept the FSCS’s compensation? A: If you choose to accept compensation from FSCS, you will be required to assign (or legally transfer) to FSCS all of your rights to claim in the Administration. FSCS will then claim in the Administration standing “in your shoes” and will claim for the whole of your loss, even if it was over £50,000. When FSCS receives the dividends in your place it will then pay to you any amounts recovered to ensure that you do not suffer a disadvantage for having accepted FSCS compensation first. Example 1: Loss = £80,000 FSCS compensation = £50,000 Dividend of 50p/£ received by FSCS = £40,000 FSCS pays £30,000 to claimant so he is fully compensated (total £80,000), and retains £10,000 recovery for itself Example 2: Loss = £100,000 FSCS compensation = £50,000 Dividend of 50p/£ received by FSCS = £50,000 FSCS pays £50,000 to claimant so he is fully compensated (total £100,000), and retains nothing for itself FSCS does not have to have make a full recovery of its £50,000 before it starts paying its dividend recovery on to claimants. Claimants are not compelled to claim from FSCS, or to accept the FSCS offer of compensation. If a person does not want to transfer his legal rights to claim in the Administration to FSCS in return for accepting the payment of compensation, then s/he can decline our compensation and continue his claim in the Administration. After s/he has received the dividend(s), s/he can then return to FSCS to claim for any remaining shortfall. Therefore, the answer provided by @DumbCoder was correct, but in circumstances where fraudulent activity would mean otherwise, the FSCS was willing to intervene on the behalf of investors." }, { "docid": "505461", "title": "", "text": "\"You state \"\"Any info will be appreciated\"\", so here's some background information on my answer (you can skip to my answer): When I worked for banks, I was required to submit suspicious activity to the people above me by filling out a form with a customer's name, SSN, account number(s) and ID. You may hear in media that it is $10K or sometimes $5K. The truth is that it could be lower than that, depending on what the institution defines as suspicious. Every year we were required to take a \"\"course\"\" which implied that terrorists and criminals use cash regularly - whether we agree or disagree is irrelevant - this is what the course implied. It's important to understand that many people use cash-only budgets because it's easier than relying on the banking system which charges overdraft fees for going over, or in some cases, you pay more at merchants because of card usage (some merchants give discounts for cash). If someone has a budget of $10K a month and they choose to use cash, that's perfectly fine. Also, why is it anyone's business what someone does with their private property? This created an interesting contrast among differently aged Americans - older Americans saw the banking system as tyrannical busybodies whereas young Americans didn't care. This is part of why I eventually left the banking system; I felt sick that I had to report this information, but it's amazing how quick everyone is to accept the new rules. Notice how one of the comments asks you what you intend to do with the money, as if it's any of their business. Welcome to the New America©! My answer: If you withdraw $100,000, here is what will more than likely happen: Now, watch the anger at this answer because I'm telling you the truth. This article will explain why. Your very question had a negative 1, as if asking what you're asking is wrong (see the absurdity)! If Joseph Stalin ran for president in the United States, the majority of Americans would welcome him. You have good reason to be concerned; others at this site have noticed this as well.\"" }, { "docid": "358795", "title": "", "text": "\"The loan-to-value ratio (LTV Ratio) is a lending risk assessment ratio that financial institutions and others lenders examine before approving a mortgage. It sounds like your lender has a 60% requirement. Remember the home is the collateral for the loan. If you stop making payments, they can take the house back from you. That number is less than 100% to accommodate changing market prices, the cost of foreclosure, repairing and reselling the home. They may be a safety factor built in depending on the home's location. If you want to buy a $1.8 million dollar home you will have to come up with 40% down payment. That down payment is what reduces the risk for the lender. So no, there is no way to cheat that. Think about the transaction from the view of the lender. Note: in some areas, you can still get a loan if you don't have the required down payment. You just have to pay a monthly mortgage insurance. It's expensive but that works for many home buyers. A separate insurance company offers a policy that helps protect the lender when there isn't enough deposit paid. Update: Er, no. Keep it simple. The bank will only loan you money if it has collateral for the loan. They've built in a hefty safety margin to protect them in case you quit paying them your monthly payments. If you want to spend the money on something else, that would work as long as you provide collateral to protect the lender. You mention borrowing money for some other purpose then buying a home. That would be fine, but you will have to come up with some collateral that protect the lender. If you wanted to buy a new business, the bank would first ask for an appraisal of the value of the assets of the business. That could be applied to the collateral safety net for the lender. If you wanted to buy a business that had little appraisal value, then the bank would require more collateral from you in other forms. Say you wanted to borrow the money for an expensive operation or cosmetic surgery. In that case there is no collateral value in the operation. You can't sell anything from the surgery to anybody to recover costs. The money is spent and gone. Before the bank would loan you any money for such a surgery, they would require you to provide upfront collateral. (in this case if you were to borrow $60,000 for surgery, the bank would require $100,000 worth of collateral to protect their interest in the loan.) You borrow money, then you pay it back at a regular interval at an agreed upon rate and schedule. Same thing for borrowing money for the stock market or a winning horse at the horse race. A lender will require a hard asset as collateral before making you a loan... Yes I know you have a good tip on a winning horse,and you are bound to double your money, but that's not the way it works from a lender's point of view. It sounds like you are trying to game the system by playing on words. I will say quit using the \"\"40% to 60%\"\" phrase. That is just confusing. The bank's loan to value is reported as a single number (in this case 60%) For every $6000 you want to borrow, you have to provide an asset worth $10,000 as a safety guarantee for the loan. If you want to borrow money for the purchase of a home, you will need to meet that 60% safety requirement. If you want to borrow $1,000,000 cash for something besides a home, then you will have to provide something with a retail value of $1,666,667 as equity. I think the best way for you to answer your own question is for you to pretend to be the banker, then examine the proposal from the banker's viewpoint. Will the banker alway have enough collateral for whatever it is you are asking to borrow? If you don't yet have that equity, and you need a loan for something besides a home, you can always save your money until you do have enough equity. Comment One. I thought that most lenders had a 75% or 80% loan to value ratio. The 60% number seems pretty low. That could indicate you may be a high risk borrower, or possibly that lender is not the best for you. Have you tried other lenders? It's definitely worth shopping around for different lenders. Comment Two. I will say, it almost sounds like you aren't being entirely honest with us here. No way someone with a monthly income who can afford a $1.8 Million home would be asking questions like this. I get that English probably isn't your first language, but still. The other thing is: If you are truly buying a $1.8 Million dollar home your real estate agent would be helping you find a lender that will work with you. They would be HIGHLY motivated to see this sale happen. All of your questions could be answered in ten minutes with a visit to your local bank (or any bank for that matter.) When you add up the costs and taxes and insurance on a 30 fixed loan, you'd have a monthly mortgage payment of nearly $10,500 a month or more. Can you really afford that on your monthly income?\"" }, { "docid": "577979", "title": "", "text": "I'm going to echo everyone else's sentiments in this thread. What a ridiculous article! You have a solid, dependable, money making star that runs her own show like a well oiled machine and your biggest critique is that she is a sound business woman? I think there is a special place in journalist hell for writers who try to get attention by only playing contrarian for the sake of being contrarian. News flash, pretty unoriginal. I'm not really a fan of her music but man do I love to see sound business people doing it right. This is worth commending." }, { "docid": "307845", "title": "", "text": "So here's the way I rationalized my subscription to games pass...I probably only buy like 4-5ish new games each year, and I get my money's worth from those. I find that there are times during the year when I do have time to game but I don't because I don't have anything I want to play. As long as I can find at least one different game to spend a week(end) or longer playing in a given month, I think I'll continue to pay the $10/month." } ]

[ { "docid": "101329", "title": "", "text": "You can start a software company. Than your office will be around the world and you can work whenever you want. If you can appoint some people who can collect work from here and there and the coder around the world can give you the job done(this can be done by posting your work in various freelancing site). It is challenging, because you have to get yourself up-to-date with the technological things." } ]

[ { "docid": "30352", "title": "", "text": "I like precious metals and real estate. For the OP's stated timeframe and the effects QE is having on precious metals, physical silver is not a recommended short term play. If you believe that silver prices will fall as QE is reduced, you may want to consider an ETF that shorts silver. As for real estate, there are a number of ways to generate profit within your time frame. These include: Purchase a rental property. If you can find something in the $120,000 range you can take a 20% mortgage, then refinance in 3 - 7 years and pull out the equity. If you truly do not need the cash to purchase your dream home, look for a rental property that pays all the bills plus a little bit for you and arrange a mortgage of 80%. Let your money earn money. When you are ready you can either keep the property as-is and let it generate income for you, or sell and put more than $100,000 into your dream home. Visit your local mortgage broker and ask if he does third-party or private lending. Ask about the process and if you feel comfortable with him, let him know you'd like to be a lender. He will then find deals and present them to you. You decide if you want to participate or not. Private lenders are sometimes used for bridge financing and the loan amortizations can be short (6 months - 5 years) and the rates can be significantly higher than regular bank mortgages. The caveat is that as a second-position mortgage, if the borrower goes bankrupt, you're not likely to get your principal back." }, { "docid": "244233", "title": "", "text": "The only ridiculous thing in the article is the statement that taxes to try to keep down inequality won't do any good because companies will hire less. What bullshit. Taxes on the wealthy doesn't need to come from the companies alone, it should also come from closing ridiculous loopholes that only favour the rich, and a more progressive income tax system that includes all earnings, be them through wages or through capital gains. I really don't understand why $100,000 in wages should be treated differently tax-wise than $100,000 in capital gains..." }, { "docid": "349544", "title": "", "text": "\"Make a list of all your expenses. I use an Excel spreadsheet but you can do it on the back of a napkin if you prefer. List fixed expenses, like rent, loan payments, insurance, etc. I include giving to church and charity as fixed expenses, but of course that's up to you. List regular but not fixed expenses, like food, heat and electricity, gas, etc. Come up with reasonable average or typical values for these. Keep records for at least a few months so you're not just guessing. (Though remember that some will vary with the season: presumably you spend a lot more on heat in the winter than in the summer, etc.) You should budget to put something into savings and retirement. If you're young and just starting out, it's easy to decide to postpone retirement savings. But the sooner you start, the more the money will add up. Even if you can't put away a lot, try to put away SOMETHING. And if you budget for it, you should just get used to not having this money to play with. Then total all this up and compare to your income. If the total is more than your income, you have a problem! You need to find a way to cut some expenses. I won't go any further with that thought -- that's another subject. Hopefully you have some money left over after paying all the regular expenses. That's what you have to play with for entertainment and other non-essentials. Make a schedule for paying your bills. I get paid twice a month, and so I pay most of my bills when I get a paycheck. I have some bills that I allocate to the first check of the month and some to the second, for others, whatever bills came in since my last check, I pay with the current check. I have it arranged so each check is big enough to pay all the bills that come from that check. If you can't do that, if you'll have a surplus from one check and a shortage from the next, then be sure to put money aside from the surplus check to cover the bills you'll pay at the next pay period. Always pay your bills before you spend money on entertainment. Always have a plan to pay your bills. Don't say, \"\"oh, I'll come up with the money somehow\"\". If you have debt -- student loans, car loans, etc -- have a plan to pay it off. One of the most common traps people fall into is saying, \"\"I really need to get out of debt. And I'm going to start paying off my debt. Next month, because this month I really want to buy this way cool toy.\"\" They put off getting out of debt until they have frittered away huge amounts of money on interest. Or worse, they keep accumulating new debt until they can't even pay the interest.\"" }, { "docid": "106310", "title": "", "text": "A lease payment is composed of an interest portion (borrowed money) and depreciation amount (purchase - residual). The Monthly payment is then Monthly Interest Cost + Monthly Depreciation Cost The Money Factor is used to estimate the amount of interest due in a single month of a lease so you can figure out the monthly payment. If you are borrowing $100,000 then over the entire loan of repayment from a balance of $100,000 to a balance of $0, the average amount you owed was $50,000 (1/2 of principal). You are repaying this loan monthly (1/12 of a year) and percents are expressed as decimals (1/100). 6 * 1/2 (for principal) * 1/12 (for monthly) * 1/100 (to convert percentage from 6% to .06) = 6 * 1/2400. 2400 is the product of 3 consecutive conversion (1/2 * 1/12 * 1/100) to convert from an interest rate to a money factor. 6/2400 = Money factor of 0.0025 which can be multiplied against the total amount being borrowed to know what the monthly interest would roughly equal. Some Money Factor info: https://www.alphaleasing.com/resources/articles/MoneyFactor.asp" }, { "docid": "65313", "title": "", "text": "\"Let's face it: most people pay more in insurance premiums than they \"\"get back\"\" in claims. I put \"\"get back\"\" in quotes because, with very few exceptions, the money paid out in claims does not go to the insured, but to others, such as doctors and hospitals. But even if you ignore the question who does the money actually go to, it's a losing proposition for most people. The exceptions are those who have a major loss, greater than what they put in over the years. But never forget: these are exceptions. The return on your money, on the average, is only a little better than playing the lottery. The usual counter-argument to the above is, but what if you are one of the exceptions? I for one refuse to let my life be dictated by worries of unlikely events that might happen. If you're the sort who obsesses on what could (but probably won't) happen, then maybe you should have insurance. Just don't tell me I need to do the same. When I lived in California, they had a program where you could deposit $25,000 with the State, and then you could drive, legally, without insurance. I did this for a while, didn't have any accidents, and exited the system (when I moved out of state) a few years later with more money (interest) than I put in. You don't accomplish that with insurance. But let's get back to rich people. Unless you get into an accident with you at fault and the other guy needing a head transplant as a result (joke), you could probably absorb the cost of an accident without blinking an eye. Those in the upper-middle-class might do well with high-deductible insurance that only pays out if there's an extreme accident. Then again if you have to borrow to buy something expensive (making monthly payments), they will usually demand you buy insurance with it. This is a way for the lender to protect himself at your expense, and if you refuse, good luck getting a loan somewhere else. I hate the idea of insurance so much I would make an act of insurance punishable by law.\"" }, { "docid": "421987", "title": "", "text": "Since then I had gotten a job at a supermarket stocking shelves, but recently got fired because I kept zoning out at work This is not a good sign for day trading, where you spend all day monitoring investments. If you start focusing on the interesting math problem and ignoring your portfolio, you can easily lose money. Not so big a problem for missed buy opportunities, but this could be fatal for missed sale opportunities. Realize that in day trading, if you miss the uptick, you can get caught in a stock that is now going down. And I agree with those who say that you aren't capitalized well enough to get started. You need significantly more capital so that you can buy a diversified portfolio (diversification is your limitation, not hedging). Let's say that you make money on two out of three stocks on average. What are the chances that you will lose money on three stocks in a row? One in twenty-seven. What if that happens on your first three stocks? What if your odds at starting are really one in three to make money? Then you'll lose money more than half the time on each of your first three stocks. The odds don't favor you. If you really think that finance would interest you, consider signing up for an internship at an investment management firm or hedge fund. Rather than being the person who monitors stocks for changes, you would be the person doing mathematical analysis on stock information. Focusing on the math problem over other things is then what you are supposed to be doing. If you are good at that, you should be able to turn that into a permanent job. If not, then go back to school somewhere. You may not like your schooling options, but they may be better than your work options at this time. Note that most internships will be easier to get if you imply that you are only taking a break from schooling. Avoid outright lying, but saying things like needing to find the right fit should work. You may even want to start applying to schools now. Then you can truthfully say that you are involved in the application process. Be open about your interest in the mathematics of finance. Serious math minds can be difficult to find at those firms. Given your finances, it is not practical to become a day trader. If you want proof, pick a stock that is less than $100. Found it? Write down its current price and the date and time. You just bought that stock. Now sell it for a profit. Ignore historical data. Just monitor the current price. Missed the uptick? Too bad. That's reality. Once you've sold it, pick another stock that you can afford. Don't forget to mark your price down for the trading commission. A quick search suggests that $7 a trade is a cheap price. Realize that you make two trades on each stock (buy and sell), so that's $14 that you need to make on every stock. Keep doing that until you've run out of money. Realize that that is what you are proposing to do. If you can make enough money doing that to replace a minimum wage job, then we're all wrong. Borrow a $100 from your mom and go to town. But as others have said, it is far more realistic to do this with a starting stake of $100,000 where you can invest in multiple stocks at once and spread your $7 trading fee over a hundred shares. Starting with $100, you are more likely to run out of money within ten stocks." }, { "docid": "525390", "title": "", "text": "\"A company has 100,000 shares and 100,000 unexercised call options (company issued). Share price and strike price both at $1. What country is this related to? I ask because, in the US, most people I know associate a \"\"call\"\" option with the instrument that is equivalent to 100 shares. So 100,000 calls would be 10,000,000 shares, which exceeds the number of shares you're saying the company has. I don't know if that means you pulled the numbers out of thin air, or whether it means you're thinking of a different type of option? Perhaps you meant incentive stock options meant to be given to employees? Each one of those is equivalent to a single share. They just aren't called \"\"call options\"\". In the rest of my answer, I'm going to assume you meant stock options. I assume the fact that these options exist will slow any price increases on the underlying shares due to potential dilution? I don't think the company can just create stock options without creating the underlying shares in the first place. Said another way, a more likely scenario is that company creates 200,000 shares and agrees to float 50% of them while reserving the other 50% as the pool for incentive employee stock. They then choose to give the employees options on the stock in the incentive pool, rather than outright grants of the stock, for various reasons. (One of which is being nice to the employees in regards to taxes since there is no US tax due at grant time if the strike price is the current price of the underlying stock.) An alternative scenario when the company shares are liquidly traded is that the company simply plans to buy back shares from the market in order to give employees their shares when options are exercised. In this case, the company needs the cash on hand, or cash flow to take money from, to buy those shares at current prices. Anyway, in either case, there is no dilution happening WHEN the options get exercised. Any dilution happened before or at the time the options were created. Meaning, the total number of shares in the company was already pre-set at an earlier time. As a result, the fact that the options exist in themselves will not slow price changes on the stock. However, price changes will be impacted by the total float of shares in the company, or the impact to cash flow if the company has to buy shares to redeem its option commitments. This is almost the same thing you're asking about, but it is technically different as to timing. If this is the case, can this be factored into any option pricing models like black-scholes? You're including the effect just by considering the total float of shares and net profits from cash flow when doing your modelling.\"" }, { "docid": "67320", "title": "", "text": "\"It may be margin loans or credit lines given to brokerages. I have no idea what a loan book is though so don't I don't really know. Also no one \"\"plays\"\" in equity markets with borrowed money unless they know for sure what they are doing or they have collateral as in the case of margin.\"" }, { "docid": "408918", "title": "", "text": "\"Largely, because stock markets are efficient markets, at least mostly if not entirely; while the efficient market hypothesis is not necessarily 100% correct, for the majority of traders it's unlikely that you could (on the long term) find significant market inefficiencies with the tools available to an individual of normal wealth (say, < $500k). That's what frequent trading intends to do: find market inefficiencies. If the market is efficient, then a stock is priced exactly at what it should be worth, based on risk and future returns. If it is inefficient, then you can make more money trading on that inefficiency versus simply holding it long. But in stating that a stock is inefficient, you are stating that you know something the rest of the market doesn't - or some condition is different for you than the other million or so people in the market. That's including a lot of folks who do this for a living, and have very expensive modelling software (and hardware to run it on). I like to think that I'm smarter than the far majority of people, but I'm probably not the smartest guy in the room, and I certainly don't have that kind of equipment - especially with high frequency trading nowadays. As such, it's certainly possible to make a bit of money as a trader versus as a long-term investor, but on the whole it's similar to playing poker for a living. If you're smarter than most of the people in the room, you might be able to make a bit of money, but the overhead - in the case of poker, the money the house charges for the game, in the case of stocks, the exchange fees and broker commissions - means that it's a losing game for the group as a whole, and not very many people can actually make money. Add to that the computer-based trading - so imagine a poker game where four of the eight players are computer models that are really good (and actively maintained by very smart traders) and you can see where it gets to be very difficult to trade at a profit (versus long term investments, which take advantage of the growth in value in the company). Finally, the risk because of leverage and option trading (which is necessary to really take advantage of inefficiencies) makes it not only hard to make a profit, but easy to lose everything. Again to the poker analogy, the guys I've known playing poker for a living do it by playing 10-20 games at once - because one game isn't efficient enough, you wouldn't make enough money. In poker, you can do that fairly safely, especially in limit games; but in the market, if you're leveraging your money you risk losing a lot. Every action you take to make it \"\"safer\"\" removes some of your profit.\"" }, { "docid": "35680", "title": "", "text": "Yes, you should be saving for retirement. There are a million ideas out there on how much is a reasonable amount, but I think most advisor would say at least 6 to 10% of your income, which in your case is around $15,000 per year. You give amounts in dollars. Are you in the U.S.? If so, there are at least two very good reasons to put money into a 401k or IRA rather than ordinary savings or investments: (a) Often your employer will make matching contributions. 50% up to 6% of your salary is pretty common, i.e. if you put in 6% they put in 3%. If either of your employers has such a plan, that's an instant 50% profit on your investment. (b) Any profits on money invested in an IRA or 401k are tax free. (Effectively, the mechanics differ depending on the type of account.) So if you put $100,000 into an IRA today and left it there until you retire 30 years later, it would likely earn something like $600,000 over that time (assuming 7% per year growth). So you'd pay takes on your initial $100,000 but none on the $600,000. With your income you are likely in a high tax bracket, that would make a huge difference. If you're saying that you just can't find a way to put money away for retirement, may I suggest that you cut back on your spending. I understand that the average American family makes about $45,000 per year and somehow manages to live on that. If you were to put 10% of your income toward retirement, then you would be living on the remaining $171,000, which is still almost 4 times what the average family has. Yeah, I make more than $45,000 a year too and there are times when I think, How could anyone possibly live on that? But then I think about what I spend my money on. Did I really need to buy two new computer printers the last couple of months? I certainly could do my own cleaning rather than hiring a cleaning lady to come in twice a month. Etc. A tough decision to make can be paying off debt versus putting money into an investment account. If the likely return on investment is less than the interest rate on the loan, you should certainly concentrate on paying off the loan. But if the reverse is true, then you need to decide between likely returns and risk." }, { "docid": "200946", "title": "", "text": "DO NOT DO NOT DO NOT DO THAT!!! What could happen if you lie is that they ask for pay stubs before you get an offer letter. If you don't have paystubs to back up what you claim to of made you have likely just lost your job. If they keep you anyway they will be watching you like a hawk because you have proven on the front end that you can't be trusted. I just went through this very same thing a few months ago and here is how I handled it. These numbers are made up so not to reveal my real salary, of course. I was making $2/hr and underpaid at my then company and wanted to make $10 from the new guys. I knew they wouldn't pay me $10 so I was hoping to make $6. They also wouldn't pay me $6 put they offered me $5. $5 was $3 more than I was making before so I gladly took it. I have a salary I can live with for a few years and I'm in a position to grow with the new company. Be honest and negotiate. Be prepared to explain why you think you are worth the money you say you are. Be reasonable about the situation and don't get greedy. You are doing good by them showing interest in retaining you in the first place. Play your cards correctly and professionally and you will do well. Whatever you do don't lie about anything. Good luck!!!" }, { "docid": "313158", "title": "", "text": "\"There will be no police involved. The police do not care. Only the feds care, and they only care about large amounts (over $100,000). What will happen is that the teller will deposit the money like nothing is unusual, but the amount will trigger a \"\"Suspicious Transaction Report\"\" to be filed by the bank. This information goes to the US Treasury and is then circulated by the Treasury to basically every agency in the government: the Department of Defense, the FBI, the NSA, the CIA, the DEA, the IRS, etc. What happens next depends on your relationship with your bank and the personality of the bank. In my case I have made large cash transactions at two different banks, one that I had a long relationship with, and another that I had a long-standing but dormant account. The long-term one was a high end savings bank in a city. The dormant one was one of those bozo retail banks (think \"\"Citizens\"\" or \"\"Bank of America\"\") in a suburb. The long-term bank ignored my first deposit, but after I made some more including one over $50,000 in cash they summoned me via a letter. I went in, talked to the branch manager and explained why I was making the deposits. He said \"\"That sounds plausible.\"\" and that was the end of the interview. It is unlikely that they transferred the information. They probably just wrote it down. They did this because they have \"\"know your customer\"\" regulations and they wanted to be able to prove that they did \"\"due diligence\"\" in case anybody asked about it later. The suburban bank never asked any questions, but they did file the STRs. In general, there is no way to know if the bank will interview you or not. It depends on a lot of different factors. The basic factors are: how much money is it, are you doing a lot of business normally, and how well does the bank know you. If you refuse to answer the bank's questions to their satisfaction, it is a 100% chance that they will close your account. They can also file higher level reports that flag your activity as \"\"highly suspicious\"\" as opposed to just the normal \"\"suspicious\"\". As long as it is a bank employee, you should have no serious concerns unless the guy seems strange and asks really pointed questions. If you have any question whether the \"\"employee\"\" is legitimate, just verify that he/she is a bank employee. Obviously if the feds visit you, you should say nothing. The chance of this happening is 1 in a million.\"" }, { "docid": "279865", "title": "", "text": "So like any market, the housing market will *on average* trend upward. But the extreme prices we're seeing in Toronto or San Francisco are not part of the normal market growth. There's a lot of factors that can affect housing outside of just increased demand. Here's a few of the big ones. 1) Low-Interest Rates: Since (2008? I think) interests rates have been really low, meaning mortgages are really low. If you can borrow money at 4% and the inflation rate is 8%, you've borrowed expensive dollars and are paying back in cheap dollars. 2)NIMBY (Not in my back yard): If you have enough land to build 10 houses or one 100 apartment building, what do you build? Theoretically the apartment building, but in reality, the people that already paid for their million dollar house, don't want a giant apartment complex bringing down the value of the neighborhood and ruining their views. So they pass laws preventing new and bigger buildings, meaning higher prices for the homes that already exist. And as a bonus, it's easier on the city to have 10 people who make a million dollars a year than a 100 people who make 100,000 a year. Foreign investment: So there's a lot of places where people have money, but because of corruption or shaky economies, it's not safe to hold it there. So you buy properties in the U.S. or Canada because you know no one's going to seize it and it's (generally) not going to lose value. So you end up with foreign dollars competing with the local markets for housing, driving the price up." }, { "docid": "389025", "title": "", "text": "I don't call myself a daytrader. My ideal timeframe is from a few days to a couple weeks, sometimes even longer. So swings will always be my priority, but I do daytrade futures/forex outside of regular hours and equities when I'm not doing a swing. Platform is really only important when you realize what you need from it. If you're doing plenty of tickets, commissions will play a larger role the more you trade. Some brokers are more bare-bones, some have more technology/tools. If you're just learning, you typically don't want to put on extra expenses, but as you start making money, you'll want to go with a broker that minimizes your costs while using a third party for whatever tools you need." }, { "docid": "471828", "title": "", "text": "Can you even answer a simple question? Economics is not game unless you're thinking playing with people lives is a game? Government saving is giving away money? What? Do you even know what saving means? Also it's not because I don't agree with you that I don't have an open mind. I go with the facts and the facts suggest you're on another planet. Going against the status quo isn't a sign of an open mind." }, { "docid": "147163", "title": "", "text": "Personal finances are not intuitive for everyone, and it can be a challenge to know what to do when you haven't been taught. Congratulations on recognizing that you need to make a change. The first step that I would recommend is what you've already done: Assemble your bank statements so you can get an accurate picture of what money you currently have. Keep organized folders so you can find your bank statements when you need them. In addition to the bank statements for your checking and savings accounts, you also need to assess any debt that you have. Have you taken out any loans that need to be paid back? Do you have any credit card debt? Make a list of all your debts, and make sure that you have folders for these statements as well. Hopefully, you don't have any debts. But if you are like most people, you owe money to someone, and you may even owe more money than you currently have in your bank accounts. If you have debts, fixing this problem will be one of your goals. No matter what your debt is, you need to make sure that from now on, you don't spend more money than you take in as income. To do this, you need to make a budget. A budget is a plan for spending your money. To get started with a budget, make a list of all the income you will receive this month. Add it up, and write that amount at the top of a page. Next, you want to make a list of all the expenses you will have this month. Some of these expenses are more or less fixed: rent, utility bills, etc. Write those down first. Some of the expenses you have more control over, such as food and entertainment. Give yourself some money to spend on each of these. You may also have some larger expenses that will happen in the future, such as a tuition or insurance payment. Allocate some money to those, so that by the time that payment comes around, you will have saved enough to pay for those expenses. If you find that you don't have enough income to cover all of your expenses in a month, you need to either reduce your expenses somewhere or increase your income until your budget is at a point where you have money left over at the end of each month. After you've gotten to this point, the next step is figuring out what to do with that extra money left over. This is where your goals come into play. If you have debt, I recommend that one of your first goals is to eliminate that debt as fast as possible. If you have no money saved, you should make one of your goals saving some money as an emergency fund. See the question Oversimplify it for me: the correct order of investing for some ideas on what order you should place your goals. Doing the budget and tracking all of your spending on paper is possible, but many people find that using the right software to help you do this is much easier. I have written before on choosing budgeting software. All of the budgeting software packages I mentioned in that post are from the U.S., but many of them can successfully be used in Europe. YNAB, the program I use, even has an unofficial German users community that you might find useful. One of the things that budgeting software will help you with is the process of reconciling your bank statements. This is where you go through the bank statement each month and compare it to your own record of spending transactions in your budget. If there are any transactions that appear in the statement that you don't have recorded, you need to figure out why. Either it is an expense that you forgot to record, or it is a charge that you did not make. Record it if it is legitimate, or dispute the expense if it is fraudulent. For more information, look around at some of the questions tagged budget. I also recommend the book The Total Money Makeover by Dave Ramsey, which will provide more help in making a budget and getting out of debt." }, { "docid": "504089", "title": "", "text": "-I understand. If the option expires and you paid a premium of let's say $20, then you loose it. I will still have to read more obviously. If there are other ways to play the commodities market in a safer way, I am more than willing to look into it. -I understand futures and options on futures are more risky than stocks. What I am getting at is it is less risky COMPARED to regular futures. Compared to the available choices, this seems like the safest. I understand I can loose all the money I invest/speculate with. But loosing $10 (or whatever the price of said commodity options are), is still better than loosing thousands. I agree though I should do my do diligence. -What I am getting at is obviously certain things are correlated with bull or bear markets (gold bear, growth stocks bull). If you can use a combination of assets, you can have some that are winners, while some will be down. I don't expect one asset to be a super asset. -But most the stocks are overvalued, and are overrated. I have found several stocks that I am invested in (MGM Macau, Lippo Mall, and Whiting Trust II). I am also in gold, silver, small Riyal position, and Norwegian Kroner." }, { "docid": "509266", "title": "", "text": "I just graduated from college and I am already planning my retirement. ... in terms of money sitting in my bank account post retirement, assuming Ii have $250,000 what is the highest interest that I can earn with it? Assuming you are 22, and will retire in 45 years at age 67. There is no way to predict interest rates. When I was 22 and just out of college I started putting money into a bank account to save for a down payment. The rate for a savings account was 6%. That means that every month I made 1/2 of one percent. Today that same credit union offers a money maker account with a minimum balance of $100,000 that pays 0.25% for the year. What I made in a month would take two years to make today. Keep in mind we also can't estimate your pay in the last year before retirement, or the inflation rate for the next 45 years, or the mortgage rate, or the availability of Social Security, or the returns of the S&P for 45 years. It is great you are starting to think about this today. But you will have to keep adjusting parts of your plan as the years go by: You may have to factor in children, your medical situation... Even if the interest rates recover you may not want to put all your post retirement money in the bank. Most people can't sustain the required flow of money for their 30 years of retirement from savings accounts. As for today. FDIC (or similar accounts from credit unions) will not have rates approaching 3%. It can't even approach that 3% rate via multi-year CDs. My credit union has a 6 year CD for almost 2%. If the goal of the money is safety then don't expect to find those high rates now. Some institutions may offer high rates without that FDIC protection, but that is risky." }, { "docid": "504178", "title": "", "text": "\"As long as there is nothing more to this story you aren't sharing, you can expect those bills you paid to come back (you will have to pay them again later). You can be pretty certain that the name he gave you was fake, and that the bank account you paid your bills with was not his. I would not try to do anything at all with the information he gave you because first it is not his, and second your name is already tied to this bank account via your utility bills. In other words that would be illegal and you are already on the list of suspects. I would say that if you don't call the police they probably won't call you. The police often times do not even waste their time when somebody's light bill was paid with fraudulent financial information or whatever. I have actually seen similar situations play out a number of times and the police have never gotten involved. Disclaimer: I probably don't live where you live, and I'm not an attorney. But I do know what I am talking about so here's my advice (I know you didn't ask for advice but you probably might benefit from it). Let that money go, sometimes people get you. Take it as a lesson and move on. If you do end up having to have contact with the police and you don't already know, they will lie to you and try to trick you into acting in a way that is not in your self interest. But then you kind of look guilty if you won't even talk to them, and in this case you did not do anything illegal. So if I was you I would probably just think of where I might be incriminating myself by telling the truth, if there were any parts of my story that would raise any flags, and think of how I would smooth those out ahead of time. Also for your personal information you do not need to have a sophisticated understanding of computers to do anything you described, if you are familiar with operating a web browser you can do all types of stuff with Paypal. Most people that give off the vibe \"\"criminal\"\" are not going to be able to make any money conning people and would probably have given it up before they got to you. The information you have is not like the most valuable stuff ever but somebody that knew what they were doing could use it to take money out of your account, and if they had that and then could get a few other pieces they could really mess up your life. So that's part of why they say to be careful, any one piece is maybe not so valuable but if you are loose with everything you will probably have a shitty few weeks at some points in the future. \"\"no aa\"\" lol\"" } ]

[ { "docid": "239459", "title": "", "text": "As you have already good on your retirement kitty. Assuming you have a sufficient cash for difficult situations, explore the options of investing in Shares and Mutual Funds. As you are new to Stock Market, begin slowly by investing into Mutual Funds and ETF for precious metals. This will help you understand and give you confidence on markets and returns. Real estate is a good option, the down side being the hassle of getting rental and the illiquid nature of the investment." } ]

[ { "docid": "418951", "title": "", "text": "\"The $100,000 is taxed separately as \"\"ordinary income\"\". The $350,000 is taxed at long-term capital gains of 15%. Capital gains is not taxed at 20% until $415,050. Even though $100,000 + 350,000 = $450,000, only $350,000 can be taxed at capital gains. The total ordinary income tax burden will be $31,986 if single, in California. Caveat: By creating a holdings corporation (C-corp), you can section 351 that $100,000 into the C-corp for tax deferment, which won't be taxed until you take money from the corporation. Since you will hold 100% of the voting stock, all distributions will be considered pro rata. Additionally, you can issue yourself a dividend under the rules of 26 USC §§243-246 (a greather-than-80% shareholder who receives a dividend can write-off 100% of said dividend). As long as that dividend doesn't trigger §§1.243-246 of The Regulations by keeping the distribution just under 10% of E&P i.e. $10,000. Wages are deductible against basis so pay yourself $35,000 and keep $55,000 in the corporation and you can decrease the total liabilities down to $22,000 from $31,000, which includes the CA franchise tax. You don't have to pay yourself any money out a corporation to use the money.\"" }, { "docid": "30352", "title": "", "text": "I like precious metals and real estate. For the OP's stated timeframe and the effects QE is having on precious metals, physical silver is not a recommended short term play. If you believe that silver prices will fall as QE is reduced, you may want to consider an ETF that shorts silver. As for real estate, there are a number of ways to generate profit within your time frame. These include: Purchase a rental property. If you can find something in the $120,000 range you can take a 20% mortgage, then refinance in 3 - 7 years and pull out the equity. If you truly do not need the cash to purchase your dream home, look for a rental property that pays all the bills plus a little bit for you and arrange a mortgage of 80%. Let your money earn money. When you are ready you can either keep the property as-is and let it generate income for you, or sell and put more than $100,000 into your dream home. Visit your local mortgage broker and ask if he does third-party or private lending. Ask about the process and if you feel comfortable with him, let him know you'd like to be a lender. He will then find deals and present them to you. You decide if you want to participate or not. Private lenders are sometimes used for bridge financing and the loan amortizations can be short (6 months - 5 years) and the rates can be significantly higher than regular bank mortgages. The caveat is that as a second-position mortgage, if the borrower goes bankrupt, you're not likely to get your principal back." }, { "docid": "379387", "title": "", "text": "I will use 10% of this 20K to pay the loan back on an annual basis agreement An annual payment of 0.8% ($2,000 / $250,000) is nowhere near large enough. The interest alone is going to be well over $10,000 (and probably closer to $20,000 on an unsecured loan), so you need to plan for at least a $20,000 - $30,000 annual payment, depending on the terms (length and interest rate) on the loan. But in general... is this sustainable/safe? Essentially what you are doing is using leverage to increase the amount you can invest. While this is fantastic when the market rises, it can go horribly wrong when the market goes down. Generally it is unwise to fund a risky (meaning there are large swings in return) investment with a risk-free (meaning you'll always make a payment) loan. If you want to see what could happen, forecast a 20% market drop and see what you are left with (obviously you'll need to make the loan payment out of your balance since you won't have any gains to pull from). An average of 10-12% over a long period of time is reasonable, but the variance can cause the return to be anywhere from -40% to +40% in one year. Can you afford those losses? Here's an actual example: If you were to invest $250,000 in the S&P 500 in January 2000 with an 8% interest-only loan, your next three years' returns would be: After three years, assuming an interest-only payment of $20,000, your balance would be just over $100,000, you'd still owe $250,000, and you'd still be making $20,000 in interest payments. If your loan interest rate was 25% (which is not unreasonable for an unsecured loan), you'd be bankrupt after 3 years - you'd still owe $250K but could not make the interest payment. No, this is not a good idea. The only time you should borrow money to invest in when you have control over the returns. So if you wanted to start your own business, had a stable business plan, and had much more certainty over the returns, the borrowing money might be plausible. But borrowing money to do passive investment is a huge mistake." }, { "docid": "525390", "title": "", "text": "\"A company has 100,000 shares and 100,000 unexercised call options (company issued). Share price and strike price both at $1. What country is this related to? I ask because, in the US, most people I know associate a \"\"call\"\" option with the instrument that is equivalent to 100 shares. So 100,000 calls would be 10,000,000 shares, which exceeds the number of shares you're saying the company has. I don't know if that means you pulled the numbers out of thin air, or whether it means you're thinking of a different type of option? Perhaps you meant incentive stock options meant to be given to employees? Each one of those is equivalent to a single share. They just aren't called \"\"call options\"\". In the rest of my answer, I'm going to assume you meant stock options. I assume the fact that these options exist will slow any price increases on the underlying shares due to potential dilution? I don't think the company can just create stock options without creating the underlying shares in the first place. Said another way, a more likely scenario is that company creates 200,000 shares and agrees to float 50% of them while reserving the other 50% as the pool for incentive employee stock. They then choose to give the employees options on the stock in the incentive pool, rather than outright grants of the stock, for various reasons. (One of which is being nice to the employees in regards to taxes since there is no US tax due at grant time if the strike price is the current price of the underlying stock.) An alternative scenario when the company shares are liquidly traded is that the company simply plans to buy back shares from the market in order to give employees their shares when options are exercised. In this case, the company needs the cash on hand, or cash flow to take money from, to buy those shares at current prices. Anyway, in either case, there is no dilution happening WHEN the options get exercised. Any dilution happened before or at the time the options were created. Meaning, the total number of shares in the company was already pre-set at an earlier time. As a result, the fact that the options exist in themselves will not slow price changes on the stock. However, price changes will be impacted by the total float of shares in the company, or the impact to cash flow if the company has to buy shares to redeem its option commitments. This is almost the same thing you're asking about, but it is technically different as to timing. If this is the case, can this be factored into any option pricing models like black-scholes? You're including the effect just by considering the total float of shares and net profits from cash flow when doing your modelling.\"" }, { "docid": "504089", "title": "", "text": "-I understand. If the option expires and you paid a premium of let's say $20, then you loose it. I will still have to read more obviously. If there are other ways to play the commodities market in a safer way, I am more than willing to look into it. -I understand futures and options on futures are more risky than stocks. What I am getting at is it is less risky COMPARED to regular futures. Compared to the available choices, this seems like the safest. I understand I can loose all the money I invest/speculate with. But loosing $10 (or whatever the price of said commodity options are), is still better than loosing thousands. I agree though I should do my do diligence. -What I am getting at is obviously certain things are correlated with bull or bear markets (gold bear, growth stocks bull). If you can use a combination of assets, you can have some that are winners, while some will be down. I don't expect one asset to be a super asset. -But most the stocks are overvalued, and are overrated. I have found several stocks that I am invested in (MGM Macau, Lippo Mall, and Whiting Trust II). I am also in gold, silver, small Riyal position, and Norwegian Kroner." }, { "docid": "597376", "title": "", "text": "\"When you say \"\"apartment\"\" I take it you mean \"\"condo\"\", as you're talking about buying. Right or no? A condo is generally cheaper to buy than a house of equal size and coondition, but they you have to pay condo fees forever. So you're paying less up front but you have an ongoing expense. With a condo, the condo association normally does exterior maintenance, so it's not your problem. Find out exactly what's your responsibility and what's theirs, but you typically don't have to worry about maintaining the parking areas, you have less if any grass to mow, you don't have to deal with roof or outside walls, etc. Of course you're paying for all this through your condo fees. There are two advantages to getting a shorter term loan: Because you owe the money for less time, each percentage point of interest is less total cash. 1% time 15 years versus 1% times 30 years or whatever. Also, you can usually get a lower rate on a shorter term loan because there's less risk to the bank: they only have to worry about where interest rates might go for 15 years instead of 30 years. So even if you know that you will sell the house and pay off the loan in 10 years, you'll usually pay less with a 15 year loan than a 30 year loan because of the lower rate. The catch to a shorter-term loan is that the monthly payments are higher. If you can't afford the monthly payment, then any advantages are just hypothetical. Typically if you have less than a 20% down payment, you have to pay mortgage insurance. So if you can manage 20% down, do it, it saves you a bundle. Every extra dollar of down payment is that much less that you're paying in interest. You want to keep an emergency fund so I wouldn't put every spare dime I had into a down payment if I could avoid it, but you want the biggest down payment you can manage. (Well, one can debate whether its better to use spare cash to invest in the stock market or some other investment rather than paying down the mortgage. Whole different question.) \"\"I dont think its a good idea to make any principal payments as I would probably loose them when I would want to sell the house and pay off the mortgage\"\" I'm not sure what you're thinking there. Any extra principle payments that you make, you'll get back when you sell the house. I mean, suppose you buy a house for $100,000, over the time you own it you pay $30,000 in principle (between regular payments and any extra payments), and then you sell it for $120,000. So out of that $120,000 you'll have to pay off the $70,000 balance remaining on the loan, leaving $50,000 to pay other expenses and whatever is left goes in your pocket. Scenario 2, you buy the house for $100,000, pay $40,000 in principle, and sell for $120,000. So now you subtract $60,000 from the $120,000 leaving $60,000. You put in an extra $10,000, but you get it back when you sell. Whether you make or lose money on the house, whatever extra principle you put in, you'll get back at sale time in terms of less money that will have to go to pay the remaining principle on the mortgage.\"" }, { "docid": "514375", "title": "", "text": "\"Yes, the price of a stock is what investors think the value of a stock is, which is not tied to profits or dividends by any rigid formula. But to say that therefore the price could be high even though the company is doing very poorly is hypothetically true, but unlikely in practice. Consider any other product. There is no fixed formula for the value of a used car, either. If everyone agreed that a rusting, 20-year old car that doesn't run is worth $100,000, then that's what it would sell for. But that's a pretty big \"\"if\"\" at the beginning of that sentence. If the car had been used in some hit TV show 20 years ago, or if it was owned by a celebrity, or some such special case, maybe a rusting old car really would sell for $100,000. Likewise, a stock might have a price higher than what one would predict from its dividends if some rich person wanted to buy that company because the brand name brings back nostalgic memories from his youth and so he drives the price up, etc. But the normal case is that, in the long term, the price of a stock tends to settle on a value proportional to the dividends that it pays. Or rather, and this is a big caveat, the dividends that investors expect it to pay in the future. And then adjusted for all sorts of other factors and special situations, like the value of the company if it was to be liquidated, etc.\"" }, { "docid": "9152", "title": "", "text": "\"The key point to answer the question is to consider risk aversion. Assume I suggest a game to you: Throw a coin and if you win, you get $5, if you lose nothing happens. Will you play the game? Of course, you will - you have nothing to lose! What if I suggest this: If you win, you get $10,000,005 and if you lose you must pay $10,000,000 (I also accept cars, houses, spouses, and kidneys as payment). While the expected value of the second game is the same as for the first, if you lose the second game you are more or less doomed to spend the rest of your life in poverty or not even have a rest of your life. Therefore, you will not wish to play the second game. Well, maybe you do - but probably only if you are very, very rich and can easily afford a loss (even if you had $11,000,000 you won't be as happy with a possible raise to $21,000,005 as you'd be unhappy with dropping to a mere $1,000,000, so you'd still not like to play). Some model this by taking logarithms: If your capital grows from $500 to $1000 or from $1000 to $2000, in both cases it doubles, hence is considered the same \"\"personal gain\"\", effectively. And, voíla, the logartithm of your capital grows by the same amount in both cases. This refelcts that a rich man will not be as happy about finding a $10 note as a poor man will be about finding a nickel. The effect of an insurance is that you replace an uncertain event of great damage with a certain event of little damage. Of course, the insurance company plays the same game, with roles swapped - so why do they play? One point is that they play the game very often, which tends to nivel the risks - unless you do something stupid and insure all inhabitants of San Francisco (and nobody else) against eqarthquakes. But also they have enough capital that they can afford to lose the game. In a fair situation, i.e. when the insurance costs just as much as damage cost multiplied with probability of damage, a rational you would eagerly buy the insurance because of risk aversion. Therefore, the insurance will in effect be able to charge more than the statistically fair price and many will still (gnawingly) buy it, and that's how they make a living. The decision how much more one is willing to accept as insurance cost is also a matter of whether you can afford a loss of the insured item easily, with regrets, barely, or not all.\"" }, { "docid": "245616", "title": "", "text": "\"First off, the answer to your question is something EVERYONE would like to know. There are fund managers at Fidelity who will a pay $100 million fee to someone who can tell them a \"\"safe\"\" way to earn interest. The first thing to decide, is do you want to save money, or invest money. If you just want to save your money, you can keep it in cash, certificates of deposit or gold. Each has its advantages and disadvantages. For example, gold tends to hold its value over time and will always have value. Even if Russia invades Switzerland and the Swiss Franc becomes worthless, your gold will still be useful and spendable. As Alan Greenspan famously wrote long ago, \"\"Gold is always accepted.\"\" If you want to invest money and make it grow, yet still have the money \"\"fluent\"\" which I assume means liquid, your main option is a major equity, since those can be readily bought and sold. I know in your question you are reluctant to put your money at the \"\"mercy\"\" of one stock, but the criteria you have listed match up with an equity investment, so if you want to meet your goals, you are going to have to come to terms with your fears and buy a stock. Find a good blue chip stock that is in an industry with positive prospects. Stay away from stuff that is sexy or hyped. Focus on just one stock--that way you can research it to death. The better you understand what you are buying, the greater the chance of success. Zurich Financial Services is a very solid company right now in a nice, boring, highly profitable business. Might fit your needs perfectly. They were founded in 1872, one of the safest equities you will find. Nestle is another option. Roche is another. If you want something a little more risky consider Georg Fischer. Anyway, what I can tell you, is that your goals match up with a blue chip equity as the logical type of investment. Note on Diversification Many financial advisors will advise you to \"\"diversify\"\", for example, by investing in many stocks instead of just one, or even by buying funds that are invested in hundreds of stocks, or indexes that are invested in the whole market. I disagree with this philosophy. Would you go into a casino and divide your money, putting a small portion on each game? No, it is a bad idea because most of the games have poor returns. Yet, that is exactly what you do when you diversify. It is a false sense of safety. The proper thing to do is exactly what you would do if forced to bet in casino: find the game with the best return, get as good as you can at that game, and play just that one game. That is the proper and smart thing to do.\"" }, { "docid": "51445", "title": "", "text": "There's no formula for how much is the ideal amount to spend on entertainment and fun. As JoeTaxpayer says, it's all about balance. Maybe relative costs are different in France than in the US where I live, but here, housing and the things that go with it -- electricity, heat, insurance, maybe a few other miscellaneous items -- are usually a huge portion of a young person's expenses. If you don't mind living with your parents -- and they don't mind having you -- you can save a lot of money. There are lots of things you can do for fun that don't cost a lot of money. If your idea of fun is collecting fancy cars and making round-the-world trips, yes, that can get expensive fast. When I was in my 20s, my entertainment mostly consisted of going to movies, amusement parks, and occasional concerts; and playing computer games. Those aren't super expensive as long as you don't do them every day. And keeping my car running, which saved money over buying a new car. These days I'm in a situation analogous to yours: I'm getting older, and so I'm trying to build up a retirement account so I can retire comfortably. So I have to balance how much I put away for retirement with spending on fun things now. I have certain targets, and so I budget that I will put this amount away for retirement every month, and my spending money is what I have left. I think that's better than, spend whatever I want on fun, and then put what's left toward retirement. The latter plan is probably a fast route to debt." }, { "docid": "879", "title": "", "text": "Since you are only 16, you still have time to mature what you will do with your life, always keep your mind opend. If you are really passionated about investement : read 1 book every week about investement, read the website investopedia, financial time, know about macro economic be good a math in school, learning coding and infrastructure can also be interesting since the stock is on server. learn about the history, you can watch on yoube shows about the history of money. learn accounting, the basic at least open a broker simulating account online ( you will play with a fake wallet but on real value) for 6 month, and after open a broker account with 100 real dollards and plays the penny stocks ( stock under 3 USD a share). after doing all this for 1 year you should know if you want to spend your life doing this and can choose universtity and intership accordingly. You can look on linkedin the profile of investement banker to know what school they attended. Best of luck for your future." }, { "docid": "577979", "title": "", "text": "I'm going to echo everyone else's sentiments in this thread. What a ridiculous article! You have a solid, dependable, money making star that runs her own show like a well oiled machine and your biggest critique is that she is a sound business woman? I think there is a special place in journalist hell for writers who try to get attention by only playing contrarian for the sake of being contrarian. News flash, pretty unoriginal. I'm not really a fan of her music but man do I love to see sound business people doing it right. This is worth commending." }, { "docid": "275171", "title": "", "text": "\"I (and probably most considering trading) had a similar thought as you. I thought if I just skimmed the peaks and sold before the troughs, perhaps aided by computer, I'd be able to make a 2% here, 2% there, and that would add up quickly to a nice amount of money. It almost did seem \"\"foolproof\"\". Then I realized that sometimes a stock just slides...down...and there is no peak higher than what I bought it for. \"\"That's OK,\"\" I'd think, \"\"I'm sure it will recover and surpass the price I bought it for...so now I play the waiting game.\"\" But then it continues sliding, and my $10k is now worth $7k. Do I sell? Did I build a stop loss point into my computer program? If so, what is the right place to put that stop? What if there is a freak dip down and it triggers the stop loss but THEN my stock recovers? I just lost $14,000 like this last week--luckily, only virtually! The point is, your idea only has half a chance to work when there is a mildly volatile stock that stays around some stable baseline, and even then it is not easy. And then you factor in fees as others mentioned... People do make money doing this (day traders), and some claim you can use technical analysis to time orders well, so if you want to try that, read about technical analysis on this site or elsewhere.\"" }, { "docid": "106310", "title": "", "text": "A lease payment is composed of an interest portion (borrowed money) and depreciation amount (purchase - residual). The Monthly payment is then Monthly Interest Cost + Monthly Depreciation Cost The Money Factor is used to estimate the amount of interest due in a single month of a lease so you can figure out the monthly payment. If you are borrowing $100,000 then over the entire loan of repayment from a balance of $100,000 to a balance of $0, the average amount you owed was $50,000 (1/2 of principal). You are repaying this loan monthly (1/12 of a year) and percents are expressed as decimals (1/100). 6 * 1/2 (for principal) * 1/12 (for monthly) * 1/100 (to convert percentage from 6% to .06) = 6 * 1/2400. 2400 is the product of 3 consecutive conversion (1/2 * 1/12 * 1/100) to convert from an interest rate to a money factor. 6/2400 = Money factor of 0.0025 which can be multiplied against the total amount being borrowed to know what the monthly interest would roughly equal. Some Money Factor info: https://www.alphaleasing.com/resources/articles/MoneyFactor.asp" }, { "docid": "572073", "title": "", "text": "\"To be fair, it *is* super expensive, but you also get payed more for things. I'd probably be making about 10-25% less an hour anywhere else in the US. Granted, I don't want to play myself like I'm super put upon, or even that representative. My family has money, so I have security there, and though I don't have a college degree (flipside: no debt), I'm very well educated. I also know how to cook and am incredibly handy, which probably saves me about $3-5,000 a year. But these are things one can learn if you have the inclination. Point is, people just have an incredibly inflated idea of what \"\"struggling\"\" is, and it pisses me off when they try to play a $60k a year income (and probably a $75k+ family income) as \"\"scraping by\"\" in New York. It's not. That's a good, solid income. If you can afford cable and an iphone, in the grand scheme of things, you're doing pretty damn well.\"" }, { "docid": "200946", "title": "", "text": "DO NOT DO NOT DO NOT DO THAT!!! What could happen if you lie is that they ask for pay stubs before you get an offer letter. If you don't have paystubs to back up what you claim to of made you have likely just lost your job. If they keep you anyway they will be watching you like a hawk because you have proven on the front end that you can't be trusted. I just went through this very same thing a few months ago and here is how I handled it. These numbers are made up so not to reveal my real salary, of course. I was making $2/hr and underpaid at my then company and wanted to make $10 from the new guys. I knew they wouldn't pay me $10 so I was hoping to make $6. They also wouldn't pay me $6 put they offered me $5. $5 was $3 more than I was making before so I gladly took it. I have a salary I can live with for a few years and I'm in a position to grow with the new company. Be honest and negotiate. Be prepared to explain why you think you are worth the money you say you are. Be reasonable about the situation and don't get greedy. You are doing good by them showing interest in retaining you in the first place. Play your cards correctly and professionally and you will do well. Whatever you do don't lie about anything. Good luck!!!" }, { "docid": "408918", "title": "", "text": "\"Largely, because stock markets are efficient markets, at least mostly if not entirely; while the efficient market hypothesis is not necessarily 100% correct, for the majority of traders it's unlikely that you could (on the long term) find significant market inefficiencies with the tools available to an individual of normal wealth (say, < $500k). That's what frequent trading intends to do: find market inefficiencies. If the market is efficient, then a stock is priced exactly at what it should be worth, based on risk and future returns. If it is inefficient, then you can make more money trading on that inefficiency versus simply holding it long. But in stating that a stock is inefficient, you are stating that you know something the rest of the market doesn't - or some condition is different for you than the other million or so people in the market. That's including a lot of folks who do this for a living, and have very expensive modelling software (and hardware to run it on). I like to think that I'm smarter than the far majority of people, but I'm probably not the smartest guy in the room, and I certainly don't have that kind of equipment - especially with high frequency trading nowadays. As such, it's certainly possible to make a bit of money as a trader versus as a long-term investor, but on the whole it's similar to playing poker for a living. If you're smarter than most of the people in the room, you might be able to make a bit of money, but the overhead - in the case of poker, the money the house charges for the game, in the case of stocks, the exchange fees and broker commissions - means that it's a losing game for the group as a whole, and not very many people can actually make money. Add to that the computer-based trading - so imagine a poker game where four of the eight players are computer models that are really good (and actively maintained by very smart traders) and you can see where it gets to be very difficult to trade at a profit (versus long term investments, which take advantage of the growth in value in the company). Finally, the risk because of leverage and option trading (which is necessary to really take advantage of inefficiencies) makes it not only hard to make a profit, but easy to lose everything. Again to the poker analogy, the guys I've known playing poker for a living do it by playing 10-20 games at once - because one game isn't efficient enough, you wouldn't make enough money. In poker, you can do that fairly safely, especially in limit games; but in the market, if you're leveraging your money you risk losing a lot. Every action you take to make it \"\"safer\"\" removes some of your profit.\"" }, { "docid": "574011", "title": "", "text": "\"Negative Yields on Bonds is opposite of Getting profit on your investment. This is some kind of new practice from world wide financial institute. the interest rate is -0.05% for ten years. So a $100,000 bond under those terms would be \"\"discounted\"\" to $100,501, give or take. No, actually what you are going to get out from this investment is after 10 years when this investment is mature for liquidation, you will get return not even your principle $100,000 , but ( (Principle $100,000) minus (Negative Yields @ -0.05) Times ( 10 Years ) ) assume the rates are on simple annual rate. Now anyone may wander why should someone going to buy this kind of investment where I am actually giving away not only possible profit also losing some of principle amount! This might looks real odd, but there is other valid reason for issuing / investing on such kind of bond. From investor prospective: Every asset has its own 'expense' for keeping ownership of it. This is also true for money/currency depending on its size. And other investment possibility and risk factor. The same way people maintain checking account with virtually no visible income vs. Savings account where bank issue some positive rate of interest with various time factor like annually/half-yearly/monthly. People with lower level of income but steady on flow choose savings where business personals go for checking one. Think of Millions of Ideal money with no secure investment opportunity have to option in real. Option one to keeping this large amount of money in hand, arranging all kind of security which involve extra expense, risk and headache where Option two is invest on bond issued by Government of country. Owner of that amount will go for second one even with negative yields on bonds where he is paying in return of security and risk free grantee of getting it back on time. On Issuing Government prospective: Here government actually want people not to keep money idle investing bonds, but find any possible sector to invest which might profitable for both Investor + Grater Community ultimately country. This is a basic understanding on issue/buy/selling of Negative interest bearing bond on market. Hope I could explain it here. Not to mention, English is not my 1st language at all. So ignore my typo, grammatical error and welcome to fix it. Cheers!\"" }, { "docid": "99521", "title": "", "text": "With an annual income of $120,000 you can be approved for a $2800 monthly payment on your mortgage. The trickier problem is that you will save quite a bit on that mortgage payment if you can avoid PMI, which means that you should be targeting a 20% down-payment on your next purchase. With a $500,000 budget for a new home, that means you should put $100,000 down. You only have $75,000 saved, so you can either wait until you save another $25,000, or you can refinance your current property for $95k+ $25k = $120k which would give you about a $575 monthly payment (at 30 years at 4%) on your current property. Your new property should be a little over $1,900 per month if you finance $400,000 of it. Those figures do not include property tax or home owners insurance escrow payments. Are you prepared to have about $2,500 in mortgage payments should your renters stop paying or you can't find renters? Those numbers also do not include an emergency fund. You may want to wait even longer before making this move so that you can save enough to still have an emergency fund (worth 6 months of your new higher expenses including the higher mortgage payment on the new house.) I don't know enough about the rest of your expenses, but I think it's likely that if you're willing to borrow a little more refinancing your current place that you can probably make the numbers work to purchase a new home now. If I were you, I would not count on rental money when running the numbers to be sure it will work. I would probably also wait until I had saved $100,000 outright for the down-payment on the new place instead of refinancing the current place, but that's just a reflection of my more conservative approach to finances. You may have a larger appetite for risk, and that's fine, then rental income will probably help you pay down any money you borrow in the refinancing to make this all worth it." } ]

[ { "docid": "502203", "title": "", "text": "If you want a concrete investment tip, precious metals (e.g. gold, silver) are on a pretty good run these days, personally I still think they have ways to go as there are just too many problems with modern monetary policy of an almost existential nature, and gold and silver are better stores of value than fiat money. Silver is particularly hot right now, but keep in mind that the increased volatility means increased risk. If the Fed keeps its foot on the pedals of the dollar printing press and we get QE3 this summer, that will most likely mean more people piling into the PMs to hedge against inflation. If the Fed starts to tighten it's policy then that's probably bad news for both equities and bonds and so PMs could be seen as a safe haven investment. These are the main reasons why PMs take up a good portion of my portfolio and will continue to do so untill I see how the global economy plays out over the next couple of years." } ]

[ { "docid": "588153", "title": "", "text": "A derivative is a financial instrument of a special kind, the kind “whose price depends on, or is derived from, another asset”. This definition is from John Hull, Options, Futures and Other Derivatives – a book definitely worth to own if you are curious about this, you can easily find old copies for a few dollars. The first point is that a derivative is a financial instrument, like credits, or insurances, the second point is that its price depends closely from the price of something else, the mentioned asset. In most cases derivatives can be understood as financial insurances against some risk bound to the asset. In the sequel I give a small list of derivatives and highlight the assets and the risk they can be bound to. And first, let me point out that the definition is (marginally) wrong because some derivatives depend on things which are not assets, nor do they have a price, like temperature, sunlight, or even your own life in the case of mortgages. But before going in this list, let me go through the remaining points of your question. What is the basic idea and concept behind a derivative? As already noted, in most cases, a derivative can be understood as a financial insurance compensating from a risk of some sort. In a classical insurance contract, one party of the contract is an insurance company, but in the broader case of a derivative, that counterparty can be pretty anything: an insurance, a bank, a government, a large company, and most probably market makers. How is it really used, and how does this deviate from the first point? Briefly, how does is it affecting people, and how is it causing problems? An important point with derivatives is that it can be arbitrarily complicated to compute their prices. Actually what is hidden in the attempt of giving a definition for derivatives, is that they are products whose price Y is a measurable function of one or several random variables X_1, X_2, … X_n on which we can use the theory of arbitrage pricing to get hints on the actual price Y of the asset – this is what the depends on means in technical terms. In the most favorable case, we obtain an easy formula linking Y to the X_is which tells us what is the price of our financial instrument. But in practice, it can be very difficult, if at all possible, to determine a price for derivatives. This has two implications: Persons possessing sophisticated techniques to compute the price of derivatives have a strategic advantage on derivatives market, in comparison to less advanced actors on the market. Organisation owning assets they cannot price cannot compute their bilan anymore, so that they cannot know for sure their financial situation. They are somehow playing roulette. But wait, if derivatives are insurances they should help to mitigate some financial risk, which precisely means that they should help their owners to more accurately see their financial situation! How is this not a contradiction? Some persons with sophisticated techniques to compute the price of derivatives are actually selling complicated derivatives to less knowledgeable persons. For instance, many communes in France and Germany have contracted credits whose reimbursements have a fixed interest part, like in a classical credit, and a variable interest part whose rate is computed against a complicated formula involving the value of the Swiss frank at each quarter starting from the inception of the credit. (So, for a 25 years running credit of theis type, the price Y of the credit at its inception depends on 100 Xs, which are the uncertain prices for the Swiss frank each quarter of the 25 next years.) Some of these communes can be quite small, with 5.000 inhabitants, and needless to say, do not have the required expertise to analyse the risks bound to such instruments, which in that special case led the court call the credit a swindling and to cancel the credit. But what chain of events leads a 5.000 inhabitants city in France to own a credit whose reimbursements depends on the Swiss frank? After the credit crunch in 2007 and the fall of Lehman Brothers in 2008, it has begun to be very hard to organise funding, which basically means to conclude credits running long in time on large amounts of money. So, the municipality needs a 25 years credit of 10.000.000 EUROS and goes to its communal bank. The communal bank has hundreds or thousands of municipalities looking for credits and needs itself a financing. So the communal bank goes to one of the five largest financial institutions in the world, which insists on selling a huge credit whose reimbursements have a variable part depending on hundred of values the Swiss frank will have in the 25 next years. Since the the big bank has better computation techniques than the small bank it makes a big profit. Since the small bank has no idea, how to compute the correct price of the credit it bought, it cuts this in pieces and sell it in the same form to the various communes it works with. If we were to attribute this kind of intentions to the largest five banks, we could ask about the possibility that they designed the credit to take advantage of the primitive evaluation methods of the small bank. We could also ask if they organised a cartel to force communal banks to buy their bermudean snowballs. And we could also ask, if they are so influent that they eventually can manipulate the Swiss frank to secure an even higher profit. But I will not go into this. To the best of my understanding, the subprime crisis is a play along the same plot, with different actors, but I know this latter subject only by what I could read in French newspapers. So much for the “How is it causing problems?” part. What is some of the terminology in relation to derivatives (and there meanings of course)? Answering this question is basically the purpose of the 7 first chapters of the book by Hull, along with deriving some important mathematical principles. And I will not copy these seven chapters here! How would someone get started dealing in derivatives (I'm playing a realistic stock market simulation, so it doesn't matter if your answer to this costs me money)? If you ask the question, I understand that you are not a professional, so that your are actually trying to become the one that has money and zero knowledge in the play I outlined above. I would recommand not doing this. That said, if you have a good mathematical background and can program well, once you are confindent with the books of Hull and Joshi, you can have fun implementing various market models and implementing trading strategies. Once you are confident with this, you can also read the articles on quantitative finance on arXiv.org. And once you are done with this, you can decide for yourself if you want to play the same market as the guys writing these articles. (And yes, even for the simplest options, they have better models than you have and will systematically outperform you in the long run, even if some random successes will give you the feeling that you do well and could do better.) (indeed, I've made it a personal goal to somehow lose every last cent of my money) You know your weapons! :) Two parties agree today on a price for one to deliver a commodity to the other at some future instant. This is a classical future contract, it can be modified in every imaginable way, usually by embedding options. For instance one party could have the option to choose between different delivery points or delivery days. Two parties write today a contract allowing the one party to buy at some future time a commodity to the the second party. The price is written today, as part of the contract. (There is the corresponding option entitling the owner to sell something.) Unlike the future contract, only one party can be obliged to do something, the other jas a right but no obligation. If you buy and option, your are buying some sort of insurance against a change of price on some asset. This is the most familiar to anybody. Credits can come in many different flavours, especially the formula to compute interests, or also embed options. Common options are early settlement options or restructuration options. While this is not completely inutitive, the credit works like an insurance. This is most easily understood from the side of the organisation lending the money, that speculates that the ratio of creanciers going bankrupt will be low enough for her to make profit, just like a fire insurance company speculates that the ratio of fire accidents will be low enough for her to make a profit. This is like a mortgage on a financial institution. Two parties agree that one will recive an upfront today and give a compensation to the second one if some third party defaults. Here this is an explicit insurance against the unfortuante event, where a creancier goes bankrupt. One finds here more or less standard options on electricity. But electricity have delicious particularities as it can practically not be stored, and fallout is also (usually) avoided. As for classical options, these are insurances against price moves. A swap is like two complementary credits on the same amount of money, so that it ends up in the two parties not actually exchanging the credit nominal and only paying interest one to the other — which makes only sense if these interests are computed with different formulas. Typical example are fixed rate vs. EURIBOR on some given maturity, which we interpret as an insurance against fluctuations of the EURIBOR, or a fixed rate vs. the exchange ratio between two currencies, which we interpret as an insurance against the two currencies decorrelating. Swaps are the richest and the most generic category of financial derivatives. The off-the-counter market features very imaginative, very customised insurance products. The most basic form is the insurance against drought, but you can image different dangers, and once you have it you can put it in options, in a swap, etc. For instance, a restaurant with a terrasse could enter in a weather insurance, paying each year a fixed amount of money and becoming in return an amount of money based on the amount of rainy day in a year. Actually, this list is virtually without limits!" }, { "docid": "17906", "title": "", "text": "\"This is my two cents (pun intended). It was too long for a comment, so I tried to make it more of an answer. I am no expert with investments or Islam: Anything on a server exists 'physically'. It exists on a hard drive, tape drive, and/or a combination thereof. It is stored as data, which on a hard drive are small particles that are electrically charged, where each bit is represented by that electric charge. That data exists physically. It also depends on your definition of physically. This data is stored on a hard drive, which I deem physical, though is transferred via electric pulses often via fiber cable. Don't fall for marketing words like cloud. Data must be stored somewhere, and is often redundant and backed up. To me, money is just paper with an amount attached to it. It tells me nothing about its value in a market. A $1 bill was worth a lot more 3 decades ago (you could buy more goods because it had a higher value) than it is today. Money is simply an indication of the value of a good you traded at the time you traded. At a simplistic level, you could accomplish the same thing with a friend, saying \"\"If you buy lunch today, I'll buy lunch next time\"\". There was no exchange in money between me and you, but there was an exchange in the value of the lunch, if that makes sense. The same thing could have been accomplished by me and you exchanging half the lunch costs in physical money (or credit/debit card or check). Any type of investment can be considered gambling. Though you do get some sort of proof that the investment exists somewhere Investments may go up or down in value at any given time. Perhaps with enough research you can make educated investments, but that just makes it a smaller gamble. Nothing is guaranteed. Currency investment is akin to stock market investment, in that it may go up or down in value, in comparison to other currencies; though it doesn't make you an owner of the money's issuer, generally, it's similar. I find if you keep all your money in U.S. dollars without considering other nations, that's a sort of ignorant way of gambling, you're betting your money will lose value less slowly than if you had it elsewhere or in multiple places. Back on track to your question: [A]m I really buying that currency? You are trading a currency. You are giving one currency and exchanging it for another. I guess you could consider that buying, since you can consider trading currency for a piece of software as buying something. Or is the situation more like playing with the live rates? It depends on your perception of playing with the live rates. Investments to me are long-term commitments with reputable research attached to it that I intend to keep, through highs and lows, unless something triggers me to change my investment elsewhere. If by playing you mean risk, as described above, you will have a level of risk. If by playing you mean not taking it seriously, then do thorough research before investing and don't be trading every few seconds for minor returns, trying to make major returns out of minor returns (my opinion), or doing anything based on a whim. Was that money created out of thin air? I suggest you do more research before starting to trade currency into how markets and trading works. Simplistically, think of a market as a closed system with other markets, such as UK market, French market, etc. Each can interact with each other. The U.S. [or any market] has a set number of dollars in the pool. $100 for example's sake. Each $1 has a certain value associated with it. If for some reason, the country decides to create more paper that is green, says $1, and stamps presidents on them (money), and adds 15 $1 to the pool (making it $115), each one of these dollars' value goes down. This can also happen with goods. This, along with the trading of goods between markets, peoples' attachment of value to goods of the market, and peoples' perception of the market, is what fluctates currency trading, in simple terms. So essentially, no, money is not made out of thin air. Money is a medium for value though values are always changing and money is a static amount. You are attempting to trade values and own the medium that has the most value, if that makes sense. Values of goods are constantly changing. This is a learning process for me as well so I hope this helps answers your questions you seem to have. As stated above, I'm no expert; I'm actually quite new to this, so I probably missed a few things here and there.\"" }, { "docid": "67320", "title": "", "text": "\"It may be margin loans or credit lines given to brokerages. I have no idea what a loan book is though so don't I don't really know. Also no one \"\"plays\"\" in equity markets with borrowed money unless they know for sure what they are doing or they have collateral as in the case of margin.\"" }, { "docid": "471828", "title": "", "text": "Can you even answer a simple question? Economics is not game unless you're thinking playing with people lives is a game? Government saving is giving away money? What? Do you even know what saving means? Also it's not because I don't agree with you that I don't have an open mind. I go with the facts and the facts suggest you're on another planet. Going against the status quo isn't a sign of an open mind." }, { "docid": "401792", "title": "", "text": "Why? Because when I play a game, I use every rule to my advantage. It sounds like that's what he's doing. He's also created thousands of jobs that otherwise wouldn't exist. I admire people with the inclination and skills to be a shrewd businessman. I don't know the guy personally, or much of anything about him. I'm mostly defending the practice of playing the game to win, and having the skills to do so." }, { "docid": "574374", "title": "", "text": "The question is how does $16,000/year for 6.5 years fit into your budget. Or to put it another way, what won't you be spending that money on? Housing, food, vacations, retirement fund, investments (though you can invest your car fund in the meantime), building a hefty emergency fund, kids college funds, saving for a down payment on a home, charity, etc... are all other places that money could go. I don't know what your needs are today let alone 6.5 years into the future, but I'd encourage you to consider all your financial goals and evaluate where this expense would fit. It seems your plan is to save up to the total cost of the car and then buy it in cash. That's a valid strategy, but it means you'll have no car (unless you already own one) for 6.5 years. Do you need a car? If so, what will you drive in the meantime (and even if you already own another car outright, you'll have gas and maintenance expenses)? If you don't need a car, then $100,000 is a rather extravagant purchase for something we just established you don't need. Would you be happier having this expensive car in 6.5 years, or having a series of less expensive cars starting now? Or buying a used model of the expensive car sooner? Or having no car at all? Also, a lot can change in 6.5 years. Cars will evolve and there'll be different models and options available. Maybe your salary will have doubled, or maybe you'll be unemployed. You could be living in a different city, have a different commute, and maybe you'll need a minivan to haul kids around or live in a place with bad winters and want a 4-wheel-drive. You'll also need to be prepared for the additional expenses that generally come with expensive cars, such as higher insurance and maintenance rates, and parking could be costly if you live in an expensive city. The other option, of course, if the car is truly something you need, want, and can afford, would be to save up a sizable down payment and finance the rest so you can get the car sooner. Finally, there's nothing wrong with saving your money for 6.5 years, building up that fund, and then reevaluating what makes the most sense for you at that time. Maybe it will the car, maybe something else, but the nice thing about having savings is that it gives you more options." }, { "docid": "313158", "title": "", "text": "\"There will be no police involved. The police do not care. Only the feds care, and they only care about large amounts (over $100,000). What will happen is that the teller will deposit the money like nothing is unusual, but the amount will trigger a \"\"Suspicious Transaction Report\"\" to be filed by the bank. This information goes to the US Treasury and is then circulated by the Treasury to basically every agency in the government: the Department of Defense, the FBI, the NSA, the CIA, the DEA, the IRS, etc. What happens next depends on your relationship with your bank and the personality of the bank. In my case I have made large cash transactions at two different banks, one that I had a long relationship with, and another that I had a long-standing but dormant account. The long-term one was a high end savings bank in a city. The dormant one was one of those bozo retail banks (think \"\"Citizens\"\" or \"\"Bank of America\"\") in a suburb. The long-term bank ignored my first deposit, but after I made some more including one over $50,000 in cash they summoned me via a letter. I went in, talked to the branch manager and explained why I was making the deposits. He said \"\"That sounds plausible.\"\" and that was the end of the interview. It is unlikely that they transferred the information. They probably just wrote it down. They did this because they have \"\"know your customer\"\" regulations and they wanted to be able to prove that they did \"\"due diligence\"\" in case anybody asked about it later. The suburban bank never asked any questions, but they did file the STRs. In general, there is no way to know if the bank will interview you or not. It depends on a lot of different factors. The basic factors are: how much money is it, are you doing a lot of business normally, and how well does the bank know you. If you refuse to answer the bank's questions to their satisfaction, it is a 100% chance that they will close your account. They can also file higher level reports that flag your activity as \"\"highly suspicious\"\" as opposed to just the normal \"\"suspicious\"\". As long as it is a bank employee, you should have no serious concerns unless the guy seems strange and asks really pointed questions. If you have any question whether the \"\"employee\"\" is legitimate, just verify that he/she is a bank employee. Obviously if the feds visit you, you should say nothing. The chance of this happening is 1 in a million.\"" }, { "docid": "145238", "title": "", "text": "\"Judging from your comments, you seem to be confused about the way banking works. Banks can only lend out money that they actually have: whether from deposits or investors or loans taken from other banks/government entities. The rules on how this works varies from country to country, but the principle is always the same. There is no magic money. Let's imagine a closed system. There's only one town, and that town only has one bank. There are 100 people total in town, and each has $10,000. Everyone deposits all of their money in the bank. The bank now has $1,000,000 in total deposits. You take a loan for $100,000 and buy a house. The bank now has $900,000. You make your payments of $965 per month: $833 of interest and $132 toward principal. In this ideal world, the bank has no costs associated with doing business. After one month, the bank has $1,000,000 in deposits, $900,965 in cash on hand, $99,868 in loans, and $833 in profit (from interest). Now here's the confusing part. You bought a house from someone. That person also lives in town. He takes the $100,000 you gave him and... deposits it in the bank. The bank now has $1,100,000 in deposits, $1,000,965 in cash, $99,868 in loans, and $833 in profit. Assume 10 more people buy houses at $100,000 each, taking loans for that whole amount (for the same terms you did). Assume those sellers then deposit the money back in the bank. The bank now has $2,100,000 in deposits, $1,000,965 in cash, $1,099,868 in loans, and $833 in profit. The bank is taking in $10,615 per month ($965 x 11) in loan payments, making profit of $9,163 ($833 x 11) per month from interest. This process of loans and deposits and payments can go on forever without any outside influence. This is the primary way money is created. It's like printing money without the paper. Of course, we're not in a closed system. Banks are limited in endlessly creating money, primarily by two things: Reserve Requirements are set by government agencies. They might say banks can lend until their cash on hand (or liquid equivalent) is, at minimum, 35% of total deposits. So a bank with $1,000,000 in deposits would have to keep $350,000 in cash at any given time. Capital Requirements work largely the same way. It's more the bank saying, \"\"What happens if a bunch of people want their deposits back?\"\" They plan a reasonable amount of cash to have on hand for that scenario.\"" }, { "docid": "358795", "title": "", "text": "\"The loan-to-value ratio (LTV Ratio) is a lending risk assessment ratio that financial institutions and others lenders examine before approving a mortgage. It sounds like your lender has a 60% requirement. Remember the home is the collateral for the loan. If you stop making payments, they can take the house back from you. That number is less than 100% to accommodate changing market prices, the cost of foreclosure, repairing and reselling the home. They may be a safety factor built in depending on the home's location. If you want to buy a $1.8 million dollar home you will have to come up with 40% down payment. That down payment is what reduces the risk for the lender. So no, there is no way to cheat that. Think about the transaction from the view of the lender. Note: in some areas, you can still get a loan if you don't have the required down payment. You just have to pay a monthly mortgage insurance. It's expensive but that works for many home buyers. A separate insurance company offers a policy that helps protect the lender when there isn't enough deposit paid. Update: Er, no. Keep it simple. The bank will only loan you money if it has collateral for the loan. They've built in a hefty safety margin to protect them in case you quit paying them your monthly payments. If you want to spend the money on something else, that would work as long as you provide collateral to protect the lender. You mention borrowing money for some other purpose then buying a home. That would be fine, but you will have to come up with some collateral that protect the lender. If you wanted to buy a new business, the bank would first ask for an appraisal of the value of the assets of the business. That could be applied to the collateral safety net for the lender. If you wanted to buy a business that had little appraisal value, then the bank would require more collateral from you in other forms. Say you wanted to borrow the money for an expensive operation or cosmetic surgery. In that case there is no collateral value in the operation. You can't sell anything from the surgery to anybody to recover costs. The money is spent and gone. Before the bank would loan you any money for such a surgery, they would require you to provide upfront collateral. (in this case if you were to borrow $60,000 for surgery, the bank would require $100,000 worth of collateral to protect their interest in the loan.) You borrow money, then you pay it back at a regular interval at an agreed upon rate and schedule. Same thing for borrowing money for the stock market or a winning horse at the horse race. A lender will require a hard asset as collateral before making you a loan... Yes I know you have a good tip on a winning horse,and you are bound to double your money, but that's not the way it works from a lender's point of view. It sounds like you are trying to game the system by playing on words. I will say quit using the \"\"40% to 60%\"\" phrase. That is just confusing. The bank's loan to value is reported as a single number (in this case 60%) For every $6000 you want to borrow, you have to provide an asset worth $10,000 as a safety guarantee for the loan. If you want to borrow money for the purchase of a home, you will need to meet that 60% safety requirement. If you want to borrow $1,000,000 cash for something besides a home, then you will have to provide something with a retail value of $1,666,667 as equity. I think the best way for you to answer your own question is for you to pretend to be the banker, then examine the proposal from the banker's viewpoint. Will the banker alway have enough collateral for whatever it is you are asking to borrow? If you don't yet have that equity, and you need a loan for something besides a home, you can always save your money until you do have enough equity. Comment One. I thought that most lenders had a 75% or 80% loan to value ratio. The 60% number seems pretty low. That could indicate you may be a high risk borrower, or possibly that lender is not the best for you. Have you tried other lenders? It's definitely worth shopping around for different lenders. Comment Two. I will say, it almost sounds like you aren't being entirely honest with us here. No way someone with a monthly income who can afford a $1.8 Million home would be asking questions like this. I get that English probably isn't your first language, but still. The other thing is: If you are truly buying a $1.8 Million dollar home your real estate agent would be helping you find a lender that will work with you. They would be HIGHLY motivated to see this sale happen. All of your questions could be answered in ten minutes with a visit to your local bank (or any bank for that matter.) When you add up the costs and taxes and insurance on a 30 fixed loan, you'd have a monthly mortgage payment of nearly $10,500 a month or more. Can you really afford that on your monthly income?\"" }, { "docid": "597376", "title": "", "text": "\"When you say \"\"apartment\"\" I take it you mean \"\"condo\"\", as you're talking about buying. Right or no? A condo is generally cheaper to buy than a house of equal size and coondition, but they you have to pay condo fees forever. So you're paying less up front but you have an ongoing expense. With a condo, the condo association normally does exterior maintenance, so it's not your problem. Find out exactly what's your responsibility and what's theirs, but you typically don't have to worry about maintaining the parking areas, you have less if any grass to mow, you don't have to deal with roof or outside walls, etc. Of course you're paying for all this through your condo fees. There are two advantages to getting a shorter term loan: Because you owe the money for less time, each percentage point of interest is less total cash. 1% time 15 years versus 1% times 30 years or whatever. Also, you can usually get a lower rate on a shorter term loan because there's less risk to the bank: they only have to worry about where interest rates might go for 15 years instead of 30 years. So even if you know that you will sell the house and pay off the loan in 10 years, you'll usually pay less with a 15 year loan than a 30 year loan because of the lower rate. The catch to a shorter-term loan is that the monthly payments are higher. If you can't afford the monthly payment, then any advantages are just hypothetical. Typically if you have less than a 20% down payment, you have to pay mortgage insurance. So if you can manage 20% down, do it, it saves you a bundle. Every extra dollar of down payment is that much less that you're paying in interest. You want to keep an emergency fund so I wouldn't put every spare dime I had into a down payment if I could avoid it, but you want the biggest down payment you can manage. (Well, one can debate whether its better to use spare cash to invest in the stock market or some other investment rather than paying down the mortgage. Whole different question.) \"\"I dont think its a good idea to make any principal payments as I would probably loose them when I would want to sell the house and pay off the mortgage\"\" I'm not sure what you're thinking there. Any extra principle payments that you make, you'll get back when you sell the house. I mean, suppose you buy a house for $100,000, over the time you own it you pay $30,000 in principle (between regular payments and any extra payments), and then you sell it for $120,000. So out of that $120,000 you'll have to pay off the $70,000 balance remaining on the loan, leaving $50,000 to pay other expenses and whatever is left goes in your pocket. Scenario 2, you buy the house for $100,000, pay $40,000 in principle, and sell for $120,000. So now you subtract $60,000 from the $120,000 leaving $60,000. You put in an extra $10,000, but you get it back when you sell. Whether you make or lose money on the house, whatever extra principle you put in, you'll get back at sale time in terms of less money that will have to go to pay the remaining principle on the mortgage.\"" }, { "docid": "434799", "title": "", "text": "\"I'm trying to understand how an ETF manager optimized it's own revenue. Here's an example that I'm trying to figure out. ETF firm has an agreement with GS for blocks of IBM. They have agreed on daily VWAP + 1% for execution price. Further, there is a commission schedule for 5 mils with GS. Come month end, ETF firm has to do a monthly rebalance. As such must buy 100,000 shares at IBM which goes for about $100 The commission for the trade is 100,000 * 5 mils = $500 in commission for that trade. I assume all of this is covered in the expense ratio. Such that if VWAP for the day was 100, then each share got executed to the ETF at 101 (VWAP+ %1) + .0005 (5 mils per share) = for a resultant 101.0005 cost basis The ETF then turns around and takes out (let's say) 1% as the expense ratio ($1.01005 per share) I think everything so far is pretty straight forward. Let me know if I missed something to this point. Now, this is what I'm trying to get my head around. ETF firm has a revenue sharing agreement as well as other \"\"relations\"\" with GS. One of which is 50% back on commissions as soft dollars. On top of that GS has a program where if you do a set amount of \"\"VWAP +\"\" trades you are eligible for their corporate well-being programs and other \"\"sponsorship\"\" of ETF's interests including helping to pay for marketing, rent, computers, etc. Does that happen? Do these disclosures exist somewhere?\"" }, { "docid": "509266", "title": "", "text": "I just graduated from college and I am already planning my retirement. ... in terms of money sitting in my bank account post retirement, assuming Ii have $250,000 what is the highest interest that I can earn with it? Assuming you are 22, and will retire in 45 years at age 67. There is no way to predict interest rates. When I was 22 and just out of college I started putting money into a bank account to save for a down payment. The rate for a savings account was 6%. That means that every month I made 1/2 of one percent. Today that same credit union offers a money maker account with a minimum balance of $100,000 that pays 0.25% for the year. What I made in a month would take two years to make today. Keep in mind we also can't estimate your pay in the last year before retirement, or the inflation rate for the next 45 years, or the mortgage rate, or the availability of Social Security, or the returns of the S&P for 45 years. It is great you are starting to think about this today. But you will have to keep adjusting parts of your plan as the years go by: You may have to factor in children, your medical situation... Even if the interest rates recover you may not want to put all your post retirement money in the bank. Most people can't sustain the required flow of money for their 30 years of retirement from savings accounts. As for today. FDIC (or similar accounts from credit unions) will not have rates approaching 3%. It can't even approach that 3% rate via multi-year CDs. My credit union has a 6 year CD for almost 2%. If the goal of the money is safety then don't expect to find those high rates now. Some institutions may offer high rates without that FDIC protection, but that is risky." }, { "docid": "9152", "title": "", "text": "\"The key point to answer the question is to consider risk aversion. Assume I suggest a game to you: Throw a coin and if you win, you get $5, if you lose nothing happens. Will you play the game? Of course, you will - you have nothing to lose! What if I suggest this: If you win, you get $10,000,005 and if you lose you must pay $10,000,000 (I also accept cars, houses, spouses, and kidneys as payment). While the expected value of the second game is the same as for the first, if you lose the second game you are more or less doomed to spend the rest of your life in poverty or not even have a rest of your life. Therefore, you will not wish to play the second game. Well, maybe you do - but probably only if you are very, very rich and can easily afford a loss (even if you had $11,000,000 you won't be as happy with a possible raise to $21,000,005 as you'd be unhappy with dropping to a mere $1,000,000, so you'd still not like to play). Some model this by taking logarithms: If your capital grows from $500 to $1000 or from $1000 to $2000, in both cases it doubles, hence is considered the same \"\"personal gain\"\", effectively. And, voíla, the logartithm of your capital grows by the same amount in both cases. This refelcts that a rich man will not be as happy about finding a $10 note as a poor man will be about finding a nickel. The effect of an insurance is that you replace an uncertain event of great damage with a certain event of little damage. Of course, the insurance company plays the same game, with roles swapped - so why do they play? One point is that they play the game very often, which tends to nivel the risks - unless you do something stupid and insure all inhabitants of San Francisco (and nobody else) against eqarthquakes. But also they have enough capital that they can afford to lose the game. In a fair situation, i.e. when the insurance costs just as much as damage cost multiplied with probability of damage, a rational you would eagerly buy the insurance because of risk aversion. Therefore, the insurance will in effect be able to charge more than the statistically fair price and many will still (gnawingly) buy it, and that's how they make a living. The decision how much more one is willing to accept as insurance cost is also a matter of whether you can afford a loss of the insured item easily, with regrets, barely, or not all.\"" }, { "docid": "409717", "title": "", "text": "I have to ask: At what point do people take into account their own financial responsibility when it comes to these fees? Don't get me wrong, I've been in that overdraft fee loop before and it was brutal so I took my business else where... what I didn't realize at the time was that I did exactly what the bank wanted me to do. Either pay up for the bank forwarding money on my behalf, or gtfo. Banks aren't obligated to do shit with our pennies. By asking them to hold on to our cash, they provide a service including all the attached fine print. Trickery is obviously foul play, but so is constantly over-drawing an account. One or two overdraws should be red flag enough that you're not paying attention to your money. But this isn't the case for our culture. We get penalized then act like victims." }, { "docid": "472179", "title": "", "text": "\"I think something telling about this article is how infatuated people seem to be with the 1%. The 1% are exactly that...ONE...FUCKING..PERCENT. Shouldn't we be happy that the top 1% are earning significantly more than $100,000. The argument of whether or not $100,000 is a \"\"good\"\" salary is a far different argument. As many have brought up already, location is a large factor in how far your money will go as well as other factors, but that's not my point. \"\"But as income inequality in the US continues to worsen, a $100,000 salary creeps ever-closer to being an upper-middle-class income, not a sure sign of wealth.\"\" The article seems to subtly suggest one should be unsatisfied that they are not part of or close to being included in the 1% or seen as wealthy.\"" }, { "docid": "408918", "title": "", "text": "\"Largely, because stock markets are efficient markets, at least mostly if not entirely; while the efficient market hypothesis is not necessarily 100% correct, for the majority of traders it's unlikely that you could (on the long term) find significant market inefficiencies with the tools available to an individual of normal wealth (say, < $500k). That's what frequent trading intends to do: find market inefficiencies. If the market is efficient, then a stock is priced exactly at what it should be worth, based on risk and future returns. If it is inefficient, then you can make more money trading on that inefficiency versus simply holding it long. But in stating that a stock is inefficient, you are stating that you know something the rest of the market doesn't - or some condition is different for you than the other million or so people in the market. That's including a lot of folks who do this for a living, and have very expensive modelling software (and hardware to run it on). I like to think that I'm smarter than the far majority of people, but I'm probably not the smartest guy in the room, and I certainly don't have that kind of equipment - especially with high frequency trading nowadays. As such, it's certainly possible to make a bit of money as a trader versus as a long-term investor, but on the whole it's similar to playing poker for a living. If you're smarter than most of the people in the room, you might be able to make a bit of money, but the overhead - in the case of poker, the money the house charges for the game, in the case of stocks, the exchange fees and broker commissions - means that it's a losing game for the group as a whole, and not very many people can actually make money. Add to that the computer-based trading - so imagine a poker game where four of the eight players are computer models that are really good (and actively maintained by very smart traders) and you can see where it gets to be very difficult to trade at a profit (versus long term investments, which take advantage of the growth in value in the company). Finally, the risk because of leverage and option trading (which is necessary to really take advantage of inefficiencies) makes it not only hard to make a profit, but easy to lose everything. Again to the poker analogy, the guys I've known playing poker for a living do it by playing 10-20 games at once - because one game isn't efficient enough, you wouldn't make enough money. In poker, you can do that fairly safely, especially in limit games; but in the market, if you're leveraging your money you risk losing a lot. Every action you take to make it \"\"safer\"\" removes some of your profit.\"" }, { "docid": "375657", "title": "", "text": "what is the mechanism by which they make money on the funds that I have in my account? Risk drives TD Ameritrade to look for profits, Turukawa's storytelling about 100,000$ and 500$ is trivial. The risk consists of credit risk, asset-liability risk and profit risk. The third, based on Pareto Principle, explains the loss-harvesting. The pareto distribution is used in all kind of decentralized systems such as Web, business and -- if I am not totally wrong -- the profit risk is a thing that some authorities require firms to investigate, hopefully someone could explain you more about it. You can visualize the distribution with rpareto(n, shape, scale) in R Statistics -program (free). Wikipedia's a bit populist description: In the financial services industry, this concept is known as profit risk, where 20% or fewer of a company's customers are generating positive income while 80% or more are costing the company money. Read more about it here and about the risk here." }, { "docid": "84422", "title": "", "text": "\"OneTwoTrade is a binary option seller, and they are officially licensed by the Malta Gaming Authority. They are not in any way licensed or regulated as an investment, because they don't do actual investing. Is your money safe? If you mean will they take your money and run off with it, then no they probably won't just take your deposit and refuse to return any money to you for nothing - that would be a terrible way to make money for the long-term. If you mean \"\"will I lose my money?\"\" - oh yeah, you probably will! Binary options - outside of special sophisticate financial applications - are for people who think day trading has too little risk, or who would prefer online poker with a thin veneer of \"\"it's an investment!\"\" In the words of Forbes, Don't Gamble On Binary Options: If people want to gamble, that’s their choice. But let’s not confuse that with investing. Binary options are a crapshoot, pure and simple. These kinds of businesses run like a casino - there's a built-in house advantage, you are playing odds (which are against you), and the fundamental product is trying to bet on short-term volatility in financial markets. This is often ridiculously short-terms, measured in minutes. It's often called \"\"all or nothing options\"\", because if you bet wrong you lose almost everything - they give you a little bit of the money you bet back (so you will bet again, preferably with more of your own money). If you bet correctly you get a pay-out, just like in craps or roulette. If you are looking to gamble online, this is one method to do it. But this isn't investing, you are as mathematically likely to lose your money and/or become addicted as any other form of money-based gambling, and absolutely treat it the same way you would a casino: decide how much money you are willing to spend on the adventure before you start, and expect you'll likely not get much or any of that money back. However, I will moralize on this point - I really hate being lied to. Casinos, sports betting, and poker all generally have the common decency to call it what it is - a game where you are playing/betting. These sorts of \"\"investment\"\" providers are woefully dishonest: they say it's an exciting financial market, a new type of investment, investors are moving to this to secure their futures, etc. It's utterly deceptive and vile, and it's all about as up-front and honest as penny auction websites. If you are going to gamble, I'd urge you to do it with people who have the decency to to call it gambling and not lie to you and ask for a \"\"minimum investment\"\".\"" }, { "docid": "35680", "title": "", "text": "Yes, you should be saving for retirement. There are a million ideas out there on how much is a reasonable amount, but I think most advisor would say at least 6 to 10% of your income, which in your case is around $15,000 per year. You give amounts in dollars. Are you in the U.S.? If so, there are at least two very good reasons to put money into a 401k or IRA rather than ordinary savings or investments: (a) Often your employer will make matching contributions. 50% up to 6% of your salary is pretty common, i.e. if you put in 6% they put in 3%. If either of your employers has such a plan, that's an instant 50% profit on your investment. (b) Any profits on money invested in an IRA or 401k are tax free. (Effectively, the mechanics differ depending on the type of account.) So if you put $100,000 into an IRA today and left it there until you retire 30 years later, it would likely earn something like $600,000 over that time (assuming 7% per year growth). So you'd pay takes on your initial $100,000 but none on the $600,000. With your income you are likely in a high tax bracket, that would make a huge difference. If you're saying that you just can't find a way to put money away for retirement, may I suggest that you cut back on your spending. I understand that the average American family makes about $45,000 per year and somehow manages to live on that. If you were to put 10% of your income toward retirement, then you would be living on the remaining $171,000, which is still almost 4 times what the average family has. Yeah, I make more than $45,000 a year too and there are times when I think, How could anyone possibly live on that? But then I think about what I spend my money on. Did I really need to buy two new computer printers the last couple of months? I certainly could do my own cleaning rather than hiring a cleaning lady to come in twice a month. Etc. A tough decision to make can be paying off debt versus putting money into an investment account. If the likely return on investment is less than the interest rate on the loan, you should certainly concentrate on paying off the loan. But if the reverse is true, then you need to decide between likely returns and risk." } ]

[ { "docid": "447167", "title": "", "text": "In the United states the US government has the Small Business Administration. They also have Small Business Development Centers SMDC to help. These are also supported by state governments and colleges and universities. SBDCs provide services through professional business advisors such as: development of business plans; manufacturing assistance; financial packaging and lending assistance; exporting and importing support; disaster recovery assistance; procurement and contracting aid; market research services; aid to 8(a) firms in all stages; and healthcare information. SBDCs serve all populations, including: minorities; women; veterans, including reservists, active duty, disabled personnel, and those returning from deployment; personnel with disabilities; youth and encore entrepreneurs; as well as individuals in low and moderate income urban and rural areas. Based on client needs, local business trends and individual business requirements, SBDCs modify their services to meet the evolving needs of the hundreds of small business community in which they are situated. SBDC assistance is available virtually anywhere with 63 Host networks branching out with more than 900 service delivery points throughout the U.S., the District of Columbia, Guam, Puerto Rico, American Samoa and the U.S. Virgin Islands,. Your local SBDC should be able to help you identify local sources of funds, including government backed loans for small businesses." } ]

[ { "docid": "269969", "title": "", "text": "&gt; Which is why you'll essentially never find anybody running less than $10m, and usually more than that. 1) You have to get started somewhere. 2) If you're already trading your own account, why not spend 5k or so to start a hedge fund and earn additional money managing other people's money too? 3) It seems to me you are only looking at normal hedge funds and not considering the thousands of micro sized hedge funds which largely go un-reported on. Even those do indeed typically start with 500k-5 mil, but to suggest that I can't start one with 100-150k is simply nonsense. I did, and anyone else can too if they go through the proper paperwork (management LLC, fund LP, memorandum of offering written up, etc), and get the proper NASD licensing. BTW, now that I think about it more, I think mine was 150k, not 100k. Never-the-less, it was certainly one of the smallest ever." }, { "docid": "23108", "title": "", "text": "More shares mean less volatility because it takes a larger number of trades, a larger number of shares per trade, or a combination of both to raise or lower the stock price. Institutional investors (mutual funds, pensions, hedge funds, other investment firms, etc) are the sorts of organizations with the large amounts of money needed to move a stock price one way or the other. But the more floating shares there are in a company, the harder it is for one or two firms to move a stock price. A company with fewer floating shares wouldn't require as many trades (or as many shares per trade) to see wider swings in price. When it comes to stock price, insider trading isn't the same as manipulation. In the (surprisingly few) cases of insider trading that are prosecuted, it tends to be an individual (or small group) with early access to information that the broader market doesn't have being able to buy or sell ahead of the broader market. Their individual sales are seldom if ever enough to noticeably move a stock price. They're locking in profit or limiting a loss. Manipulation might (but doesn't always) precede insider trading, if misinformation (or truth) is released for the purpose of creating a situation that can be profited from via a trade or trades." }, { "docid": "450577", "title": "", "text": "Most of the information we get about how a company is running its business, in any market, comes from the company. If the information is related to financial statements, it is checked by an external audit, and then provided to the public through official channels. All of these controls are meant to make it very unlikely for a firm to commit fraud or to cook its books. In that sense the controls are successful, very few firms provide fraudulent information to the public compared with the thousands of companies that list in stock markets around the world. Now, there is still a handful of firms that have committed fraud, and it is probable that a few firms are committing fraud right now. But, these companies go to great lengths to keep information about their fraud hidden from both the public and the authorities. All of these factors contribute to such frauds being black swan events to the outside observer. A black swan event is an event that is highly improbable, impossible to foresee with the information available before the event (it can only be analyzed in retrospect), and it has very large impact. The classification of an event as a black swan depends on your perspective. E.g. the Enron collapse was not as unexpected to the Enron executives as it was to its investors. You cannot foresee black swan events, but there are a few strategies that allow you to insure yourself against them. One such strategy is buying out of the money puts in the stocks where you have an investment, the idea being that in the event of a crash - due to fraud or whatever other reason - the profits in your puts would offset the loses on the stock. This strategy however suffers from time and loses a little money every day that the black swan doesn't show up, thanks to theta decay. So while it is not possible to detect fraud before investing, or at least not feasible with the resources and information available to the average investor, it is possible to obtain some degree of protection against it, at a cost. Whether that cost is too high or not, is the million dollar question." }, { "docid": "347946", "title": "", "text": "\"To answer your question briefly: net income is affected by many things inside and outside of management control, and must be supplemented by other elements to gain a clear picture of a company's health. To answer your question in-depth, we must look at the history of financial reporting: Initially, accounting was primarily cash-based. That is, a business records a sale when a customer pays them cash, and records expenses when cash goes out the door. This was not a perfectly accurate system, as cashflow might be quite erratic even if sales are stable (collection times may differ, etc.). To combat problems with cash-based accounting, financial reporting moved to an accrual-based system. An accrual is the recording of an item before it has fully completed in a cash transaction. For example, when you ship goods to a customer and they owe you money, you record the revenue - then you record the future collection of cash as a balance sheet item, rather than an income statement item. Another example: if your landlord charges you rent on December 31st for the past year, then in each month leading up to December, you accrue the expense on the income statement, even though you haven't paid the landlord yet. Accrual-based accounting leaves room for accounting manipulation. Enron is a prime example; among other things, they were accruing revenue for sales that had not occurred. This 'accelerated' their income, by having it recorded years before cash was ever collectible. There are specific guidelines that restrict doing things like this, but management will still attempt to accelerate net income as much as possible under accounting guidelines. Public companies have their financial statements audited by unrelated accounting firms - theoretically, they exist to catch material misstatements in the financial statements. Finally, some items impacting profit do not show up in net income - they show up in \"\"Other Comprehensive Income\"\" (OCI). OCI is meant to show items that occurred in the year, but were outside of management control. For example, changes in the value of foreign subsidiaries, due to fluctuations in currency exchange rates. Or changes in the value of company pension plan, which are impacted by the stock market. However, while OCI is meant to pick up all non-management-caused items, it is a grey area and may not be 100% representative of this idea. So in theory, net income is meant to represent items within management control. However, given the grey area in accounting interpretation, net income may be 'accelerated', and it also may include some items that occurred by some 'random business fluke' outside of company control. Finally, consider that financial statements are prepared months after the last year-end. So a company may show great profit for 2015 when statements come out in March, but perhaps Jan-March results are terrible. In conclusion, net income is an attempt at giving what you want: an accurate representation of the health of a company in terms of what is under management control. However it may be inaccurate due to various factors, from malfeasance to incompetence. That's why other financial measures exist - as another way to answer the same question about a company's health, to see if those answers agree. ex: Say net income is $10M this year, but was only $6M last year - great, it went up by $4M! But now assume that Accounts Receivable shows $7M owed to the company at Dec 31, when last year there was only $1M owed to the company. That might imply that there are problems collecting on that additional revenue (perhaps revenue was recorded prematurely, or perhaps they sold to customers who went bankrupt). Unfortunately there is no single number that you can use to see the whole company - different metrics must be used in conjunction to get a clear picture.\"" }, { "docid": "405181", "title": "", "text": "So, people deposit money with you, you agree to pay them fixed % back, and then you invest money for your own profit? Sounds like a bank to me. Or a dividend-paying mutual fund, or a number of other similar ideas. Sure, you're welcome to start something like that up; it's unlikely you'd get money from people unless you had already proved yourself competent as an investor, though. After all, if it's possible to get a safe, comfortable 5%, why would anyone give you money at 2% or 3% instead of just getting that 5% for themselves? Or, more likely, finding a competitor who gives 4.9%? As in most things, the market will find inefficiencies like this and squash them like bugs. That said, there are some opportunities that take advantage of other kinds of situations. The most common I'd say is owning a home. You take out a mortgage for 80% of the value of the home, instead of buying it outright, and you instead invest the 80% in the market. You likely will beat your mortgage rate given the current 3.5%-4% rates. That's effectively doing the same thing, with an expense you'd have anyway (you always have to live somewhere); since it's a secured loan, you get better rates than the market will give (as it's quite safe) and you can use tax laws in your favor (mortgage interest deduction, in particular, and the capital gains break on primary residences)." }, { "docid": "404339", "title": "", "text": "I was wondering what relations are between brokerage companies and exchanges? Are brokers representing investors to trade on exchanges? Yes...but a broker may also buy and sell stocks for his own account. This is called broker-delaer firm. For individual investors, what are some cons and pros of trading on the exchanges directly versus indirectly via brokers? Doesn't the former save the investors any costs/expenses paid to the brokers? Yes, but to trade directly on an exchange, you need to register with them. That costs money and only a limited number of people can register I believe. Note that some (or all?) exchanges have their websites where I think trading can be done electronically, such as NASDAQ and BATS? Can almost all stocks be found and traded on almost every exchange? In other words, is it possible that a popular stock can only be found and traded on one exchange, but not found on the other exchange? If needed to be more specific, I am particularly interested in the U.S. case,and for example, Apple's stock. Yes, it is very much possible with smaller companies. Big companies are usually on multiple exchanges. What are your advices for choosing exchange and choosing brokerage companies? What exchanges and brokerage companies do you recommend? For brokerage companies, a beginner can go with discount broker. For sophisticated investors can opt for full service brokers. Usually your bank will have a brokerage firm. For exchanges, it depends...if you are in US, you should send to the US exchanges. IF you wish to send to other exchanges in other countries, you should check with the broker about that." }, { "docid": "118485", "title": "", "text": "\"There are a couple of misconceptions I think are present here: Firstly, when people say \"\"interest\"\", usually that implies a lower-risk investment, like a government bond or a money market fund. Some interest-earning investments can be higher risk (like junk bonds offered by near-bankrupt companies), but for the most part, stocks are higher risk. With higher risk comes higher reward, but obviously also the chance for a bad year. A \"\"bad year\"\" can mean your fund actually goes down in value, because the companies you are invested in do poorly. So calling all value increases \"\"interest\"\" is not the correct way to think about things. Secondly, remember that \"\"Roth IRA fund\"\" doesn't really tell you what's \"\"inside\"\" it. You could set up your fund to include only low-risk interest earning investments, or higher risk foreign stocks. From what you've said, your fund is a \"\"target retirement date\"\"-type fund. This typically means that it is a mix of stocks and bonds, weighted higher to bonds if you are older (on the theory of minimizing risk near retirement), and higher to stocks if you are younger (on the theory of accepting risk for higher average returns when you have time to overcome losses). What this means is that assuming you're young and the fund you have is typical, you probably have ~50%+ of your money invested in stocks. Stocks don't pay interest, they give you value in two ways: they pay you dividends, and the companies that they are a share of increase in value (remember that a stock is literally a small % ownership of the company). So the value increase you see as the increase due to the increase in the mutual fund's share price, is part of the total \"\"interest\"\" amount you were expecting. Finally, if you are reading about \"\"standard growth\"\" of an account using a given amount of contributions, someone somewhere is making an assumption about how much \"\"growth\"\" actually happens. Either you entered a number in the calculator (\"\"How much do you expect growth to be per year?\"\") or it made an assumption by default (probably something like 7% growth per year - I haven't checked the math on your number to see what the growth rate they used was). These types of assumptions can be helpful for general retirement planning, but they are not \"\"rules\"\" that your investments are required by law to follow. If you invest in something with risk, your return may be less than expected.\"" }, { "docid": "116574", "title": "", "text": "Not to be an asshole but the fact you are even asking the above tells me any form of financial service may not be for you. How the fuck can you be licensed and not have a basic understanding of what it means? And even further, that rules for doing/not doing are much more determined by individual jobs and firm rules than by some industry exam. You have confirmed my belief that our industry licensing is equivalent to a food handler's card, thank you." }, { "docid": "512381", "title": "", "text": "\"&gt; can I use venture like that in a financial context, or does it refer specifically to venture capital? Yes, any business is a \"\"venture\"\" so to speak. &gt; so they would receive a smaller return, yes? POSSIBLY yes. Mezzanine investors are, well, \"\"middle\"\" investors. They're beyond seed and venture capital, but before more \"\"late-stage\"\" private investment. That doesn't *necessarily* mean they're \"\"after a seed or venture capital investment.\"\" It can mean that, or it can simply mean the business is a little more advanced than a pure idea, or pre-revenue, etc. Let's say a company is pre-destined to get to $100m in value IF it can secure funding. Naturally, later investors will have a smaller return. Of course, private investments are generally for smaller, younger companies, and thus are more risky, so an investor can still *lose* value in a private equity investment. &gt; Is mezzanine investing particularly profitable? Yes, absolutely. You have to understand, with investments in private equity, firms and individuals are often looking for a *multiple* of their investment (i.e. if an investor invests $1m, they expect $2m, $3m, etc. back). This is not necessarily for all levels of private equity, but many levels will attempt this. Generally the idea (as far as I'm aware) is a 20% IRR (which means that generally, the investment grows by 20% *compounding* yearly). &gt; Secondly, why is dilution so important further down the road? Is it to do with valuation? Absolutely. Let's think of our example earlier, where you, me, and Joe each own 33% at $300 total value. If suddenly another company wants to buy ALL of our equity for $600, then we're all pretty happy. Each of us will get $200. HOWEVER, let's say Joe hadn't come along. If that other company *then* made an offer for $600, we'd both get *$300* for the company. There's some other things about dilution too, such as the possible loss of control, but we'll save that for later. &gt; Finally, at what point would a company aim to meet an IPO? Is it case specific, or is there a general understanding of the \"\"best time\"\"? It's VERY case specific. In *most* cases, depending on the industry, the company will be relatively a bit older, have both revenue and profitability, and a history of operations. In some cases, companies like this will choose to *never* go IPO (such as the Big 4 auditing firms, for one, among others). There are, of course, exceptions. Many smaller pharmacueticals are *pre-revenue* and are traded on the market. Tesla is getting revenue, but *not profitable* and it's on the markets as well. These are, naturally, riskier investments, but at least you've got liquidity to help a bit with that. When a private equity (PE) firm is looking to exit (sell their stake) through an IPO, they will try to engineer the company to be as attractive as possible to public investors. In fact, many PE firms will stipulate specific terms, and possibly get control of the company from the owner, when they initially invest. But there's a lot that goes into it. Perhaps /u/wreckingcru or /u/Seraphinic can go into a bit more detail on PE exits as while it's my chief interest and my career goal, it's not quite where I'm at *yet.*\"" }, { "docid": "453961", "title": "", "text": "\"Is it possible if (After getting EIN) I change my LLC type (disregarded entity or C type or S type or corporation or change in number of members) for tax saving ? You marked your question as \"\"real-estate\"\", so I'm guessing you're holding rental properties in your LLC. That means that you will not be able to qualify for S-Corp, only C-Corp treatment. That in turn means that you'll be subject to double taxation and corporate tax rate. I fail to see what tax savings you're expecting in this situation. But yes, you can do it, if you so wish. I suggest you talk to a licensed tax adviser (EA/CPA licensed in your State) before you make any changes, because it will be nearly impossible to reverse the check-the-box election once made (for at least 5 years).\"" }, { "docid": "126743", "title": "", "text": "\"Most answers have concentrated on this being a scam, however, it is possible this is an innocent mistake. Australian bank account numbers do not have redundant digits to be used to validate an account number; all of the numbers are data and uniquely identify a bank and branch (the BSB number) and an account (the Account number). Computer check digits are not part of bank account numbers because bank account numbers pre-date computers. It is entirely possible that someone entering an incorrect number can, by chance, hit upon an existing account. As the bank clearance system in Australia is entirely automatic there is no cross-checking of account numbers with account names. Internet banking in Australia is not a wire-transfer as is common in places like the USA (although these can be done): here you are effectively accessing your bank's \"\"back office\"\". Nor is it like the BPay service which is used primarily by B to C businesses as a way for their customers to pay their bills; when using this service the biller code will show you who you are paying and the customer number does have check digit validation. I run a business in Australia and it has happened to us on several occasions than an employee or supplier has given us incorrect numbers. Usually, it is not a real account and after a week or so the money makes its way back to us with a message like NO ACCOUNT or A/C CLOSED. Very occasionally, however, the wrong number hits a live account: when that happens the person who f*&ked up needs to contact their bank and try and get the transaction reversed. If there is money in the destination account this usually happens with little fuss, however, if the destination account has been closed or emptied things get problematic. Of course, taking money that isn't yours is stealing even if it happens to be sitting in your bank account. However, unless the sum involved is significant the police are usually not interested in diverting their attention away from \"\"serious\"\" crimes like homicide, armed robbery and terrorism so the aggrieved party is usually on their own. That said, this is probably a scam because they called you rather than your bank doing so. They cannot get your phone number from your account number: they have to know who you are and what your account number is. This is not as hard to do as it sounds since both your name and account number are prominently printed on your cheques and deposit books (possibly your phone number as well which saves them looking it up in the White Pages).\"" }, { "docid": "274422", "title": "", "text": "\"As this is anonymous, can you give us actual numbers? I can make guesses based on your percentages, but it would help. Lets assume you both make $35k (since you said child care would take up the bulk of your wife's income, it must be fairly low incomes) The answer usually isn't a simple \"\"do this\"\", but small adjustments in your lifestyle which add up. Church offering is 17%, the standard tithe is 10%. Lower it? It's the most obvious large non-required expense. Transportation is almost 10% of your income. If my numbers are right, that is somewhere around $500 per month? What kind of car/cars do you have? There are very cheap used cars which cost very little in upkeep / fuel. Is it possible your cars are more expensive than needed? My wife and I bought a used car for around $8k in cash a few years ago. Still running strong, only have done oil changes since then. Food is 12%, which would be perhaps $600 or $700 per month. That seems awfully high. Maybe I'm wrong about your salaries :) You said you were cheap, but now the numbers don't add up. Mortgage of 35% ($2k with escrow if I'm guessing on salaries right) seems reasonable. I'm assuming you don't want to downsize, particularly if you're going to have kids. Do you have a great mortgage rate? I assume you're on a 30 year fixed already?\"" }, { "docid": "527318", "title": "", "text": "Assuming you have registered your activities as partnership and receiving this money as Individual, you need to show this under Schedule OS, 1d [other income]. this will be under the ITR-2 [tab CG-OS] XLS tax preparation utility given by Tax Department. The XLS can be found at https://incometaxindiaefiling.gov.in/portal/individual_huf.do If the funds you are receiving are large [more than say Rs 500,000] then suggest you incorporate a partnership firm or company, there are quite a few exceptions you can claim lowering you tax outgo. The fact that you are transferring funds to your partners can be an issue incase you get audited. You would need to have sufficient evidence to show that the money paid was for services rendered directly and not your income. It would be easier if you create a partnership or have the client directly pay to them. Again if the sum is small its fine, as the sum becomes large, it would get noticed by the tax authorities." }, { "docid": "149341", "title": "", "text": "\"I'd recommend an online FX broker like XE Trade at xe.com. There are no fees charged by XE other than the spread on the FX conversion itself (which you'll pay anywhere). They have payment clearing facilities in several countries (including UK BACS) so provided you're dealing with a major currency it should be possible to transfer money \"\"free\"\" (of wire charges at least). The FX spread will be much better than you would get from a bank (since FX is their primary business). The additional risk you take on is settlement risk. XE will not pay the sterling amount to your UK bank account until they have received the Euro payment into their account. If XE went bankrupt before crediting your UK account, but after you've paid them your Euros - you could lose your money. XE is backed by Custom House, which is a large and established Canadian firm - so this risk is very small indeed. There are other choices out there too, UKForex is another that comes to mind - although XE's rates have been the best of those I've tried.\"" }, { "docid": "43046", "title": "", "text": "\"In answer to the \"\"how I can perform withdrawal with the lower rate (having GBP)?\"\" part of your question, as Joe stated you need to use another bank or currency exchange company to convert the GBP to PLN. Most of the UK banks charge similar amounts, and it's usually not possible to transfer the GBP to a foreign bank unless you have a GBP account with them. Some currency exchange firms are Transferwise, FairFX, CaxtonFX, a web search will show a fuller range. You could also use Paypal to do the transfer (if you have a paypal account) by transferring the GBP from Barclays to your paypal account and then from there to your PLN account.\"" }, { "docid": "537862", "title": "", "text": "ChelseaFC rocked number 2, so before I try to answer number 1, I'll just mention that academics generally ignored negative *real* interest rates, and have always admitted that negative *nominal* rates were perfectly possible. There's nothing in his explanation that I think is controversial at this point though. As for number 1, a drop in a company's share price affects the company's ability to raise cash in the present and future. In a closely related issue, that drop can affect the company's ability to compensate its employees through options and restricted stock grants. In the long run (and I suspect you already know this), and drop in the share price affects the shareholders' wealth, and can lead them to demand that changes be made to be firm's operations (usually, changes made to who's running the firm). If a firm doesn't need more financing, and it doesn't pay any employees with stock or derivatives on its stock, then changes to its stock price won't affect the firm's operations in the slightest. Naturally, this assuming that the change in stock prices isn't indicative of changes to the economy, but that's a causal relationship in the other direction (the stock price reflects changes in operations, not the other way around)." }, { "docid": "548211", "title": "", "text": "\"@jlowin's answer has a very good discussion of the types of PE ratio so I will just answer a very specific question from within your question: And who makes these estimates? Is it the market commentators or the company saying \"\"we'd expected to make this much\"\"? Future earnings estimates are made by professional analysts and analytical teams in the market based on a number of factors. If these analysts are within an investment company the investment company will use a frequently updated value of this estimate as the basis for their PE ratio. Some of these numbers for large or liquid firms may essentially be generated every time they want to look at the PE ratio, possibly many times a day. In my experience they take little notice of what the company says they expect to make as those are numbers that the board wants the market to see. Instead analysts use a mixture of economic data and forecasting, surveys of sentiment towards the company and its industry, and various related current events to build up an ongoing model of the company's finances. How sophisticated the model is is dependent upon how big the analytics team is and how much time resource they can devote to the company. For bigger firms with good investor relations teams and high liquidity or small, fast growing firms this can be a huge undertaking as they can see large rewards in putting the extra work in. The At least one analytics team at a large investment bank that I worked closely with even went as far as sending analysts out onto the streets some days to \"\"get a feeling for\"\" some companies' and industries' growth potential. Each analytics team or analyst only seems to make public its estimates a few times a year in spite of their being calculated internally as an ongoing process. The reason why they do this is simple; this analysis is worth a lot to their trading teams, asset managers and paying clients than the PR of releasing the data. Although these projections are \"\"good at time of release\"\" their value diminishes as time goes on, particularly if the firm launches new initiatives etc.. This is why weighting analyst forecasts based on this time variable makes for a better average. Most private individual investors use an average or time weighted average (on time since release) of these analyst estimates as the basis for their forward PE.\"" }, { "docid": "345533", "title": "", "text": "\"This answer is somewhat incomplete as I don't have definitive conclusions about some parts of your question. Your question includes some very specific subquestions that may best be answered by contacting the investment companies you're considering. I don't see any explicit statement of fees for TIAA-CREF either. I suggest you contact them and ask. There is mention on the site of no-transaction-fee funds (NTF), but I wasn't able to find a list of such funds. Again, you might have to ask. Vanguard also offers some non-Vanguard funds without transaction fees. If you go the Vanguard page on other mutual funds you can use the dropdown on the right to select other fund companies. Those with \"\"NTF\"\" by the name have no transaction fees. Scottrade also offers NTF funds. You can use their screener and select \"\"no load\"\" and \"\"no transaction fee\"\" as some of your filters. You are correct that you want to choose an option that will offer a good lineup of funds that you can buy without transaction fees. However, as the links above show, Vanguard and TIAA-CREF are not the only such options. My impression is that almost any firm that has their own funds will sell them (or at least some of them) to you without a transaction fee. Also, as shown above, many places will sell you other companies' funds for free too. You have plenty of options as far as free trades, so it really depends on what funds you like. If you google for IRA providers you will find more than you can shake a stick at. If you're interested in low-cost index funds, Vanguard is pretty clearly the leader in that area as their entire business is built around that concept. TIAA-CREF is another option, as is Fideltiy (which you didn't mention), and innumerable others. Realistically, though, you probably don't need a gigantic lineup of funds. If you're juggling money between more than a handful of funds, your investment scheme is probably needlessly complex. The standard advice is to decide on a broad allocation of money into different asset classes (e.g., US stocks, US bonds, international stocks, international bonds), find a place that offers funds in those areas with low fees and forget about all the other funds.\"" }, { "docid": "78486", "title": "", "text": "Given your clarifying points, it sounds like you are running both businesses as one combined business. As such, you should be able to get just a single HST number and use that. However, let me please urge you to contact a professional accountant and possibly a lawyer, as it is very unusual to be performing these services without a business license, and you may be exposing yourself to civil penalties and placing your personal assets (e.g. your house) at risk. Additionally, it may be beneficial for you to run these as businesses as you can likely write off (more of) your expenses." } ]

[ { "docid": "393152", "title": "", "text": "Well, these can range from loan broker to outright scams. It is pretty typical that loan broker just take some fee in the middle for their service of filling your applications for a bunch of real loan provider companies. Because making a web page costs nothing, a single loan broker could easily have many web pages with a bit different marketing so that they can get as many customers as possible. But of course some of the web pages can be actual scams. As soon as you provide enough information for taking out a loan, they can go to a real financial institution, take out the loan and run with the money. In most countries consumer protection laws do not apply to business-to-business transactions, so you have to be even more wary of scams than usual." } ]

[ { "docid": "426506", "title": "", "text": "\"I actually interviewed to work at the SEC as an \"\"industry transplant.\"\" I was surprised to learn the limits of the SEC's power - namely, they cannot compel anybody to show them any documents - even ones financial firms are required to hold. When firms do \"\"cooperate,\"\" they tend to make it as difficult as possible for investigators. All the SEC can do in the end is sue the firm, and that's a long drawn out process (I understand now why there are so many settlements). What I learned, however, is that the SEC needs more people like myself who have worked in the business. Most people who interviewed me were attorneys and (sometimes) accountants. Their experience in the financial industry was limited to working at legal firms who did financial advisory work. Many simply don't even know what to look for. I'm still waiting to hear back, but there are a lot of lawyers who are sick of working industry jobs and would love the pay and work environment of the SEC - so it's tough to get a position there.\"" }, { "docid": "512381", "title": "", "text": "\"&gt; can I use venture like that in a financial context, or does it refer specifically to venture capital? Yes, any business is a \"\"venture\"\" so to speak. &gt; so they would receive a smaller return, yes? POSSIBLY yes. Mezzanine investors are, well, \"\"middle\"\" investors. They're beyond seed and venture capital, but before more \"\"late-stage\"\" private investment. That doesn't *necessarily* mean they're \"\"after a seed or venture capital investment.\"\" It can mean that, or it can simply mean the business is a little more advanced than a pure idea, or pre-revenue, etc. Let's say a company is pre-destined to get to $100m in value IF it can secure funding. Naturally, later investors will have a smaller return. Of course, private investments are generally for smaller, younger companies, and thus are more risky, so an investor can still *lose* value in a private equity investment. &gt; Is mezzanine investing particularly profitable? Yes, absolutely. You have to understand, with investments in private equity, firms and individuals are often looking for a *multiple* of their investment (i.e. if an investor invests $1m, they expect $2m, $3m, etc. back). This is not necessarily for all levels of private equity, but many levels will attempt this. Generally the idea (as far as I'm aware) is a 20% IRR (which means that generally, the investment grows by 20% *compounding* yearly). &gt; Secondly, why is dilution so important further down the road? Is it to do with valuation? Absolutely. Let's think of our example earlier, where you, me, and Joe each own 33% at $300 total value. If suddenly another company wants to buy ALL of our equity for $600, then we're all pretty happy. Each of us will get $200. HOWEVER, let's say Joe hadn't come along. If that other company *then* made an offer for $600, we'd both get *$300* for the company. There's some other things about dilution too, such as the possible loss of control, but we'll save that for later. &gt; Finally, at what point would a company aim to meet an IPO? Is it case specific, or is there a general understanding of the \"\"best time\"\"? It's VERY case specific. In *most* cases, depending on the industry, the company will be relatively a bit older, have both revenue and profitability, and a history of operations. In some cases, companies like this will choose to *never* go IPO (such as the Big 4 auditing firms, for one, among others). There are, of course, exceptions. Many smaller pharmacueticals are *pre-revenue* and are traded on the market. Tesla is getting revenue, but *not profitable* and it's on the markets as well. These are, naturally, riskier investments, but at least you've got liquidity to help a bit with that. When a private equity (PE) firm is looking to exit (sell their stake) through an IPO, they will try to engineer the company to be as attractive as possible to public investors. In fact, many PE firms will stipulate specific terms, and possibly get control of the company from the owner, when they initially invest. But there's a lot that goes into it. Perhaps /u/wreckingcru or /u/Seraphinic can go into a bit more detail on PE exits as while it's my chief interest and my career goal, it's not quite where I'm at *yet.*\"" }, { "docid": "521835", "title": "", "text": "it depends on the area you want to focus in. to be sure, i will say that pretty much all certificates in finance can be achieved online now. CFP is a pretty ok one. i have it myself. there is quite a bit of material, but isn't too challenging. it focuses on financial planning/personal finance. certainly aids your technical knowledge but is kind of an analog to help boost your sales. most pure planners i know have this but moreover a series of more technical designations. you must have a bachelors to be given the right to use the CFP. CFA is a great one for your resume (and knowledge), but makes the CFP look like a summer vacation. it is for analysis, but has a broad range of potential uses. i know brokers, advisors, planners, and people leaders with these marks. if you are very smart, it will take you a minimum of 2.5 years (really 3yr) to complete due to their testing schedule. they also grade on a very steep curve. from what i understand, the amount of information and level of command you must demonstrate also necessitate this lengthy schedule. beyond that, you can look at getting FINRA licensed in a desired area (e.g. series 7/63 to be a broker). i would caution against this, unless you are very sure of where you want to go or need to meet the requirement for a job. typically jobs with license requirements will permit you 3-6 months to obtain them on company money. you risk spending a good bit of money that won't be reimbursed by getting licensed independently. keep in mind that you cannot actually use your licenses without a firm sponsor. finally, there are a variety of specialized designations like CWS and CMT that i would also caution against unless sure of desired position or meeting job requirements. it is better, in my opinion, to find yourself in a place where getting these will better position you for your current job rather than wasting time on them and finding yourself in a place where they hold no water." }, { "docid": "118485", "title": "", "text": "\"There are a couple of misconceptions I think are present here: Firstly, when people say \"\"interest\"\", usually that implies a lower-risk investment, like a government bond or a money market fund. Some interest-earning investments can be higher risk (like junk bonds offered by near-bankrupt companies), but for the most part, stocks are higher risk. With higher risk comes higher reward, but obviously also the chance for a bad year. A \"\"bad year\"\" can mean your fund actually goes down in value, because the companies you are invested in do poorly. So calling all value increases \"\"interest\"\" is not the correct way to think about things. Secondly, remember that \"\"Roth IRA fund\"\" doesn't really tell you what's \"\"inside\"\" it. You could set up your fund to include only low-risk interest earning investments, or higher risk foreign stocks. From what you've said, your fund is a \"\"target retirement date\"\"-type fund. This typically means that it is a mix of stocks and bonds, weighted higher to bonds if you are older (on the theory of minimizing risk near retirement), and higher to stocks if you are younger (on the theory of accepting risk for higher average returns when you have time to overcome losses). What this means is that assuming you're young and the fund you have is typical, you probably have ~50%+ of your money invested in stocks. Stocks don't pay interest, they give you value in two ways: they pay you dividends, and the companies that they are a share of increase in value (remember that a stock is literally a small % ownership of the company). So the value increase you see as the increase due to the increase in the mutual fund's share price, is part of the total \"\"interest\"\" amount you were expecting. Finally, if you are reading about \"\"standard growth\"\" of an account using a given amount of contributions, someone somewhere is making an assumption about how much \"\"growth\"\" actually happens. Either you entered a number in the calculator (\"\"How much do you expect growth to be per year?\"\") or it made an assumption by default (probably something like 7% growth per year - I haven't checked the math on your number to see what the growth rate they used was). These types of assumptions can be helpful for general retirement planning, but they are not \"\"rules\"\" that your investments are required by law to follow. If you invest in something with risk, your return may be less than expected.\"" }, { "docid": "126743", "title": "", "text": "\"Most answers have concentrated on this being a scam, however, it is possible this is an innocent mistake. Australian bank account numbers do not have redundant digits to be used to validate an account number; all of the numbers are data and uniquely identify a bank and branch (the BSB number) and an account (the Account number). Computer check digits are not part of bank account numbers because bank account numbers pre-date computers. It is entirely possible that someone entering an incorrect number can, by chance, hit upon an existing account. As the bank clearance system in Australia is entirely automatic there is no cross-checking of account numbers with account names. Internet banking in Australia is not a wire-transfer as is common in places like the USA (although these can be done): here you are effectively accessing your bank's \"\"back office\"\". Nor is it like the BPay service which is used primarily by B to C businesses as a way for their customers to pay their bills; when using this service the biller code will show you who you are paying and the customer number does have check digit validation. I run a business in Australia and it has happened to us on several occasions than an employee or supplier has given us incorrect numbers. Usually, it is not a real account and after a week or so the money makes its way back to us with a message like NO ACCOUNT or A/C CLOSED. Very occasionally, however, the wrong number hits a live account: when that happens the person who f*&ked up needs to contact their bank and try and get the transaction reversed. If there is money in the destination account this usually happens with little fuss, however, if the destination account has been closed or emptied things get problematic. Of course, taking money that isn't yours is stealing even if it happens to be sitting in your bank account. However, unless the sum involved is significant the police are usually not interested in diverting their attention away from \"\"serious\"\" crimes like homicide, armed robbery and terrorism so the aggrieved party is usually on their own. That said, this is probably a scam because they called you rather than your bank doing so. They cannot get your phone number from your account number: they have to know who you are and what your account number is. This is not as hard to do as it sounds since both your name and account number are prominently printed on your cheques and deposit books (possibly your phone number as well which saves them looking it up in the White Pages).\"" }, { "docid": "351059", "title": "", "text": "\"For starters like some other people have said, just talk to someone in IB and get some advice on how to break in, and what it's really like. I've spoken to people in IB and learned that it's really just not going to be for me...In response to your four questions, 1. Get your degree at DePaul and wait a few years to get your masters. You don't need an MBA for IB and it'll be a lot harder to go to a prestigious grad school without significant work experience and a solid network 1. It definitely wouldn't hurt for you to double major in CS, but if you do, you're going to have to keep your grades up, and still stay sharp in both majors. You don't want to have a 3.0 and have both, it'll kill your chances. You're going to need at LEAST a 3.8, if you're under that it's gonna be a lot harder to get anywhere. 1. If there are other industries you want to turn to then sure! I used to be interested in IB but now I'm leaning more towards private equity, and working with Reg D. clients, 1031 exchanges etc. 1. NETWORK!!!! If you aren't already, seriously get out there and network like hell. But don't just cold call random people, you really need to make meaningful connections with people, and continue to stay in contact with them. You can also learn a lot from WSO and various IB books, guides etc, I have a bunch of that stuff on my google drive from a friend if you want it. And some general tidbits **Don't stress about the school you go to**...going to a prestigious school really does help, but if you work hard enough, make the right connections and are good at what you do, you can land a role in IB. I know several people that have gone into IB from my school and I would consider us maybe a Grade C state school. It's possible I'd also recommend looking more at a boutique and middle-mark companies rather than your Bulge Bracket banks, it'll have less competition and could be easier to break into, and like some other people are said you really need to get that junior year internship if you want to make it into IB. But if you can't get into IB right after school don't fret, go somewhere, get some experience, get your certifications (Series 7, Series 63 etc) and try again. **Know your technicals** you need to be able to walk through a DCF, an LBO and all of the financial statements in an interview. There are billions of guides on how to do this, but you need to know this. **Stay on top of current events** Just be well versed in how the market is doing, which industries are hot right now and what's not, and WHY! **Know your story** Believe it or not, but your story and how that aligns with a companies culture is really important. I have a friend that didn't make it into a certain firm solely because they just didn't think he was a good enough fit for their culture. \"\"I want to make a lot of money\"\" won't work, instead think more along the lines of \"\"I want to challenge myself\"\" Good luck man\"" }, { "docid": "105011", "title": "", "text": "What is my best bet with the 401K? I know very little about retirement plans and don't plan to ever touch this money until I retire but could this money be of better use somewhere else? You can roll over a 401k into an IRA. This lets you invest in other funds and stocks that were not available with your 401k plan. Fidelity and Vanguard are 2 huge companies that offer a number of investment opportunities. When I left an employer that had the 401k plan with Fidelity, I was able to rollover the investments and leave them in the existing mutual funds (several of the funds have been closed to new investors for years). Usually, when leaving an employer, I have the funds transferred directly to the place my IRA is at - this avoids tax penalties and potential pitfalls. The student loans.... pay them off in one shot? If the interest is higher than you could earn in a savings account, then it is smarter to pay them off at once. My student loans are 1.8%, so I can earn more money in my mutual funds. I'm suspicious and think something hinky is going to happen with the fiscal cliff negotiations, so I'm going to be paying off my student loans in early 2013. Disclaimer: I have IRA accounts with both Fidelity and Vanguard. My current 401k plan is with Vanguard." }, { "docid": "19618", "title": "", "text": "It depends on the currency pair since it is much harder to move a liquid market like Fiber (EURUSD) or Cable (GBPUSD) than it is to move illiquid markets such as USDTRY, however, it will mostly be big banks and big hedge funds adjusting their positions or speculating (not just on the currency or market making but also speculating in foreign instruments). I once was involved in a one-off USD 56 million FX trade without which the hedge fund could not trade as its subscriptions were in a different currency to the fund currency. Although it was big by their standards it was small compared with the volumes we expected from other clients. Governments and big companies who need to pay costs in a foreign currency or receive income in one will also do this but less frequently and will almost always do this through a nominated bank (in the case of large firms). Because they need the foreign currency immediately; if you've ever tried to pay a bill in the US denominated in Dollars using Euros you'll know that they aren't widely accepted. So if I need to pay a large bill to a supplier in Dollars and all I have is Euros I may move the market. Similarly if I am trying to buy a large number of shares in a US company and all I have is Euros I'll lose the opportunity." }, { "docid": "246586", "title": "", "text": "Brokerage firms are required to report the number of shares being shorted. This information is reported to the exchange (NYSE of NASDAQ) and is made public. Most financial sites indicate the number of shares being shorted for a particular stock. The image below from Yahoo finance shows 3.29 million shares of CMG were being shorted at the close of 9-28-2012. This is over 12% of the total outstanding shares of CMG. For naked short selling additional information is tracked. If the brokerage is unable to borrow shares to deliver before the settlement date of a short sale then the transaction is recorded as fails-to-deliver. No money or shares are exchanged since the brokerage is unable to deliver the shares that were agreed upon. A large amount of fails-to-deliver transactions for a stock usually indicates an excessive amount of naked shorting. When investors and brokerage firms start to aggressively short a stock they will do so without having borrowed the shares to sell. This will result in a large amount of naked short selling. When there are a large number of naked short sellers not all the sellers will be able to borrow the necessary shares before the settlement date and many fails-to-deliver transactions will be recorded. The SEC records the number of fails-to-deliver transactions. The table below summarizes the fails-to-deliver transactions from 1-1-2012 through 9-14-2012 (data obtained from here). The “Ext Amount” column shows the total dollar value of the transactions that failed ( i.e. Fail Qty * Share price ). The “Volume” column is the total number of shares traded in the same time period. The “% Volume” shows the percentage of shares that failed to deliver as a percentage of the total market volume. The table orders the data in descending order by the quantity of shares that were not delivered. Most of the companies at the top of the list no longer exist. For many of these companies, the quantity of shares that failed to deliver where many multiples of the number of shares traded during the same time period. This indicates massive naked short selling as many brokerages where unable to find shares to borrow before the settlement date. More information here." }, { "docid": "198871", "title": "", "text": "\"Even less reason for influencers to tag it then? The way it works for us is our PR company pretty much gives us a list of their affiliate \"\"Key Opinion Leaders\"\" (KOL) with all of their rates. We then choose a couple after looking at their pages. PR firm sends out product samples then lets us know when the post is up. PR firm pays KOL, we pay PR firm. So for this to come up as \"\"advertised\"\" on insta, my understanding from the above thread is that the KOL needs to tag it. However as the client we would absolutely not want \"\"Paid\"\" or \"\"Sponsored\"\" to show up if we can help it, it destroys the illusion. Last thing I will note is what /u/pwnicholson posted about regarding FTC rules. That is fine if you need to tag it for regulatory reasons. We don't in Aus, so it won't happen. In saying that, the data looks juicy so we'd probably do it here and there to see the numbers, but otherwise the 'illusion' is very important imo.\"" }, { "docid": "404339", "title": "", "text": "I was wondering what relations are between brokerage companies and exchanges? Are brokers representing investors to trade on exchanges? Yes...but a broker may also buy and sell stocks for his own account. This is called broker-delaer firm. For individual investors, what are some cons and pros of trading on the exchanges directly versus indirectly via brokers? Doesn't the former save the investors any costs/expenses paid to the brokers? Yes, but to trade directly on an exchange, you need to register with them. That costs money and only a limited number of people can register I believe. Note that some (or all?) exchanges have their websites where I think trading can be done electronically, such as NASDAQ and BATS? Can almost all stocks be found and traded on almost every exchange? In other words, is it possible that a popular stock can only be found and traded on one exchange, but not found on the other exchange? If needed to be more specific, I am particularly interested in the U.S. case,and for example, Apple's stock. Yes, it is very much possible with smaller companies. Big companies are usually on multiple exchanges. What are your advices for choosing exchange and choosing brokerage companies? What exchanges and brokerage companies do you recommend? For brokerage companies, a beginner can go with discount broker. For sophisticated investors can opt for full service brokers. Usually your bank will have a brokerage firm. For exchanges, it depends...if you are in US, you should send to the US exchanges. IF you wish to send to other exchanges in other countries, you should check with the broker about that." }, { "docid": "220486", "title": "", "text": "\"You cannot actually buy an index in the true sense of the word. An index is created and maintained by a company like Standard and Poor's who licenses the use of the index to firms like Vanguard. The S&P 500 is an example of an index. The S&P 500 \"\"index includes 500 leading companies\"\", many finical companies sell products which track to this index. The two most popular products which track to indexes are Mutual Funds (as called Index Funds and Index Mutual Funds) and Exchange Traded Funds (as called ETFs). Each Index Mutual Fund or ETF has an index which it tracks against, meaning they hold securities which make up a sample of the index (some indexes like bond indexes are very hard to hold everything that makes them up). Looking at the Vanguard S&P 500 Index Mutual Fund (ticker VFINX) we see that it tracks against the S&P 500 index. Looking at its holdings we see the 500-ish stocks that it holds along with a small amount of bonds and cash to handle cash flow for people buying and sell shares. If we look at the Vanguard S&P 500 ETF (ticker VOO) we see that it also tracks against the S&P 500 index. Looking at its holdings we see they are very similar to the similar Index Mutual Fund. Other companies like T. Rowe Price have similar offering. Look at the T. Rowe Price Equity Index 500 Fund (ticker PREIX) its holdings in stocks are the same as the similar Vanguard fund and like the Vanguard fund it also holds a small amount of bonds and cash to handle cash flow. The only real difference between different products which track against the same index is in the expense ratio (fees for managing the fund) and in the small differences in the execution of the funds. For the most part execution of the funds do not really matter to most people (it has a very small effect), what matters is the expense (the fees paid to own the fund). If we just compare the expense ratio of the Vanguard and T. Rowe Price funds we see (as of 27 Feb 2016) Vanguard has an expense ratio of 0.17% for it Index Mutual Fund and 0.05% for its ETF, while T. Rowe Price has an expense ratio of 0.27%. These are just the fees for the funds themselves, there are also account maintenance fees (which normally go down as the amount of money you have invested at a firm go up) and in the case of ETFs execution cost (cost to trade the shares along with the difference between the bid and ask on the shares). If you are just starting out I would say going with the Index Mutual Fund would easier and most likely would cost less over-all if you are buying a small amount of shares every month. When choosing a company look at the expense ratio on the funds and the account maintenance fees (along with the account minimals). Vanguard is well known for having low fees and they in fact were the first to offer Index Mutual Funds. For more info on the S&P 500 index see also this Investopedia entry on the S&P 500 index. Do not worry if this is all a bit confusing it is to most people (myself included) at first.\"" }, { "docid": "277498", "title": "", "text": "\"&gt; That is in large part do to insane healthcare costs passed on to the consumers by the aca. Healthcare spending has increased on average 1.5% annually since 2009 where as the highest growth in spending from 1991 until 2006 was 1.3% Health Care costs have actually been on the rise for decades now. It was only \"\"noticed\"\" by the majority party (i.e. the GOP who had held the majority for 16 of the years prior to 2009) when the ACA was enacted. Suddenly, health care costs \"\"started\"\" to \"\"explode\"\". The truth is that health care costs have been on a steady rise. In the time period from 1972 to 1982, costs rose on [average 14% per year](https://www.thebalance.com/causes-of-rising-healthcare-costs-4064878). Keep in mind, this was prior to the expansion of Medicare. From 1983-1992 costs grew at a rate of 9% per year - 3 times faster than inflation. From 1993 to 2010, cost rose at a rate of 6.4% per year. The ACA of course was passed in 2009, but didn't start to take effect until 2011. Since 2010, health care costs has risen about 4% per year. That is a 2% drop in a short amount of time, compared to the previous years. However, the numbers are already so big, just like the national debt, that the GOP (who had as much part to play in the health care costs as they did in the debt) had tons of numbers they could use to make it seem like \"\"health care costs have exploded\"\". In reality, what happened is that people who never had health insurance before were forced to get it, and started to realize how expensive it is when it actually covers what it was intended to cover - preventative care as well as emergent care. The GOP has been on a steady march to undermine the new law as much as possible since it passed, because it made some of their biggest donors (HMOs, and Health Care Insurance providers) uncomfortable the fact that they HAD to share their cost information, and that the health care exchange required them to do a line item by line item comparison with other companies out there. So, here we are. The ACA is going to be cut, and millions of people are going back to be uninsured or underinsured. What you are going to see is the rate of costs growth start to increase again after decades of slowly decreasing rates. Why? Because of the renewed ability of insurance providers to hide the costs, to hide costs increases. It will also cause hospitals to greatly overcharge the uninsured, as they were doing before, but there will be many more of them. The goal being, that the uninsured are unlikely to pay for the (very large) medical bills. So, knowing this, hospitals artificially inflate the bill in the hopes of getting a larger portion of that unpaid bill liquidated through Medicare. Uninsured populations also lead to more unhealthy people. You would think that not having health insurance would make people want to remain more healthy. However, studies show [the opposite to be true](http://www.slate.com/articles/business/the_dismal_science/2011/07/does_health_coverage_make_people_healthier.html). In actuality, people stress more about their health, and avoid periodic checkups. Both of which lead to bad health results. Trying to blame the cost increases in health care on government \"\"meddling\"\", or say it is a problem brought on by the ACA is weird since there are [so many examples of government provided](https://www.forbes.com/sites/danmunro/2014/06/16/u-s-healthcare-ranked-dead-last-compared-to-10-other-countries/#175cf39e576f) health care programs out there which are so much more efficient, less costly, and have resulted in much healthier populations. &gt; I dont have health insurance and an ER visit with xrays costs me less out of pocket than 90% of the country why is that? I am going to call BS. Number one, that is a huge claim to make without supporting evidence. Number two, you would have to demonstrate how much that same visit would cost to those *with* health insurance. &gt; Do you think it has to do with the fact that with the aca hospitals know they are getting paid with 0 questioning on pricing so charge whatever they want and with me they think \"\"shit this guy might not ever pay us lets just give him a decent price and get some money from him because all we can do is send his bill to collections\"\" Actually, no. The [exact *opposite* happens](http://www.alternet.org/story/16466/why_hospitals_overcharge_the_uninsured). They now, because you are uninsured, that you are unlikely to pay. So they *overcharge* you for the same services because they know that they will only be reimbursed a percentage of the costs if it goes to Medicare for non-payment. &gt; The swiss do everything better, You keep referring back to Switzerland. Don't get me wrong, they are a very good country, and have the number 2 ranked health care system in the world. However, I don't think they are the low tax haven that you think they are. They have an [average corporate tax rate of 17.2%](https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates), whereas the US has it at 32%. Their highest income tax bracket is 13.2, whereas the US is at 39%. Their sales tax goes at high as 8%, where ours go as high as 11%. Their [average effective tax](http://www.economist.com/node/14340551) rate is around 11%, while ours is around 18%. Including Social Security puts Switzerland at 17%, and the US at 24%. So, they are definitely a lower tax rate country, but in no way are they a no tax rate country. Then again, Switzerland has no military to speak of, while the US spends more on military then the next 7 countries put together. &gt; This is the dumbest statement youve made this entire time. I have been very patient. I have stuck with this conversation, in spite of the put downs and snide remarks. I have jabbed a little too, but you can go back to most of my remarks and see that I have been more congenial. I have given you some leeway because of your age, and I am almost twice as old as you. So, you gave me your background. I will give you mine. I am closer to 50 then I would prefer. I left the house at 17, enlisted in the Navy, and spent the next 15 years serving in the military. I ended my career in a select community. I have been out for ten years this July. I am now owner of a company that does R&amp;D and works with the government. A lot of my knowledge about inventions, and how commercial works with government comes from my own personal experiences. I have seen the best, and worst, of government - as well as seen the same on the commercial side of the house. Anyone comes to this game with the presupposition that government can't get anything done as well as commercial quickly learns that is not true. Likeways, anyone comes thinking that commercial equals efficient learns *that* is not always true too. &gt; Take apple for instance where is all the government funding they recieved to be one of the most innovative companies in human history or microsoft? As I said previously, that you thought was a \"\"dumb\"\" comment - commercial is very good at taking existing systems and finding ways to make them efficient and better. Apple and Microsoft is the same. They both made their mark in history by expanding on and creating innovation with existing technologies that had their foundation in government R&amp;D projects - including the [digital computer](https://en.wikipedia.org/wiki/John_Vincent_Atanasoff), as well as computers like the [ENIAC and the UNIVAC](https://www.computerhope.com/issues/ch000984.htm), and the advancements into [microsecond multitasking](https://arstechnica.com/tech-policy/2011/06/did-ibm-invent-the-personal-computer-answer-no/) which lead to the first efficient and cost effective personal computers. The touchscreen was actually first invented in by [engineers at CERN](https://en.wikipedia.org/wiki/Touchscreen#History). And of course, we know that the [internet started as a government funded project called ARPANET](http://www.history.com/news/ask-history/who-invented-the-internet). I think you would be surprised how much many if not most of the things we take for granted today have a foundation in government funded R&amp;D. My company is a commercial company, and we do a great job creating our own products and innovation. And yet still, our best selling product is a design of a national laboratory that we license from them. Commercial industry is great at manufacturing and producing, something the government is not as good at, and so often they will license out designs for production to companies like ours. Some of the biggest commercial companies out there do the same.\"" }, { "docid": "529731", "title": "", "text": "There is no limit on how much money you can bring into the USA, in Cash or through electronic transfer. You only need to be able to proof or convincingly show that you earned it legally and paid all potential US taxes that you had to pay. If you chose to bring it in cash, you need to tell customs when arriving (and again, be prepared to proof the legal sources). Wire transfer, cash in the suitcase, whatever you like. There is no tax for bringing the money, and the tax for making that money supposedly is already paid. Once the money is in the US, and earns more money, you will owe taxes on the gain (not on the capital itself, just on the amounts it increases by) I hope you understand that if you live in the US, and you have money anywhere in the world, you might need to report it to the IRS; and if your money makes interest anywhere in the world (including of course in India), you might be are required to pay US taxes on the gains. That is independent of your question; but if you don't do it, you are cheating the IRS, and they will ask this when you bring the money back." }, { "docid": "158629", "title": "", "text": "\"Just an FYI, this can be a risky move. Unless you have been in the industry for a while, or are extremely well averse in investment management/research, keep it pretty short. In a lot of ways, you might want to think about tailoring it more like a sell-side report. Also, make sure you understand the style of investing the PM/company you are applying to likes. The reason I say this is because every buy-side shop is different. Some do 1-2 page write-ups with models and walk through's, others will expect 60 page \"\"decks\"\" (i.e. Powerpoints). The longer the deck, the more you have that can go wrong. If one tiny thing is wrong, or you have a typo anywhere, it hurts you more than it helps that you wrote something long (I once had the wrong rating on one issuance of a bond ladder I was pitching; it's all the PM's focused on). The more important aspect is that you understand the shop you are applying to and then tailoring the pitch to them. For example, don't do a growth tech company with an 80x forward P/E if you're applying to a fundamental value shop. It shows you didn't do research on the firm you're applying to and that you won't fit the culture. This is part of why I was saying that this can be a risky move, if the firm is large enough to have an HR department, they likely have a lot of different investment styles in house. Finally, try to keep it to a small/mid-cap company. Analysts/PMs follow stocks all day long and will most likely have an opinion on 99% of large caps, no matter the sector. In summary, I'd recommend a 1-2 page sell-side style write-up with a backup model (printed excel file). KISS (keep it simple stupid), have a summary, couple years worth of historical's, 2 years forward, and a few main bullet points of why you like them. In your case, this pitch should be something to pique the interest so that you can NAIL a real pitch in the interview. If you get an interview, know everything about everything in the industry as well as that specific company. For example, lets say you do a smartphone secular theme investment. Do you know what outstanding AAPL/Android cases there are, and more importantly, how would each ruling likely affect the marketplace? This is because I can guarantee if you're pitching to another tech guy, he knows and has an educated opinion on it. Also, in many cases having a great model can mean more than a long write-up, it shows that you're good with numbers and can think about FUTURE earnings, which are all that matter. Last point, IMO you'd be better off trying to get your foot in the door through networking than HR. HR doesn't really do much on the buy-side with recruiting and won't really understand what to look for in a good pitch (they're HR after-all, not an analyst). Try to meet someone over coffee and then have a pitch READY to bring out/discuss. The buy-side is selective enough that usually when positions open up it's either because they are creating one for you or they already have an idea of who is going to fill it. This mean HR has little to no say in helping you get in. You'll have a lot more success this way than blasting to a bunch of HR emails.\"" }, { "docid": "458376", "title": "", "text": "There would be a catastrophic collapse in the financial industry. Not exaggerating. Every bank is a company that's technically held by another company, a bank holding company. Every investment firm typically has anywhere from dozens to thousands of separate little companies (depending on the size of the overall firm) that it uses to manage money and risk. There's ways to try and solve agency problems and moral hazard problems in corporate governance, but disallowing corporations from creating wholly owned subsidiaries is not the way to do it." }, { "docid": "443094", "title": "", "text": "\"In addition to the possibility of buying gold ETFs or tradable certificates, there are also firms specializing in providing \"\"bank accounts\"\" of sorts which are denominated in units of weight of precious metal. While these usually charge some fees, they do meet your criteria of being able to buy and sell precious metals without needing to store them yourself; also, these fees are likely lower than similar storage arranged by yourself. Depending on the specifics, they may also make buying small amounts practical (buying small amounts of physical precious metals usually comes with a large mark-up over the spot price, sometimes to the tune of a 50% or so immediate loss if you buy and then immediately sell). Do note that, as pointed out by John Bensin, buying gold gets you an amount of metal, the local currency value of which will vary over time, sometimes wildly, so it is not the same thing as depositing the original amount of money in a bank account. Since 2006, the price of an ounce (about 31.1 grams) of gold has gone from under $500 US to over $1800 US to under $1100 US. Few other investment classes are anywhere near this volatile. If you are interested in this type of service, you might want to check out BitGold (not the same thing at all as Bitcoin) or GoldMoney. (I am not affiliated with either.) Make sure to do your research thoroughly as these may or may not be covered by the same regulations as regular banks, particularly if you choose a company based outside of or a storage location outside of your own country.\"" }, { "docid": "544578", "title": "", "text": "In my experience thanks to algorithmic trading the variation of the spread and the range of trading straight after a major data release will be as random as possible, since we live in an age that if some pattern existed at these times HFT firms would take out any opportunity within nanoseconds. Remember that some firms write algorithms to predict other algorithms, and it is at times like those that this strategy would be most effective. With regards to my own trading experience I have seen orders fill almost €400 per contract outside of the quoted range, but this is only in the most volatile market conditions. Generally speaking, event investing around numbers like these are only for top wall street firms that can use co-location servers and get a ping time to the exchange of less than 5ms. Also, after a data release the market can surge/plummet in either direction, only to recover almost instantly and take out any stops that were in its path. So generally, I would say that slippage is extremely unpredictable in these cases( because it is an advantage to HFT firms to make it so ) and stop-loss orders will only provide limited protection. There is stop-limit orders( which allow you to specify a price limit that is acceptable ) on some markets and as far as I know InteractiveBrokers provide a guaranteed stop-loss fill( For a price of course ) that could be worth looking at, personally I dont use IB. I hope this answer provides some helpful information, and generally speaking, super-short term investing is for algorithms." }, { "docid": "192366", "title": "", "text": "The idea is to positively identify you with properly issued government ID. If you show up with your passport, visa, and another form of government-issued identification which the banker can recognize and use (for example - international driver's license, a US-State driver's license, EU internal ID, etc) - it will be quick and painless. Usually, at least two distinct forms of identification are required from foreigners: passport and something else, and not the visa stamped in a passport, that just shoes to show your status upon your W9/W8 requirements may be based. You'll probably be asked for a TIN before any payments are made to you by the bank. If you don't have anything credible to show as your identification it will be equally quick and painless, except that you'd be leaving without a bank account. If your identity cannot be established properly there and then - they will not serve you." } ]

[ { "docid": "167494", "title": "", "text": "\"I'm not an accountant, and you should probably get the advice of one to be sure about what to do. However, if the business is a sole-proprietorship, you'd complete a Schedule C for the business, and you'd end up with a loss at the end. If the investment you made in the business is considered to be entirely or partially \"\"at risk\"\" per the IRS definition, you'd get to claim all or part of the loss as a reduction in your income. If the business was an LLC, then you're beyond my already limited knowledge. There may be some other considerations based on whether this was really a business vs a hobby, and whether or not you're going to try to continue with the business, or whether you've shut it down. I'm not sure about those parts, but they'd be worth exploring with an accountant.\"" } ]

[ { "docid": "202645", "title": "", "text": "For stocks, bonds, ETF funds and so on - Taxed only on realised gain and losses are deductible from the gain and not from company's income. Corporate tax is calculated only after all expenses have been deducted. Not the other way around. Real estate expenses can be deducted because of repairs and maintenance. In general all expenses related to the operation of the business can be deducted. But you cannot use expenses as willy nilly, as you assume. You cannot deduct your subscription to Playboy as an expense. Doing it is illegal and if caught, the tours to church will increase exponentially. VAT is only paid if you claim VAT on your invoices. Your situation seems quite complicated. I would suggest, get an accountant pronto. There are nuances in your situation, which an accountant only can understand and help." }, { "docid": "130631", "title": "", "text": "\"In the US you are not required to have a corporation to use business expenses to offset your income. The technical term you need is \"\"deducting business expenses\"\", and in matters of taxes it's usually best to go straight to the horse's mouth: the IRS's explanations Deducting Business Expenses Business expenses are the cost of carrying on a trade or business. These expenses are usually deductible if the business operates to make a profit. What Can I Deduct? Cost of Goods Sold, Capital Expenses, Personal versus Business Expenses, Business Use of Your Home, Business Use of Your Car, Other Types of Business Expenses None of this requires any special incorporation or tax arrangements, and are a normal part of operating a business. However, there is a bit of a problem with your scenario. You said you \"\"invested\"\" into a business, but you mentioned buying specific things for the business which is not generally how one accounts for investment. If you are not an owner/operator of the business, then the scenario is not so straight-forward, as you can't simply claim someone else's business expenses as your own because you invested in it. Investments are taxed differently than expenses, and based upon your word choices I'm concerned that you could be getting yourself into a bit of a pickle. I would strongly advise you to speak with a professional, such as a Certified Public Accountant (CPA), to go over your current arrangement and advise you on how you should be structuring your ongoing investment into this shared business. If you are investing you should be receiving equity to reflect your ownership (or stock in the company, etc), and investments of this sort generally cannot be deducted as an expense on your taxes - it's just an investment, the same as buying stock or CDs. If you are just buying things for someone else's benefit, it's possible that this could be looked upon as a personal gift, and you may be in a precarious legal position as well (where the money is, indeed, just a gift). And gifts of this sort aren't deductible, either. Depending on how this is all structured, it's possible that you should both consider a different form of legal organization, such as a formal corporation or at least an official business partnership. A CPA and an appropriate business attorney should be able to advise you for a nominal (few hundred dollars, at most) fee. If a new legal structure is advisable, you can potentially do the work yourself for a few hundred dollars, or pay to have it done (especially if the situation is more complex) for a few hundred to a few thousand. That's a lot less than you'd be on the hook for if this business is being accounted for improperly, or if either of your tax returns are being reported improperly!\"" }, { "docid": "141738", "title": "", "text": "\"About deducting mortgage interest: No, you can not deduct it unless it is qualified mortgage interest. \"\"Qualified mortgage interest is interest and points you pay on a loan secured by your main home or a second home.\"\" (Tax Topic 505). According to the IRS, \"\"if you rent out the residence, you must use it for more than 14 days or more than 10% of the number of days you rent it out, whichever is longer.\"\" Regarding being taxed on income received from the property, if you claim the foreign tax credit you will not be double taxed. According to the IRS, \"\"The foreign tax credit intends to reduce the double tax burden that would otherwise arise when foreign source income is taxed by both the United States and the foreign country from which the income is derived.\"\" (from IRS Topic 856 - Foreign Tax Credit) About property taxes: From my understanding, these cannot be claimed for the foreign tax credit but can be deducted as business expenses. There are various exceptions and stipulations based on your circumstance, so you need to read the official publications and get professional tax advice. Here's an excerpt from Publication 856 - Foreign Tax Credit for Individuals: \"\"In most cases, only foreign income taxes qualify for the foreign tax credit. Other taxes, such as foreign real and personal property taxes, do not qualify. But you may be able to deduct these other taxes even if you claim the foreign tax credit for foreign income taxes. In most cases, you can deduct these other taxes only if they are expenses incurred in a trade or business or in the production of in­come. However, you can deduct foreign real property taxes that are not trade or business ex­penses as an itemized deduction on Sched­ule A (Form 1040).\"\" Note and disclaimer: Sources: IRS Tax Topic 505 Interest Expense, IRS Real Estate (Taxes, Mortgage Interest, Points, Other Property Expenses) , IRS Topic 514 Foreign Tax Credit , and Publication 856 Foreign Tax Credit for Individuals\"" }, { "docid": "577554", "title": "", "text": "I'm a Finance major in Finland and here is how it would go here. As you loan money to the company, the company has no income, but gains an asset and a liability. When the company then uses the money to pay the bills it does have expenses that accumulate to the end of the accounting period where they have to be declared. These expenses are payed from the asset gained and has no effect to the liability. When the company then makes a profit it is taxable. How ever this taxable profit may be deducted from from a tax reserve accumulated over the last loss periods up to ten years. When the company then pays the loan back it is divided in principal and interest. The principal payment is a deduction in the company's liabilities and has no tax effect. The interest payment the again does have effect in taxes in the way of decreasing them. On your personal side giving loan has no effect. Getting the principal back has no effect. Getting interest for the loan is taxable income. When there are documents signifying the giving the loan and accounting it over the years, there should be no problem paying it back." }, { "docid": "146277", "title": "", "text": "\"Is this legal? Why not? But you might have trouble deducting losses on your taxes, especially if you sell to someone related to you in some way (which is indeed what you're doing). See the added portion below regarding dealing with \"\"related person\"\" (which a sibling is). The state of Maryland has a transfer/recordation tax of 1.5% for each, the buyer and seller. Would this be computed on the appraised or sale value? You should check with the State. In California property taxes are assessed based on sale value, but if the sale value is bogus the assessors have the right to recalculate. Since you're selling to family, the assessors will likely to intervene and set a more close to \"\"fair market\"\" value on the transaction, but again - check the local law. Will this pose any problem if the buyer needs financing? Likely, banks will be suspicious.Since you're giving a discount to your sibling, it will likely not cause a problem for financing. If it was an unrelated person getting such a discount, it would likely to have raised some questions. Would I be able to deduct a capital loss on my tax return? As I said - it may be a problem. If the transaction is between related people - likely not. Otherwise - not sure. Check with a professional tax adviser (EA or CPA licensed in Maryland). You mentioned in the comment that the buyer is a sibling. IRS Publication 544 has a list of what is considered \"\"related person\"\", and that includes siblings. So the short answer is NO, you will not be able to deduct the loss. The tax treatment is not trivial in this case, and I suggest to have a professional tax adviser guide you on how to proceed. Here's the definition of \"\"related person\"\" from the IRS pub. 544: Members of a family, including only brothers, sisters, half-brothers, half-sisters, spouse, ancestors (parents, grandparents, etc.), and lineal descendants (children, grandchildren, etc.). An individual and a corporation if the individual directly or indirectly owns more than 50% in value of the outstanding stock of the corporation. Two corporations that are members of the same controlled group as defined in section 267(f) of the Internal Revenue Code. A trust fiduciary and a corporation if the trust or the grantor of the trust directly or indirectly owns more than 50% in value of the outstanding stock of the corporation. A grantor and fiduciary, and the fiduciary and beneficiary, of any trust. Fiduciaries of two different trusts, and the fiduciary and beneficiary of two different trusts, if the same person is the grantor of both trusts. A tax-exempt educational or charitable organization and a person who directly or indirectly controls the organization, or a member of that person's family. A corporation and a partnership if the same persons own more than 50% in value of the outstanding stock of the corporation and more than 50% of the capital interest or profits interest in the partnership. Two S corporations if the same persons own more than 50% in value of the outstanding stock of each corporation. Two corporations, one of which is an S corporation, if the same persons own more than 50% in value of the outstanding stock of each corporation. An executor and a beneficiary of an estate unless the sale or exchange is in satisfaction of a pecuniary bequest. Two partnerships if the same persons directly or indirectly own more than 50% of the capital interests or profits interests in both partnerships. A person and a partnership if the person directly or indirectly owns more than 50% of the capital interest or profits interest in the partnership.\"" }, { "docid": "466718", "title": "", "text": "\"From the poster's description of this activity, it doesn't look like he is engaged in a business, so Schedule C would not be appropriate. The first paragraph of the IRS Instructions for Schedule C is as follows: Use Schedule C (Form 1040) to report income or loss from a business you operated or a profession you practiced as a sole proprietor. An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity or a hobby does not qualify as a business. To report income from a nonbusiness activity, see the instructions for Form 1040, line 21, or Form 1040NR, line 21. What the poster is doing is acting as a nominee or agent for his members. For instance, if I give you $3.00 and ask you to go into Starbucks and buy me a pumpkin-spice latte, you do not have income or receipts of $3.00, and you are not engaged in a business. The amounts that the poster's members are forwarding him are like this. Money that the poster receives for his trouble should be reported as nonbusiness income on Line 21 of Form 1040, in accordance with the instructions quoted above and the instructions for Form 1040. Finally, it should be noted that the poster cannot take deductions or losses relating to this activity. So he can't deduct any expenses of organizing the group buy on his tax return. Of course, this would not be the case if the group buy really is the poster's business and not just a \"\"hobby.\"\" Of course, it goes without saying that the poster should document all of this activity with receipts, contemporaneous emails (and if available, contracts) - as well as anything else that could possibly be relevant to proving the nature of this activity in the event of an audit.\"" }, { "docid": "396066", "title": "", "text": "Yes, if you can split your income up over multiple years it will be to your advantage over earning it all in one year. The reasons are as you mentioned, you get to apply multiple deductions/credits/exemptions to the same income. Rather than just 1 standard deduction, you get to deduct 2 standard deductions, you can double the max saved in an IRA, you benefit more from any non-refundable credits etc. This is partly due to the fact that when you are filing your taxes in Year 1, you can't include anything from Year 2 since it hasn't happened yet. It doesn't make sense for the Government to take into account actions that may or may not happen when calculating your tax bill. There are factors where other year profit/loss can affect your tax liability, however as far as I know these are limited to businesses. Look into Loss Carry Forwarded/Back if you want to know more. Regarding the '30% simple rate', I think you are confusing something that is simple to say with something that is simple to implement. Are we going to go change the rules on people who expected their mortgage deduction to continue? There are few ways I can think of that are more sure to cause home prices to plummet than to eliminate the Mortgage Interest Deduction. What about removing Student Loan Interest? Under a 30% 'simple' rate, what tools would the government use to encourage trade in specific areas? Will state income tax deduction also be removed? This is going to punish those in a state with a high income tax more than those in states without income tax. Those are all just 'common' deductions that affect a lot of people, you could easily say 'no' to all of them and just piss off a bunch of people, but what about selling stock though? I paid $100 for the stock and I sold it for $120, do I need to pay $36 tax on that because it is a 'simple' 30% tax rate or are we allowing the cost of goods sold deduction (it's called something else I believe when talking about stocks but it's the same idea?) What about if I travel for work to tutor individuals, can I deduct my mileage expenses? Do I need to pay 30% income tax on my earnings and principal from a Roth IRA? A lot of people have contributed to a Roth with the understanding that withdrawals will be tax free, changing those rules are punishing people for using vehicles intentionally created by the government. Are we going to go around and dismantle all non-profits that subsist entirely on tax-deductible donations? Do I need to pay taxes on the employer's cost of my health insurance? What about 401k's and IRA's? Being true to a 'simple' 30% tax will eliminate all 'benefits' from every job as you would need to pay taxes on the value of the benefits. I should mention that this isn't exactly too crazy, there was a relatively recent IRS publication about businesses needing to withhold taxes from their employees for the cost of company supplied food but I don't know if it was ultimately accepted. At the end of the day, the concept of simplifying the tax law isn't without merit, but realize that the complexities of tax law are there due to the complexities of life. The vast majority of tax laws were written for a reason other than to benefit special interests, and for that reason they cannot easily be ignored." }, { "docid": "525149", "title": "", "text": "I'm assuming you are in the US here. From a tax perspective you don't need to take any action to start a business and deduct expenses. If you have earned income coming from a source other than a W2 paying job, then you have a business. On your taxes, this means you file a schedule C (which is where you will deduct business expenses) and schedule SE (which computes how much FICA tax you will owe on your business income). When we talk about starting a business, we usually are talking about creating a corporation or LLC. No particular tax advantage to that in your case, but there could be liability advantages, if you are concerned about that. If you file losses consistently year after year, the IRS might try and classify your business as a hobby. That's what you should worry about. I suppose incorporating might reduce the probability of that, but it might not. Keep good records in case you need to argue with the IRS. If you do have to argue with them, they will want to ensure that you only used the laptop and internet for your business. That's a big if, but it's a potentially scary one. IRS Guidelines on hobby vs. business income Note: besides deducting expenses, another advantage of self-employment is opening a solo-401(k) or SEP or SIMPLE IRA. These potentially allow you to set aside a lot more money than the typical IRA and 401(k) arrangement. Thing is, you have to have a lot more earned income to really take advantage of them, but let's hope your app gets you there." }, { "docid": "440061", "title": "", "text": "It appears to me that the tax code gives significant advantages to being a corporation as opposed to being a person due to the relative ease of legal tax avoidance. As an individual, avoiding taxes is much harder than it is for a corporation. I mean, why can't I claim my deficit last year as an operating loss and use it to offset my taxes? I mean suppose I had to borrow money to afford food, that's pretty vital to my business (staying alive) operations. Why can't I offset my income with my borrowing like a corporation can?" }, { "docid": "390569", "title": "", "text": "Whether the amount so received from my son is taxable as my income in India ? No there is no tax liability for you. The money you received from you son would be treated as Gift and would come under Gift-Tax rules. As per current Gift Tax rules, you can receive unlimited funds from close relative, like your son. Any income you generate on these funds, i.e. interest on savings account, FD, etc is taxable to you. Your son maybe liable for taxes in US as in US Gift tax is on donor [i.e. your son]. The yearly limit is $14000 per person after which it can be deducted from estate limit or taxes paid." }, { "docid": "254158", "title": "", "text": "The LLC will file its own business taxes which may or may not have business level income and expenses. At the end, the LLC will issue Schedule K-1 tax forms to the members, that based on their percentage ownership, will reflect the percentage share of the income/losses. From an individual standpoint, the members need only worry about the K-1 form they receive. This has quite a few pass-through categories from the LLC, but the Income/Loss may be the only used one. The individual will likely include the K-1 by filing a Schedule-E along with their 1040 form. The 1040 Schedule-E has some ability to deduct expenses as an individual. Generally it's best not to commingle expenses. Additional schedule-E expense reporting is generally for non-reimbursed, but related business expenses. If a member paid certain fees for the LLC, it is better for the LLC to reimburse him and then deduct the expense properly. Schedule-E is on a non-LLC, personal level." }, { "docid": "248651", "title": "", "text": "Many states have a simple method for assessing income tax on nonresidents. If you have $X income in State A where you claim nonresident status and $Y income overall, then you owe State A a fraction (X/Y) of the income tax that would have been due on $Y income had you been a resident of State A. In other words, compute the state income tax on $Y as per State A rules, and send us (X/Y) of that amount. If you are a resident of State B, then State B will tax you on $Y but give you some credit for taxes paid to State A. Thus, you might be required to file a State A income tax return regardless of how small $X is. As a practical matter, many commercial real-estate investments are set up as limited partnerships in which most of the annual taxable income is a small amount of portfolio income (usually interest income that you report on Schedule B of Form 1040), and the annual bottom line is lots of passive losses which the limited partners report (but do not get to deduct) on the Federal return. As a result, State A is unlikely to come after you for the tax on, say, $100 of interest income each year because it will cost them more to go after you than they will recover from you. But, when the real estate is sold, there will (hopefully) be a big capital gain, most of which will be sheltered from Federal tax since the passive losses finally get to be deducted. At this point, State A is not only owed a lot of money (it knows nothing of your passive losses etc) but, after it processes the income tax return that you filed for that year, it will likely demand that you file income tax returns for previous years as well." }, { "docid": "576985", "title": "", "text": "How long you need to keep tax records will depend on jurisdiction. In general, if you discard records in a period of time less than your tax authority recommends, it may create audit problems down the road. ie: if you make a deduction supported by business expense receipts, and you discard those receipts next year, then you won't be able to defend the deduction if your tax authority audits you in 3 years. Generally, how long you keep records would depend on: (a) how much time your tax authority has to audit you; and (b) how long after you file your return you are allowed to make your own amendments. In your case (US-based), the IRS has straight-forward documentation about how long it expects you to keep records: https://www.irs.gov/businesses/small-businesses-self-employed/how-long-should-i-keep-records Period of Limitations that apply to income tax returns Keep records for 3 years if situations (4), (5), and (6) below do not apply to you. Keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later, if you file a claim for credit or refund after you file your return. Keep records for 7 years if you file a claim for a loss from worthless securities or bad debt deduction. Keep records for 6 years if you do not report income that you should report, and it is more than 25% of the gross income shown on your return. Keep records indefinitely if you do not file a return. Keep records indefinitely if you file a fraudulent return. Keep employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later. Note that the above are the minimum periods to keep records; for your own purposes you may want to keep them for longer periods than that. For example, you may be in a position to discover that you would like to refile a prior tax return, because you forgot to claim a tax credit that was available to you. If you would have been eligible to refile in that period but no longer have documentation, you are out of luck." }, { "docid": "499189", "title": "", "text": "In theory the integration of taxes make the tax implications of paying salary or dividends equal. This is what happens when you calculate the taxes using a generic tax calculator, however, the theory breaks down in certain cases. If you are earning less than $100k there is very little difference and paying out a salary is usually the better option. In a large stable company the most efficient option is almost always a mix of both. If you are earning more than $100k a year it depends on a number of factors: 1) Are your companies annual earnings over $500,000? In Canada, private companies that earn more than $500,000 annually are taxed at a higher rate than those earning less than $500,000. If the earnings are above $500,000 generally you should reduce the earning to under $500,000 by paying a salary. However, this depends on the province, the other income of the owners are and how much more than $500,000 your company earns. 2) Are you eligible for deductions or benefits only available on earned income? Earned income is income that you have worked for, which does not include dividends. RRSP contribution room, child care expense deductions, CPP, and many other benefits under the CRA rules are only available to people who have an earned income. It is worth taking advantage of these deductions when they are available. 3) Is your company eligible for any tax deductions? The same as with your personal tax deductions and your personal benefits of earning income, having a corporate income is also a benefit. There are a number of tax credits and tax deductions that corporations can take advantage of and when available these should be taken advantage of before paying everything out in salary. Once all these questions are answered the calculation is based on your marginal tax rate and the tax rate of the Corporation. One other reason to have at least a portion of you salary as a dividend is that if you incur capital loss in your corporation you can pass them to your personal taxes. If you were payed 100% in salary this does not work. Other strategies to be more tax efficient: Income splitting (Pay a salary/dividend to yourself, your wife, your children your parents, or anyone you support). Rolling-over property with taxable gains into your private corporation. Buying insurance policies that gives a return of premium or increase your Capital Dividend Account (CDA)." }, { "docid": "383532", "title": "", "text": "\"First of all, since you're 16 - you will not invest in anything. You cannot, you're a minor. You cannot enter contracts, and as such - you cannot transact in property. Your bank accounts are all UGMA accounts. I.e.: your guardian (or someone else who's the trustee on the account) will be the one transacting, not you. You can ask them to do trades, but they don't have to. They must make decisions in your best interest, which trades may not necessarily be. If however they decide to make trades, or earn interest, or make any other decision that results in gains - these are your gains, and you will be taxed on them. The way taxes work is that you're taxed on income. You're free to do with it whatever you want, but you're taxed on it. So if you realized gains by selling stocks, and reinvested them - you had income (the gains) which you did with whatever you felt like (reinvested). The taxman doesn't care what you did with the gains, the taxman cares that you had them. For losses it is a bit more complicated, and while you can deduct losses - there are limitations on how much you can deduct, and some losses cannot be deducted at all when realized (like wash sale losses or passive activity losses). When you have stock transactions, you will probably need to file a tax return reporting the transactions and your gains/losses on them. You may end up not paying any tax at all, but since the broker is reporting the transactions - you should too, if only to avoid IRS asking why you didn't. This, again, should be done by your guardian, since you personally cannot legally sign documents. You asked if your gains can affect your parents' taxes. Not exactly - your parents' taxes can affect you. This is called \"\"Kiddie Tax\"\" (unofficially of course). You may want read about it and take it into account when discussing your investments with your guardian/parents. If kiddie tax provisions apply to you - your parents should probably discuss it with their tax adviser.\"" }, { "docid": "88575", "title": "", "text": "\"A mutual fund's return or yield has nothing to do with what you receive from the mutual fund. The annual percentage return is simply the percentage increase (or decrease!) of the value of one share of the mutual fund from January 1 till December 31. The cash value of any distributions (dividend income, short-term capital gains, long-term capital gains) might be reported separately or might be included in the annual return. What you receive from the mutual fund is the distributions which you have the option of taking in cash (and spending on whatever you like, or investing elsewhere) or of re-investing into the fund without ever actually touching the money. Regardless of whether you take a distribution as cash or re-invest it in the mutual fund, that amount is taxable income in most jurisdictions. In the US, long-term capital gains are taxed at different (lower) rates than ordinary income, and I believe that long-term capital gains from mutual funds are not taxed at all in India. You are not taxed on the increase in the value of your investment caused by an increase in the share price over the year nor do you get deduct the \"\"loss\"\" if the share price declined over the year. It is only when you sell the mutual fund shares (back to the mutual fund company) that you have to pay taxes on the capital gains (if you sold for a higher price) or deduct the capital loss (if you sold for a lower price) than the purchase price of the shares. Be aware that different shares in the sale might have different purchase prices because they were bought at different times, and thus have different gains and losses. So, how do you calculate your personal return from the mutual fund investment? If you have a money management program or a spreadsheet program, it can calculate your return for you. If you have online access to your mutual fund account on its website, it will most likely have a tool called something like \"\"Personal rate of return\"\" and this will provide you with the same calculations without your having to type in all the data by hand. Finally, If you want to do it personally by hand, I am sure that someone will soon post an answer writing out the gory details.\"" }, { "docid": "542213", "title": "", "text": "\"From the IRS perspective, there's no difference between \"\"your taxes\"\" and \"\"your sole proprietorship's taxes\"\", they're all just \"\"your taxes\"\". While I could see it being very useful and wise to track your business's activities separately, and use separate bank accounts and the like, this is just a convenience to help you in your personal accounting, and not something that needs to relate directly to how tax forms are completed or taxes are paid. When calculating your taxes, if you want to figure out how much \"\"you\"\" owe vs. how much \"\"your business\"\" owes, you'll have to do so yourself. One approach might be just to take the amount that your Schedule C puts as income on your return and multiply by your marginal tax rate. Another approach might be to have your tax software run the calculations as though you had no business income, and see what just \"\"your personal\"\" taxes would have been without the business. If you think of the business income as being \"\"first\"\" and should use up the lower brackets rather than your personal income, maybe do it the other way around and have your software run the calculations as though you had only the business income and no other personal/investment income, and see what the amount of taxes would be then. Once you've figured out a good allocation, the actual mechanics of paying some \"\"personal tax amount\"\" from your personal bank account and some \"\"business tax amount\"\" from your business bank account are up to you. I'd probably just transfer the money from my business account to my personal account and pay all the taxes from the personal account. Writing two separate checks, one from each account, that total to the correct amount, I'm sure would work just fine as well. You can probably make separate payments from each account electronically through Direct Pay or EFTPS as well. As long as all taxes are paid by the deadline, I don't think the IRS is too picky about the details of how many payments are made.\"" }, { "docid": "30343", "title": "", "text": "\"You've asked a number of questions. I can answer a few. I've quoted your question before each answer. What are the ins and outs of a foreigner like myself buying rental property in Canada? This is a pretty broad question which can address location, finances, basic suggestions etc. Here's some things to consider: Provincial considerations: Some ins and outs will depend on what province you are considering and what area in that Province. If you plan on owning in Montreal, for example, that's in the province of Quebec and that means you (or someone) will need to be able to operate in the French language. There are other things that might be different from province to province. See stat info below. Canadian vs. US Dollar: Now might be a great time to buy property in Canada since the Canada dollar is weak right now. To give you an idea, at a non-cash rate of 1.2846, a little over $76,000 US will get you over $100k Canadian. That's using the currency converter at rbcroyalbank.com. Taxes for non-resident rental property owners: According to the T4144 Income Tax Guide for Electing Under Section 216 – 2015: \"\"When you receive rental income from real or immovable property in Canada, the payer, such as the tenant or a property manager, has to withhold non-resident tax at the rate of 25% on the gross rental income paid or credited to you. The payer has to pay us the tax on or before the 15th day of the month following the month the rental income is paid or credited to you.\"\" If you prefer to send a separate Canadian tax return, you can choose to elect under section 216 of the Income Tax Act. A benefit of this way is that \"\"electing under section 216 allows you to pay tax on your net Canadian-source rental income instead of on the gross amount. If the non-resident tax withheld by the payer is more than the amount of tax payable calculated on your section 216 return, [they] will refund the excess to you.\"\" You can find this guide at Canada Revenue's site: http://www.cra-arc.gc.ca/E/pub/tg/t4144/README.html Stats: A good place for stats is the Canada Mortgage and Housing Corporation (CMHC). So, if you are interesting in vacancy rates for example, you can see a table that will show you that the vacancy rate in Ontario is 2.3% and in British Columbia it's 1.5%. However, in New Brunswick it's 8%. The rate for metropolitan areas across Canada is 2.8%. If you want to see or download this table showing the vacancy rates by province and also by metropolitan areas, go to the Canada Mortgage and Housing Corporation site http://www.cmhc.ca/housingmarketinformation/. You can get all sorts of housing information, reports and market information there. I've done well with Condos/Town-homes and would be interested in the same thing over there. Is it pretty much all the same? See the stat site mentioned above to get market info about condos, etc. What are the down payment requirements? For non-owner occupied properties, the down payment is at least 20%. Update in response to comments about being double taxed: Regarding being taxed on income received from the property, if you claim the foreign tax credit you will not be double taxed. According to the IRS, \"\"The foreign tax credit intends to reduce the double tax burden that would otherwise arise when foreign source income is taxed by both the United States and the foreign country from which the income is derived.\"\" (from IRS Topic 856 - Foreign Tax Credit) About property taxes: From my understanding, these would not be claimed for the foreign tax credit but can be deducted as business expenses. There are various exceptions and stipulations based on your circumstance, so you need to read Publication 856 - Foreign Tax Credit for Individuals. Here's an excerpt: \"\"In most cases, only foreign income taxes qualify for the foreign tax credit. Other taxes, such as foreign real and personal property taxes, do not qualify. But you may be able to deduct these other taxes even if you claim the foreign tax credit for foreign income taxes. In most cases, you can deduct these other taxes only if they are expenses incurred in a trade or business or in the production of in­come. However, you can deduct foreign real property taxes that are not trade or business ex­penses as an itemized deduction on Sched­ule A (Form 1040).\"\" Disclaimers: Sources: IRS Topic 514 Foreign Tax Credit and Publication 856 Foreign Tax Credit for Individuals\"" }, { "docid": "512151", "title": "", "text": "Just from my own experience (I am not an accountant): In addition to counting as 'business income' (1040 line 12 [1]) your $3000 (or whatever) will be subject to ~15% self-employment tax, on Schedule SE. This carries to your 1040 line ~57, which is after all your 'adjustments to income', exemptions, and deductions - so, those don't reduce it. Half of the 15% is deductible on line ~27, if you have enough taxable income for it to matter; but, in any case, you will owe at least 1/2 of the 15%, on top of your regular income tax. Your husband could deduct this payment as a business expense on Schedule C; but, if (AIUI) he will have a loss already, he'll get no benefit from this in the current year. If you do count this as income to you, it will be FICA income; so, it will be credited to your Social Security account. Things outside my experience that might bear looking into: I suspect the IRS has criteria to determine whether spousal payments are legit, or just gaming the tax system. Even if your husband can't 'use' the loss this year, he may be able to apply it in the future, when/if he has net business income. [1] NB: Any tax form line numbers are as of the last I looked - they may be off by one or two." } ]

[ { "docid": "446553", "title": "", "text": "When your debt is forgiven, you have to consider the amount written off as an ordinary income item (with the exclusion of the debt originated from the purchase of primary home). If you're trying to write the debt off from your taxes - then it won't work. Even if you can expense the debt forgiveness, you will incur tax liability on your personal taxes side, and in addition you'll be out of cash in your business. So basically you'll end up paying it with after tax money, exactly the thing you're trying to avoid. In addition, you're dealing with related persons here, which means that the loss deduction might not be allowed (depends on the actual details of the transaction), so you might actually end up paying more taxes with this scheme that just paying off the loan directly (if your business pays taxes separately from your person). A loss on the sale or exchange of property between related persons is not deductible. This applies to both direct and indirect transactions, but not to distributions of property from a corporation in a complete liquidation. For the list of related persons, see Related persons next." } ]

[ { "docid": "303509", "title": "", "text": "\"Complex matter that doesn't boil down to a formula. The quant aspect could be assessed by calculating WACCs under various funding scenarii and trying to minimize, but it is just one dimension of it. The quali aspects can vary widely depending on the company, ownership structure, tax environment and business needs and it really can't be covered even superficially in a reddit comment... Few examples from the top of my mind to give you a sense of it: - shareholders might be able to issue equity but want to avoid dilution, so debt is preferred in the end despite cost. Or convertible debt under the right scenario. - company has recurring funding needs and thinks that establishing a status on debt market is worth paying a premium to ensure they can \"\"tap\"\" it whenever hey need to. - adding debt is a way to leverage and enhance ROI/IRR for certain types of stakeholders (think LBOs) - etc etc etc Takes time and a lot of experience/work to be able to figure out what's best and there isn't always a clear answer. Source: pro buy side credit investor with experience and sizeable AuMs.\"" }, { "docid": "190931", "title": "", "text": "When he says shitty, he means less likely to actually pay back the money. If I have a company that's not doing well enough, and I have already issued $100,000 in bonds onto this market, and I want to pay back all my bond-holders, maybe I convince a near-bankrupt company to give me $100,000 of bonds in their company for $50,000 in goods. I then repay my bondholders with the $100,000 in shitty bonds. Or maybe I give them $300,000 in goods and they give me $600,000 in their shitty bonds (since thier company is about to fall apart and they know I'll give them a kickback down the line). Then I pay back my 100k bonds with the new shitty bonds, and I go buy $500k worth of raw material for my company and pay for them using almost-bankrupt-company's shitty bonds . Then I have no debt, $500k worth of raw material, the people I used to owe money to (AND my suppliers) now hold a total of $600k in shitty bonds, and then my friend's almost-bankrupt-company DOES go bankrupt.... and my suppliers and old lenders realize the paper I just gave them is worthless." }, { "docid": "288633", "title": "", "text": "\"The basic equation taught in day one of accounting school is that Assets = Liabilities + Equity. My first point was that I looked at the actual financial statements published as of the end of the 2nd quarter 2017, and the total liabilities on their audited balance sheet were like $13 billion, not $20b. I don't know where the author got their numbers from. My second point: Debt usually needs to be paid on prearranged terms agreed upon by the debtor and the debtee, including interest, so it is important for a business to keep track of what they owe and to whom, so they can make timely payments. As long as they have the cash on hand to make payments plus whatever interest they owe, and the owners are happy with the total return on their investment, then it doesn't really matter how debt they have on the balance sheet. Remember the equation A=L+E. There are precisely two ways to finance a business that wants to acquire assets: liabilities and/or equity. The \"\"appropriate\"\" level of debt vs equity on a balance sheet varies wildly, and totally depends on the industry, size of the business, cash flow, personal preferences of the CEO, CFO, shareholders et al, etc. It gets way more detailed and complicated than that obviously, but the point is that looking at debt alone is a meaningless metric. This is corporate finance and accounting 101, so you can probably find tons of great articles and videos if you want to learn more.\"" }, { "docid": "170494", "title": "", "text": "\"We *are* talking at cross-purposes, but not for the reason you think. The debt might or might not be legally or practically recoverable (the apple-farmer and everything he owns might have been destroyed in the fire), but the value created and destroyed was real, and so was the money. You're focusing on the debt owed to the shoemaker, which is fine, but your mistake is thinking that the debt is in some way meaningfully different from money, which it's not. Most people who try to explain this difference would go off on a spiel about how the overwhelming majority of money on deposit in banks and otherwise in circulation has never been printed, or something, which is okay, but it's not a very convincing argument because you'll come back with something like, \"\"But I can still withdraw all my money, I can still cash all my checks, etc...\"\" So instead, I'm going to try and break this down, bear with me... The apple-grower got a deer (worth 12 loddars, let's set the \"\"interest\"\" part aside for the moment). I got a pair shoes (also worth loddars). Forget about the shoe-maker and the debt for a moment, and focus on me. I sold a deer, and I used the proceeds to buy a pair of shoes. - Did I defraud anyone? No, I engaged in a fair transaction with willing partners on both sides. - Did I get paid for the deer? Obviously I did, because I used the payment to buy shoes. - What did I get paid with, if not money? I can hear you saying \"\"yeah, but the shoe guy...\"\" Forget about the shoe guy. When buy something on Amazon marketplace and charge it on a credit card and then get paid via direct-deposit and then have the money taken from your account to pay off the credit-card company electronically, is all of that real money? Of course it is. Now, what happens if you die before paying the the credit-card bill? Does that mean that the money Amazon paid to the seller doesn't exist? Does that mean that money paid by the CC company to Amazon doesn't exist? How about the money in your bank account, does that exist? What if your employer once defrauded someone, how about then? None of that money has ever been *printed*, nobody got permission from Ben Bernanke to authorize these transactions, but the money that changed hands was absolutely real, even though it was nothing more than a *series of promises.* Before you argue with me, think this through: all these account-transfers ultimately boil down to *promises* by the end bank to produce cash when and if the account-holder walks up to a teller and demands it. The bank doesn't have nearly enough cash to pay every account-holder, but they *do* have enough (hopefully) to keep their promises, since they know they won't all be called in at once. Nobody ever actually delivered a package of paper currency to cover these transactions. Everyone is just trading promises, and passing those promises along to others. It sounds crazy to say it that way, but it is *absolutely* true. Tally up your net worth (or if that's too ugly, imagine tallying up someone's net worth who has a net worth). Chances are that you have never in your life seen that amount of paper cash, certainly not in your physical possession. So who has it? It's not like your local bank branch has a box marked \"\"C_B_M\"\" with $400,000 in bills and coins sitting there. What you have is a series of promises. When your employer gets by credit-card, the customer promises to pay the credit-card company, who promises to pay your employer's bank. Your employer then pays you with a direct-deposit whereby his bank promises to pay your bank. You then swipe an ATM card and your bank promises to pay the grocery-store's bank, who in turn sends a check to their supplier which is a promise that the grocery-store's bank will pay the supplier's bank, who in turn does the same with the farmer, who does the same with his mortgage-company, who does the same to their investors, who do the same to whoever they spend money with. Occasionally one of them takes a cash withdrawal to tip the stripper or stick in a birthday-card or buy hot-dogs at the ballpark or something, but overwhelmingly, we are all just spending and re-spending *promises*, and the remarkable thing is that, overwhelmingly, *we keep them*, without anyone involved ever hiring a truck to deliver a bindle of cash to the \"\"first person\"\" because there *is* no \"\"first person.\"\" All of that stuff is *absolutely real money*. I used the example of a wildfire, but maybe it will be more useful to think of something that just changes in value for no obvious reason. Think of some article of clothing that has gone out of style-- everyone was buying that stuff up until the day they stopped. Somewhere, someone was stuck with the last warehouse full of hot-pink parachute pants or whatever. A month before, when they were ordered from China or wherever, they were worth $50 each. Now you can't give them away. That value is gone, it's just vanished. The money that bought the pants was real, the pants are real, but they are no longer worth anything. The person holding that warehouse full of pants now has to *pay* to either store of dispose of them. They might start bouncing checks and breaking promises. There was no fraud, but there also might not be any way to recover the money owed. $10mm worth of parachute pants is now negative $1mm worth of trash that has to be disposed of and mortgage obligations on the warehouse. I hope some of that makes sense. It is really hard to explain this stuff via analogy and hypothetical and the kinds of terms that lawyers think in, if you will forgive me for saying so.\"" }, { "docid": "180073", "title": "", "text": "It is not right to force people to buy any product or service. Period. Do you see how wrong this is? I'd wager that you and I both agree that getting health insurance is a responsible thing to do. Ok, good. But I do not agree that anyone should be forced to buy anything. This is tyranny. Regardless of what is responsible or not, the government, or anyone else for that matter, has no right to force you to buy anything just for the simple fact that you breathe air. Obama signed into law a tax on all living people with the signing of Obamacare. So, because you're alive you are slapped with a tax until the day you die. It's a complete disgrace. This mandate is just one of the terrible things about Obamacare. Imagine what we could be forced to buy next? The federal government forcing us to go to college? Or perhaps the federal government forcing all employers to employ no less than 20 people? Or maybe they want everyone to buy cable. Mandating that anyone buy anything is not right in the least. And there is much more wrong with Obamacare than just the mandate and these other points I made. Forcing insurance companies to cover pre-existing (PE) conditions without being able to charge more is another blow to our liberty and freedom. When the government mandates that insurance companies must cover pre-existing conditions and must do so without charging more, you leave the door open for consumers to abuse this system. Obama effectively gave people the option to get insurance AFTER they get sick without consequence of higher prices. That is, by definition, not insurance. And then, when that person is no longer sick they can hop off their plan. Do you understand the economic effect of this? This is the reason why insurance premiums are skyrocketing. When someone hops on with a PE condition and then hops off during open enrollment, that person is paying $100 for $1,000 worth of medical care. My numbers of fictitious, but the concept remains the same. Imagine if you had a business where customers paid a monthly fee of $50 so that at any time they may withdraw $1,200 when they needed it. Well, the federal government decides to pass a law that says you cannot deny people that don't have a monthly subscription and need immediate financing. And now people can come in and give you $100 and in return you give them $1,000. Your business would be an epic fail except you did two things to combat this new law. 1) You raised your customers' monthly subscriptions from $50 to $75; and 2) You now require that monthly customers pay a $25 deductible before they are allowed to have their $1,200. As a business person, these changes were necessary because you were not allowed to deny walk-in customers that were exchanging their $100 for your $1,000. This is how Obamacare is affecting the insurance market. Insurance companies have to find a way to not lose money. Raising premiums and deductibles for paying customers is the only way to do it. In a perfect world, everyone buys health insurance before they are sick. And despite the fact that we don't live in a perfect world, there were still ways to get health insurance - and I'm talking pre-Obamacare - if you didn't have it before getting sick. You could have gotten a job that offered medical coverage in a group insurance plan. These plans always covered PE conditions. These plans are (still) required to cover PE conditions. I am not a bad person. I'm not greedy, either. I believe in social support system for those that truly need it. Sometimes people are born into bad situations or sometimes people can slip up and hit some bad luck. I am more than fine with helping those people out. But when the government puts their hands too deep into my pockets, it isn't just money they are grabbing. I spend over 40 hours a week at a job. That job is where I (obviously) make my money. Time is money. And so when the government is constantly creating new welfare programs, the government is taking time from my life. This is time that I want to spend with my friends, wife, mother, father, sister, and daughter. Time is limited for everyone and I want my time outside of my 40 hours at work. THAT is my right. That is all of our rights. You know, even the crazy, loony toon, socialist Bernie Sanders says that those people that work 40 hours a week deserve to make a living wage. Well, if companies weren't regulated so much we'd sure as hell have more money in our pockets. Less government regulations means more competition, more availability, more choices, and better prices. Look at the grocery store industry (i don't know the proper industry term). We have Shop Rite, Acme, Whole Foods, Publix, Wegmans, BJ's, Costco, Traders Joe's, Wawa, Sheetz, and so many more. Look at how stocked our supermarket shelves are...all the time. The only shortages that ever happen are when forecasts call for snowstorms and all the ice melt is gone. Other than that, shelves are stocked, food is fresh, and prices are excellent. And you don't have just one brand of sliced bread, or a single brand of peanut butter, or regular butter, or lettuce, or crackers, soup, meats, on and on and on....you have many brands for many products. We have 13 different kinds of milk in our grocery stores. Almond milk, soy milk, whole milk, 1%, 2%, organic milk, organic 1%.... The government didn't do any of this. People did. Smart. hard-working people did this. There is a market of consumers that want that stuff. And people made business to supply the demand. This is how things work. This is why we are the greatest country on this planet in the history of this world. Running water in your home. Central air. Life-saving surgery/drugs and physical therapy. Being able to turn on and off electricity with a switch. Make a pot of coffee right at your kitchen counter top. Read GoT right on your e-reader. Wash and dry your clothes in your own home. Print a document. Cars/motorcycles/segways. Contact lenses. Run on the treadmill. Play music on your bluetooth speaker from your Mac Book Pro. And this list can go on virtually forever. The government did not of this. People did. And if the government can get the hell out of our way, we can continue to improve the quality of life like we have been for hundreds of years now in this country." }, { "docid": "475273", "title": "", "text": "If someone invest certain amount on my company and after a year I am able to return the exact capital with the profit, what will I do to that investor? Did the investor receive shares in the company for the money that was invested in the company? This is the big question here as if so then there isn't the need to return the money but rather grow the business so that the investor's shares are worth more. Will that person still invest in my company? You may need to consider what you mean by invest as generally there are a couple of ways to finance a business: Equity - Ownership of the company is sold to raise money to run the company. Debt - The company is lent money that is to be repaid over time. Investing is usually the first case not the second. What if I have enough profit to continue my business, do I still need that investor? You wouldn't need the investor. However, you may want that investor as they could provide more funds, connections or other benefits to the company that may be worth considering here." }, { "docid": "556029", "title": "", "text": "\"Facebook is an \"\"online social networking service\"\" which I'd categorize as an ad-supported social media platform for a type of company. Facebook makes money from advertisers and applications on the site, so there are a couple of different income streams though in recent years Facebook has done a number of acquisitions that should be noted as the company is much more than just the FB site. In terms of B2C or B2B, I see Facebook as being a B2C where businesses are paying for access to consumers rather than businesses looking for other businesses. Some of the posts on Facebook can be \"\"Sponsored posts\"\" that are where things can be a bit blurry for what is an advertisement. At the same time, various games run through Facebook may also make Facebook some money since some games may use in-game purchases that are worth noting. B2B requires one to have 3 companies in the overall system: One that is the middle, one that is providing a service and one that is consuming a service. While Facebook is selling advertising on this site, I don't see this as that different from TV Networks and other distribution channels that ads are bought for consumers to use. There is something to be said for what audience is one aiming. B2B implies corporate customers which I doubt is what Facebook's customers want. Rather they are personal consumers that aren't companies on their own to my mind. If you want something closer to B2B consider Amazon.com's cloud services where companies may buy resources from Amazon as part of the systems they may use to interface with others. I can remember in a previous job that we used Clay Tablet for doing translation services that took content from my employer's servers to Amazon's cloud that would then be taken by the translation company for more than a few different pieces to the puzzle. While part of Facebook could be seen as B2B, I doubt I'd see them as a large part of it but I could be wrong as B2B/B2C distinctions aren't my specialty. Are they yours? Consider Paypal in contrast where a business may use Paypal for payment processing. Paypal has agreements that enable them to process payments either through individual bank accounts or merchant accounts as well as for the company that wants to use Paypal for their e-commerce site. Thus, there can be businesses on each side which is where I see this being a B2B company that is also B2C as some people may just be consumers. Consider Google as another contrast where companies may pay to use Google for e-mail and the Office-like products like Google Docs and Google Drive that I'm not sure is B2B as this is just a business buying services from Google that doesn't involve another company. While there is B2C, B2B and B2G, not every business has to tie into a specific category here for something else to consider.\"" }, { "docid": "296231", "title": "", "text": "\"Past results are not a predictor of future results. There is no explicit upper bound on a market, and even if individual companies' values were remaining unchanged one would expect the market to drift upward in the long term. Plus, there's been some shift from managing companies for dividends to managing stocks for growth, which will tend to increase the upward push. Trying to time the market -- to guess when it's going to move in any particular direction -- is usually closer to gambling than investing. The simplest answer remains a combination of buy-and-hold and dollar-cost averaging. Buy at a constant number of dollars per month (or whatever frequency you prefer), and you will automatically buy more when the stock/fund is lower, less when it is higher. That takes advantage of downturns as buying opportunities without missing out on possible gains at the other end. Personally, I add a bit of contrarian buying to that -- I increased my buying another notch or two while the market was depressed, since I had money I wouldn't need any time soon (buy and hold) and I was reasonably confident that enough of the market would come back strongly enough that I wasn't at significant risk of losing the investment. That's one of the things which causes me to be categorized as an \"\"aggressive investor\"\" even though I'm operating with a very vanilla mix of mutual funds and not attempting to micromanage my money. My goal is to have the money work for me, not vice versa.\"" }, { "docid": "528518", "title": "", "text": "Buy and hold doesn't have an exact definition, as far as I know. In my opinion, it's offered as a contrast to those who trade too frequently, or panic every time the market drops 2%. For the general market, e.g. your S&P index holdings. You sell to rebalance to your desired asset allocation. As a personal example, at 50, I was full up invested, 95%+ in stocks. When my wife and I were retired (i.e. let go from company, but with no need to go back to work) I started shifting to get to a more sane allocation, 80/20. The ideal mix may be closer to 60/40. Also, there are times the market as a whole is overvalued as measure by P/E and/or CAPE, made popular by Nobel Prize winning Robert Shiller. During these times, an allocation shift might make sense. For the individual stocks, you had best have a strategy when you buy. Why did you buy XYZ? Because they had promise, decent company with a good outlook for their product? Now that they are up 300%, can they keep gaining share or expand their market? Sometimes you can keep raising the bar, and keep a company long term, really long. Other times, the reason you bought no longer applies, they are at or above the valuation you hoped to achieve. Note - I noticed from another question, the OP is in the UK. I answer this my from US centric view, but it should still apply to OP in general. The question was not tagged UK when I replied." }, { "docid": "210958", "title": "", "text": "\"This article feels like a project by an editor to see how well his new hire can write a \"\"finance\"\" article. Low hanging fruit: explain Tesla's junk rating compared to Ford's. The conclusion I was hoping he reached, which is my belief, is that Musk flys to close to the sun trying to balance expansion and debt with cash flows and revenue. If they fail Ford's the best positioned car manufacturer in my opinion. Sure, the Volvo's of the world are going all electric, but that's not what makes Tesla appealing in my opinion. They're a tech company masked as a car company. Ford is a car company trying to pivot to a tech company. Electric isn't the future, the vehical cloud is. Someone has to make these cars. Google or apple won't. Ford will hopefully build and service their own.\"" }, { "docid": "38611", "title": "", "text": "\"There are different approaches, but here is what we do and what I recommend. Now that you are officially a married couple, open a joint bank account, and eliminate your individual accounts. There are several reasons for this. Having a joint account promotes unity and teamwork. When you only have a joint account, you do not have \"\"your income\"\" and \"\"her income,\"\" or \"\"your expenses\"\" and \"\"her expenses.\"\" You work together in everything. You discuss your goals and set your household budget together. If one of you makes more money than the other, that person is no longer \"\"worth more,\"\" because your incomes are pooled together. If one person with a higher income has more in their account than the other person does, it can lead to envy, which you do not want in your marriage. Having a joint account is more efficient and makes more sense. With separate accounts, who pays the rent/mortgage? Who pays the utilities, or buys the food? If you have separate accounts, it takes a lot of work to worry about what is \"\"fair\"\" when deciding how to divide up the expenses. With a single household budget and a joint account, you decide together what the household expenses are, and they get paid from one account. If one of you has debt, you both have debt. You work together to get it paid off and strengthen your financial situation in the process. Having a joint account forces you to discuss your finances together. Working toward common financial goals together is crucial in a strong marriage, but if you maintain your separate accounts, you might be tempted to put off these discussions until you are forced to by life circumstances. It is better to work together from the start, and joining your finances facilitates that. You are intending your marriage to last. Live your financial life like you believe that you are a team for life. If you live in a community property state, separate accounts are a fiction anyway; everything is treated as if it was pooled together in the event of a divorce. I understand that if you are used to having your own money, it can be difficult to give up that sole control over your income, but in my opinion, it is worth it. You will certainly hear of examples from couples who maintain separate accounts and make it work. In my humble opinion, combining your finances completely is easier to do right.\"" }, { "docid": "259560", "title": "", "text": "\"I'm in the US, so there may be idiosyncrasies with UK taxes that I'm not familiar with, but here's how I've always treated stock I get as compensation. Suppose the vested shares are worth X. If I had X in cash, would I buy my company's stock as an investment? Usually the answer is no, not because I think the stock will tank, but because there's better things I can do with that cash (pay off debt, unfortunately). Therefore I sell the shares and use the cash for something else. You have stock options. So suppose the stock value is X but you can buy it for Y. You can either: Therefore, the math is the same. If you had X in cash, would you buy your company's stock as an investment? If so, then option 2 is best, because you can get X in stock for a lower cost. (Option 3 might be better if the gain on the stock will be taxed higher, but they're pretty much equivalent if there's no chance that the stock will drop below Y) If not, then option 4 is best since you will likely get more than X-Y from selling the options that by exercising them and selling the stock (since options have time value). If option 4 is not a possibility, then option 1 is best - you pocket X-Y as \"\"income\"\" and invest it however you see fit.\"" }, { "docid": "40257", "title": "", "text": "\"The government thought of that a long time ago, and has any loophole there plugged. Like if you set up a company to buy a car and then allow you to use it ... You can use the car for company business, like driving to a customer's office to make a sales call or delivery, and the cost of the car is then tax deductible. But the company must either prohibit personal use of the car, or keep a log of personal versus business use and the personal use becomes taxable income to you. So at best you'd get to deduct an expense here and then you'd have to add it back there for a net change in taxable income of zero. In general the IRS is very careful about personal use of business property and makes it tough to get away with a free ride. I'm sure there are people who lie about it and get away with it because they're never audited, but even if that causes you no ethical qualms, it's very risky. I don't doubt that there are people with very smart lawyers who have found loopholes in the rules. But it's not as simple as, \"\"I call myself a business and now all my personal expenses become tax deductible business expenses.\"\" If you could do that, everybody would do it and no one would pay taxes. Which might be a good thing, but the IRS doesn't see it that way.\"" }, { "docid": "159344", "title": "", "text": "Yes, and now I'M the person who is drowning the public in debt due to my incompetence! You should see the size of my novelty check I got to bail me out. It's almost as big as my penis. By the way, my penis can also see the future." }, { "docid": "18349", "title": "", "text": "\"(Note: out of my depth here, but in case this helps...) While not a direct answer to your question, I'll point out that in the inverse situation - a U.S. investor who wants to buy individual stocks of companies headquartered outside US - you would buy ADRs, which are $-denominated \"\"wrapper\"\" stocks. They can be listed with one or multiple brokerages. One alternative I'd offer the person in my example would be, \"\"Are you really sure you want to directly buy individual stocks?\"\" One less targeted approach available in the US is to buy ETFs targeted for a given country (or region). Maybe there's something similar there in Asia that would eliminate the (somewhat) higher fees associated with trading foreign stocks.\"" }, { "docid": "52684", "title": "", "text": "\"I've been taking all the cheap fixed-rate debt banks would like to give me lately. What Rate? In practice I find the only way I get a low-enough rate on a longish-term fixed-rate loan is to use collateral. That is, auto loans and home loans. I haven't seen any personal loans with a low enough fixed rate. (Student loans may be cheap enough if they're subsidized, I guess.) Here's how I think of the rate: If you look at https://personal.vanguard.com/us/insights/saving-investing/model-portfolio-allocations , the average annual return on 80% bonds / 20% stocks is 6.7%, with worst year -10.3%. That's a nominal return not a real return. If you subtract taxes, say your marginal rate (the rate you pay on your last dollar of income) is 28% federal plus 5% state, then if you have no tax deferral the 6.7% becomes about a 4.5% average, with reasonably wide variation year-by-year. (You can mess with this, e.g. using tax-exempt bonds and tax-efficient stock funds, etc. which would be wise, but for deciding whether to take out debt, getting too detailed is false precision. The 6.7% number is only an average to begin with, not a guarantee.) Say you pay 4.5% on a loan, and you keep your money in very conservative investments, that's probably at least going to break even if you give it some years. It certainly can and sometimes will fail to break even over some time periods, but the risk of outright catastrophe is low. If your annual loss is 10%, that sucks, but it should not ruin your life. In practice, I got a home loan for close to 4.5% which is tax-deductible so a lower effective rate, and got an auto loan subsidized by the manufacturer for under 3%. Both are long-term fixed-rate loans with collateral. So I was happy to borrow this money paying about a 3% effective rate in both cases, well below my rough threshold of 4.5%. I do not, however, run a credit card balance; even though one of my cards is only 7% right now, 7% is too high, and it's a floating rate that could rise. The personal loans I've seen have too-high rates also. Thoughts Overall I think using debt as a tool requires that you're already financially stable, such that the debt isn't creating a risky situation. The debt should be used to increase liquidity and flexibility and perhaps boost investment returns a bit. Where you're likely to get into trouble is using debt to increase your purchasing power, especially if you use debt to buy things that aren't necessary. For me the primary reason to use debt is flexibility and liquidity, and the secondary \"\"bonus\"\" reason is a possible spread between the debt rate and investment returns.\"" }, { "docid": "163590", "title": "", "text": "\"So, I've read the article in question, \"\"Basically, It's Over\"\". Here's my opinion: I respect Charlie Munger but I think his parable misses the mark. If he's trying to convince the average person (or at least the average Slate-reading person) that America is overspending and headed for trouble, the parable could have been told better. I wasn't sure how to follow some of the analogies he was making, and didn't experience the clear \"\"aha\"\" I was hoping for. Nevertheless, I agree with his point of view, which I see as: In the long run, the United States is going to have serious difficulty in supporting its debt habit, energy consumption habit, and its currency. In terms of an investment strategy to protect oneself, here are some thoughts. These don't constitute a complete strategy, but are some points to consider as part of an overall strategy: If the U.S. is going to continue amassing debt fast, it would stand to reason it will become a worse credit risk, requiring it to pay higher interest rates on its debt. Long-term treasury bonds would decline as rates increase, and so wouldn't be a great place to be invested today. In order to pay the mounting debt and debt servicing costs, the U.S. will continue to run the printing presses, to inflate itself out of debt. This increase in the money supply will put downward pressure on the U.S. dollar relative to the currencies of better-run economies. U.S. cash and short-term treasuries might not be a great place to be invested today. Hedge with inflation-indexed bonds (e.g. TIPS) or the bonds of stronger major economies – but diversify; don't just pick one. If you agree that energy prices are headed higher, especially relative to U.S. dollars, then a good sector to invest a portion of one's portfolio would be world energy producing companies. (Send some of your money over to Canada, we have lots of oil and we're right next door :-) Anybody who has already been practicing broad, global diversification is already reasonably protected. Clearly, \"\"diversification\"\" across just U.S. stocks and bonds is not enough. Finally: I don't underestimate the ability of the U.S. to get out of this rut. U.S. history has impressed upon me (as a Canadian) two things in particular: it is highly capable of both innovating and of overcoming challenges. I'm keeping a small part of my portfolio invested in strong U.S. companies that are proven innovators – not of the \"\"financial\"\"-innovation variety – and with global reach.\"" }, { "docid": "322838", "title": "", "text": "How much amount can we transfer from India to the USA? Is the limit per year? As I understand your father in law is Indian Citizen and his tax paid earnings need to be transferred outside of India. Under the Liberalized Remittance Scheme by RBI, one can transfer upto 2,50,000 USD. Please check with your Bank for the exact paperwork. A form 15CA and 15CB [by CA] are required to establish taxes have been paid. What documents we have to present to the bank? See above. Should money be transferred to company's account(Indian Company) to USA company? or can be transferred to my husband's account. Transfer of funds by a Indian Company to US Company has some restrictions. Please check with CA for details. If you father in law has sold the Indian Company and paid the taxes in India; he can transfer the proceeds to his son in US as per the Liberalized Remittance Scheme. Can they just gift the whole amount to my husband? What will be the tax implication on my husband's part in USA and on my father in law in India. The whole amount can be gifted by your father in law to your husband [his son]. There is no tax implication in India as being an Indian resident, gift between close relatives is tax free. There is no tax implication to your husband as he is a US Citizen and as per gift tax the person giving the gift should be paying the applicable taxes. Since the person gifting is not US Citizen; this is not applicable." }, { "docid": "123013", "title": "", "text": "On paper the whole 6 months living costs sounds (and is) great, but in real life there are a lot of things that you need to consider. For example, my first car was constantly falling apart and was an SUV that got 16MPG. I have to travel for work (about 300 miles per week) so getting a sedan that averages close to 40MPG saves me more in gas and maintenance than the monthly payment for the new car costs. When our apartment lease was up, the new monthly rent would have been $1685 per month, we got a 30 year mortgage with a monthly payment of $1372. So buying a house actually let us put aside more each month. We have just under 3 months of living expenses set aside (1 month in liquid assets, 2 months in a brokerage account) and I worry about it. I wish we had a better buffer, but in our case the house and car made more sense as an early investment compared to just squirreling away all our savings. Also, do you have any debt? Paying off debt (student loans, credit card debt, etc.) should often take top priority. Have some rainy day funds, of course, but pay down debts, and then create a personal financial plan for what works best in your situation. That would be my suggestion." } ]

[ { "docid": "217218", "title": "", "text": "Firstly, I highly doubt anyone on this site will be able to provide you with accurate input on this matter regarding what TO DO. It's the what not to do that may be possible. That said, if you want to offer equipment for rent, which in a developing country is probably a decent idea, I'd start by asking around and doing some research on what people really need and are wanting to rent. I would suggest studying other developing/developed countries histories to see what companies were successful around a similar stage as well. I'd start small: pressure washers, generators, concrete mixers, fork lifts, hydraulic ladders, etc. Getting things that are just a bit too expensive for someone to own and something they don't need all the time. These can be great revenue generators because they're cheap to purchase, but can be rented at a premium." } ]

[ { "docid": "450041", "title": "", "text": "The answers provided so far as good and informative, but I just thought I'd add one small point... There are super-national organisations that commonly lend to governments, in particular those in the developing the world. The World Bank and IMF (International Monetary Fund) are the two primary ones. Also quite notably, the Greek economy was bailed out only this year by the EMF (European Monetary Fund) spearheaded by Germany - this is a rare occurrence however and was done mainly because Greece was a relatively developed country and others had an obligation to assist it as an EU member state." }, { "docid": "508343", "title": "", "text": "Because most people aren't willing to sacrifice their ability to live in the US for 100k. Remember that you can't pull this off multiple times easily. So as a one and done kind of deal, 100k isn't a great trade for the right to live in tthe US or whatever country you have roots in, particularly once you factor in:" }, { "docid": "300898", "title": "", "text": "Yea i agree with this but I do think that Amazon benefits a lot more from economies of scale than uber. Both are platform models where you get more profits by having more users. However, its a lot more difficult to compete with amazon (because of their warehouses, inventory, delivery speed etc etc) than it is to compete with uber( essentially has no inventory of its own). There is a cap to how much uber can charge on either side before it is profitable to enter the market and compete with uber. Furthermore, Uber has completely lost countries such as china so there is a limit to their top line. Also uber still has to fight its never-ending stream of litigation and that not just adds risk to the buisness but is a huge cost on uber. When it comes down to it, besides from the convenience of booking a ride from your phone, uber saves money by going around the fact that the drivers in uber do not need taxi licences and that directly cuts into government revenue. So far there hasnt been too much resistance but it is hard to say if it will remain the case in the future" }, { "docid": "152404", "title": "", "text": "Welcome to Havana, one of the world’s leading online books the Tour Package service for the holiday the Accommodations in Cuba. We believe passionately in the power of travel and strive each day to make quality travel experiences more accessible to Holiday rentals everyone. With over 350,000 properties in more than 150 countries, The company provides the best offers Holiday rentals in vinales and Affordable Accommodations in Cuba, from city apartments in Bratislava to chic studios in Slovakia, spacious lofts in Slovakia and beach houses on the exotic island. We operate our business under the idea that it is the small, local discoveries that make the holiday rentals something special. Our company is the ideal starting points for experiencing the many different types of the services." }, { "docid": "168905", "title": "", "text": "\"Long ago, a friend of mine shared with me the \"\"Lakshmi rule\"\" which can be used for managing one's spending: 1/3rd: Save, 1/3rd: Donate, 1/3rd: Survival. Survival refers to primary needs like food, clothing, shelter, medicine, family and priority needs like travel. The word \"\"Lakshmi\"\" comes from the Sanskrit language and is often used to denote money, wealth or opulence. Its etymological meaning is - to perceive, understand, objective, observe, to know etc. As per ancient thought leaders, wealth is to be used wisely and with great care. Carelessness and misuse of it means havoc not only in one's own life but also on a community level. Rather than seeing money as a source of one's own happiness, it should be used as tool for the larger good. This will give proper fulfillment in life and helps one shy away from spending on those little things which only give temporary happiness. Having a deeper perspective to our everyday actions and situations, can help develop beneficial habits that easily helps control one's impulsive urges and distractions.\"" }, { "docid": "243522", "title": "", "text": "\"He was Head of Public Health education in Sweden, responsible for (among other things) educating Swedish medical students on health trends. He identified wild areas of consistent \"\"positive\"\" ignorance (where wrong ideas can't be attributed to no knowledge) among the student population. This got him investigating how widespread these wrong ideas were in the Swedish public, which led him then to the EU, and then to all Europe and North America. Which then led to him creating a foundation to study this form of \"\"ignorance\"\" among educated people (where they do worse on statistical knowledge than would be produced by random results). The 3 areas they identified are Personal Bias (from limited personal experience), Education bias (from outdated teaching) and News bias (from \"\"the unusual sells stories\"\"). I don't know that he's done surveys in 3rd world (I'd imagine similar results) but he's mostly trying to fight first world \"\"ignorance\"\" by getting people to recognize and reverse their thought errors (things are generally getting better everywhere, most people are in the middle, rich and poor are one solid \"\"bell\"\" curve, You should assume you are over-estimating things that scare you) This has huge implications for anyone doing planning -- as he points out \"\"no wonder people think you can never eliminate poverty\"\" when they don't know that we eliminated half of world poverty in the last 20 years.\"" }, { "docid": "218709", "title": "", "text": "Paying up in full before the statement is posted does not seem a good idea. I feel you should keep some small amount to be posted as a statement balance and pay that in full each month. If you keep your statements as always 0 will give creditors an impression that you have cards and you don't utilize them, so they cant really gauge how you preform being debt, whether you are able to manage your debt well etc. I always keep <100 dollar in every credit card I have to be posted a statement balance. I have >100k credit line over 3 cards. So if I take air ticket to SE Asia runs into 3000$ for my family, I pay 2900.00 a day before statement generates and keep 100 for statement to be posted. pay 100 the next day or as auto debit. This way you have some utilization + lower credit card outstanding at any point make your utilization right in single digits." }, { "docid": "446114", "title": "", "text": "\"I would phrase it this way: if someone needs costly procedures, especially for conditions they caused themselves, then, yes, those procedures will not be covered, and they are not covered in all National Healthcare systems in the world. It's immoral to cover a liver transplant for a drunk or extended hospitalization for an obese person while an old lady cannot get an aid to stay independent in her home because it's not covered in the medical insurance. And I have no issue if the ACA will be repealed before a replacement is put in place. This will be the fastest way to get a replacement. It seems to me that you are not familiar with how National Health Care systems work, and so I will give you personal example, of my aunt, covered by the excellent national healthcare in Israel. And I mean it: it's one of the best National Health Care systems in the world. Her hips locked suddenly and she had to have a hip replacement. \"\"No problems!\"\" said the doctors: \"\"You will get hip replacement, totally covered by the insurance\"\". \"\"But, you have to wait 3 months for that.\"\" So my aunt said \"\"But I got supplemental private medical insurance\"\" (every one smart in Israel who can afford it get that.) \"\"Why didn't you tell us?\"\" asked the doctors, \"\"you will have the hip replacement done next week, with better parts.\"\" And so it happened. My aunt thought that, at least, the recovery and rehab in the hospital will be covered by her standard insurance. So, in the morning after the surgery, the nurse comes and says \"\"please make a choice: either I come once in the morning to take you out of bed to the toilet and some rehab, or, once in the evening\"\". My aunt chose none of the options, and paid out of her pocket (partially covered by her private insurance) to stay in a private hospital. Do you get it? But in Israel, an obese women will get her 3rd artificial insemination to have her 3rd baby + an aid to help her raise her kids because she's too fat to care of the her children. We have that nonsense in Israel.\"" }, { "docid": "475756", "title": "", "text": "\"As a Venezuelan who used to buy USD, I believe there is not better explanation than the one given to someone who actually lives and works here in Venezuela. Back in 1998 when Hugo Chavez took the presidency, we had a good economy. Fast forward 10 years laters and you could see how poor management, corruption and communist measurements had wreaked havoc in our Economy. It was because most of the money (USD) coming in Venezuela were not invested here but instead, given away to \"\"pimp countries\"\" like Cuba. Remember, communism lasts while you have money. Back then we had an Oil Barrel going over 100$ and crazy amounts of money were coming in the country. However, little to no money was invested in the country itself. That is why some of the richest people with bank account in Swiss are Venezuelans who stole huge amounts of Oil Money. I know this is a lot to take in, but all of this led to Venezuelan economy being the worst in The American Continent and because there is not enough money inside the country to satisfy the inner market, people would pay overprice to have anything that is bought abroad. You have to consider that only a very small amount of people can actually buy USD here in Venezuela. Back in 2013 I was doing it, I could buy about 80 usd/month with my monthly income. However, nowdays that's nearly impossible for about 99% of Venezuelans. To Illustrate. Minimum wage = 10.000 bolivares / month Black market exchange rate (As of January 2016) = 900bs per 1usd 10.000/900 = 11,11 usd. <<< that is what about 50% of Venezuelans earn every month. That's why this happens: http://i.imgur.com/dPOC2e3.jpg The guy is holding a huge stack of money of the highest Venezuelan note, which he got from exchanging only 100 usd. I am a computer science engineer, the monthly income for someone like me is about 30.000 bolivares --- so that is about 34$ a month. oh dear! So finally, answering your question Q: Why do people buy USD even at this unfavorable rate? A: There are many reasons but being the main 2 the following 1.- Inflation in Venezuela is crazy high. The inflation from 2014-2015 was 241%. Which means that having The Venezuelan currency (Bolivares) in your bank account makes no sense... in two weeks you won't be able to buy half of the things you used to with the same amount of money. 2.- A huge amount of Venezuelans dream with living abroad (me included) why, you ask? well sir, it is certain that life in this country is not the best: I hope you can understand better why people in 3rd world countries and crappy economies buy USD even at an unfavorable rate. The last question was: Q: Why would Venezuela want to block the sale of dollars? A: Centralized currency management is an Economic Measure that should last 6 months tops. (This was Argentina's case in 2013) but at this point, reverting that would take quite a few years. However, Turukawa's wikipedia link explains that very well. Regards.\"" }, { "docid": "131676", "title": "", "text": "You might be better off soliciting software engineers on AngelList. Coder and programmer is a bit derogatory also -- you are seeking an Engineer. With that said, I've been approached numerous times for things like this and the answer is always no. You are basically looking for a cofounder so be prepared to give away 50%. You need seed capital, and you don't really need an engineer for that so you should formalize the business plan and get funding. If you can't convince someone for 50 or 100k of seed then the idea is probably flat and you won't find an engineer who wants to touch it." }, { "docid": "339994", "title": "", "text": "In America, the government is ours. We vote for all the people in it. It is within our power to make it what we want and it is our responsibly to keep it functioning properly. We have been doing a poor job for the past couple of generations, but we have the ability to turn it around. To restrict the power of the US government is to reduce the power of the American people to determine the kind of society we want to live in. I do not want to live under the tyranny of huge multinational corporations who only care that I work and consume. Corporations haven't always owned and controlled the government to the degree they do today. They have always had influence, and that is not necessarily a bad thing. For the past 40 years, as we have been gradually moving towards a more laissez faire philosophy, government corruption has gotten worse and worse. Tax cuts for the uber rich, blanket free trade agreements with 3rd world countries, and deregulation have caused corporations get much larger and far more powerful than they were a generation or two ago. So much money has flooded into Washington because of these bad policy decisions, that it will be very hard to undo. But the only way to undo the damage caused by supply side economics is for the American people to decide they want something else and to vote accordingly." }, { "docid": "238074", "title": "", "text": "Paralegal? It varies from country to country (assuming SomeDutchGuy is Dutch), but in the US you just file papers, no lawyer or legal professional needed. That's why there's a limit on small claims court, so that small disputes can be settled without having to pay a lawyer (probably in excess of the disputed amount)." }, { "docid": "202864", "title": "", "text": "What do you mean by professional? Seems like you want to hire people to work and you to manage. This is fine but your costs will rise significantly. Seems like first you need more business to hire more people. Be careful that your market can support a larger buisness. Ive heard of many 2 bay car garage types going bankrupt after moving to a 4-6 bay because they couldnt keep the bays full 100% of the time" }, { "docid": "572626", "title": "", "text": "Well - not true at all. The border between Finland and Russia had until recently and probably still has one of the greatest differences in living standards of any border in the world, up there with USA/Mexico and Australia/Indonesia and Spain/Morocco. There are a lot of Estonians migrant workers working in Finland. Sweden takes per capita the most immigrants in the western world. It's not about the availability of work force. I guess you have not heard about the influx of people from Africa, Near East and Afganistan to the EU. It has been one of the big stories if the decade. EU takes more immigrants both relatively and in absolute terms than the US. I did not single out Scandinavia. I singled out the US. It's the only western country where the illegal unregulated largely immigrant service class does the dirty work for the whole economy. There are small pockets of that in EU as well - the seasonal workers of Spain for instance, but the US is really unique as a developed country." }, { "docid": "283851", "title": "", "text": "\"From Wikipedia A frontier market is a type of developing country which is more developed than the least developing countries, but too small to be generally considered an emerging market. The term is an economic term which was coined by International Finance Corporation’s Farida Khambata in 1992. The term is commonly used to describe the equity markets of the smaller and less accessible, but still \"\"investable\"\", countries of the developing world. The frontier, or pre-emerging equity markets are typically pursued by investors seeking high, long-run return potential as well as low correlations with other markets. Some frontier market countries were emerging markets in the past, but have regressed to frontier status. Investopedia has a good comparison on Emerging Vs Frontier While frontier market investments certainly come with some substantial risks, they also may post the kind of returns that emerging markets did during the 1990s and early 2000s. The frontier market contains anywhere from one-fifth to one-third of the world’s population and includes several exponentially growing economies. The other Question and are they a good option as well? This depends on risk appetite and your current investment profile. If you have already invested in domestic markets with a well diversified portfolio and have also invested in emerging markets, you can then think of expanding your portfolio into these.\"" }, { "docid": "529355", "title": "", "text": "I started an Apparel company. They started out small in their garage. They moved to my converted garage and when I got pregnant I decided to just take the leap at 5 months pregnant. Quit my zoo keeping job making very good money to making practically nothing and started a company from scratch. I had no name or really idea. But as the weeks passed I figured it out. Last year the company made 100k now that's not profit but I'm proud of it. Since I quit my job in July 2015. If you love it make it more than just a hobby. You'll thank yourself later. Good luck" }, { "docid": "203201", "title": "", "text": "I spent some time comparing banks' interest rates until I realized that it didn't actually matter (to me). The only money I keep in checking and savings accounts is money that I'm going to spend shortly or is part of an emergency fund, and in both those cases convenience of liquidity is far more important than small differences in interest (I want to be able to go to a nearby branch, even if traveling, and pull out large sums of money). The majority of our money goes into investment accounts, where it's earning much more than even the best savings account. Most of your 100k would be much better served in a stock/bonds mix. Are standard taxable investment accounts one of those things you can't open? What about if you opened one in your home country?" }, { "docid": "457549", "title": "", "text": "\"I appreciate the detailed responses, truthfully however I feel like at least half of your points are either just argumentative for its sake alone, display a deep lack of understanding of unions, collective bargaining, and the histories of both, or ignore pragmatism and cling to an uncompromising and ultimately self-defeating ideology. &gt; Collective bargaining is an ambiguous term that could refer to many concepts. There is voluntarily agreed to collective bargaining, which has nothing wrong with it, and then there are laws that FORCE the employer to collectively bargain with a union if a union requests it, which is a mandate and violates the employer's contract liberty. The law forces the two parties to sit at a table. The law forces the two parties to discuss a few core things, like wages. The law *doesn't* force anyone to agree to anything, and very often they don't. I don't see how this is a violation of anyone's \"\"contract liberty\"\" (a term I've actually never heard before). The idea is since these worker-employer disputes exist naturally, making them at least sit at a table together and talking is helpful in avoiding ego and testosterone fueled disruptions where no one benefits. If this you see this as a violation of one's liberty, I really don't know what to say to that. &gt; The prevalence of child labor was decreasing long before any law was created prohibiting it. Child labor is necessary in poor countries because people are far less productive per hour worked. I'm not saying I don't believe you, but citation needed. &gt; As productivity increases, parents can afford to send their children off to school instead of working, since their own work is enough to support the family. Wouldn't educating children first lead to an increase in productivity? Also, what if the owners of the means of production, only a few in an given area, have incomes 100x greater than the workers? They seem to be producing enough wealth to support themselves, only they're not the beneficiaries. What's the solution here? I understand that in a poor country child labor is seen as a necessity; however I think there is a moral issue when someone from a developed nation opens a factory in a third-world country with conditions that they would not want someone in their own family subjected to. Maybe these conditions are standard in the third-world country, but just because they're standard that doesn't mean the people there are happy with them. &gt; In other words, no government mandate created due to union-pressure can possibly lead to beneficial change, since laws that limit people's economic rights, under the assumption that 51% knows what's better for the minority than they themselves do, generally do much more harm than good. This is quite a leap. Problem is you always assume that a company is always paying workers as much as it can instead of having a net income that can absorb an uptick in overhead. &gt; As history over the last century has shown, it's no hyperbole. Labor unions-backed regulations (soft-socialism) has succeeded in spite of the resistance of employers. And you owe this to violence or the threat of violence? Citation needed. &gt; Because unions have destroyed nearly every major industry where they had a natural tendency to form (large scale capital intensive manufacturing operations where large numbers of workers were concentrated in one place). This is typical anti-union propaganda, and it's funny you pull it out since it ignores your own ideology. What interest would a union have in destroying the very industry it needs to exist? Answer: none. This is just a way for a business to deflect criticism when they want to outsource, killing US jobs just to increase their net income. Unions make concessions when they have to. &gt; The force of government prevents companies from refusing to collectively bargain with a labor union. Threat of violence? Violent strikes? This is a straw-man if I've ever seen one. Who is threatening violence here? This existed before government laws were created that made legal threats on behalf of employees that want to keep unionized employees employed and force companies to collectively bargain with a union. Now of course the strikers themselves are not directly threatening violence, since they are backed by the force of government. This is just showing a tremendous amount of ignorance regarding the way things actually happen. &gt; Collectively bargaining doesn't benefit workers in general. It benefits in the short-term, those workers who are employed and unionized, at the expense of long-term wage growth and employment opportunities for the unemployed and non-unionized employees. I have no idea how one could come to this conclusion. I can only assume it stems from the same old idea that employers are always paying out the most that they can afford. I happen to have first-hand knowledge that it's false however - when my workplace unionized recently, one of around a dozen locations nationally and the only one to organize, the company responded by increasing wages and benefits to all locations. Have any locations closed? No. Has anyone been laid off? No. Is the company still mad profitable? Yes.\"" }, { "docid": "427032", "title": "", "text": "First, what's the reason? Why do you have that much in cash at all - are you concerned about market volatility, are you planning to buy a house, do you have tens of millions of dollars and this is your slush fund? Are you a house flipper and this is part of business for you? If you need the money for short term use - ie, you're buying a house in cash next month - then as long as you're in a sound bank (one of the big national ones, for example) it seems reasonable. You can never predict a crash like 2008, but it seems unlikely that Chase or Citibank will go under in the next few weeks. If you like to have a cash position, then split the money among multiple banks. Buy a CD at one major bank with some of the amount. My in-laws have a trust which is partially invested in CDs, and they use multiple banks for this purpose to keep their accounts fully insured. Each separate bank you're covered up to 250k, so if you have $150k at Chase and $150k at a local bank, you're covered. (You're also covered in a much larger amount - up to 1MM potentially - if you are married, as you can have a separate account each for $250k and a joint account up to $500k.) Otherwise, why do you have that much in cash? You should invest it in something that will return more than inflation, at a minimum... Edit post-clarifications: $350k is around my level of 'Maybe, maybe not'. You're risking $100k on a pretty low risk (assuming this isn't a small local bank, and even those are pretty low still). In order to remove that risk you have to do something active - ie, take 100k somewhere else, open a new bank account, etc. - which isn't exactly the hardest thing in the world, but it does take effort. Is it worth the 0.001% chance (entirely made up) you lose the 100k? That's $10, if you agree with that risk chance. Up to you. It wouldn't be particularly hard, though, to open an account with an online bank, deposit $100k in there in a 6 month CD, then pay the IRS from your other account and when the 6 month CD expires take the cash back into your active account. Assuming you're not planning on buying a house in the next six months this should be fine, I'd think (and even then you'd still have $150k for the downpayment up front, which is enough to buy a $750k house w/o PMI). Additionally, as several commenters note: if you can reasonably do so, and your money won't be making significant interest, you might choose to pay your taxes now rather than later. This removes the risk entirely; the likely small interest you earn over 3 months may be similar to the amount you'd spend (mostly of your time, plus possibly actual expenses) moving it to another bank. If you're making 2% or 3% this may not be true, but if you're in a 0.25% account like my accounts are, $100k * 0.25% * 0.25 is $62.50, after all." } ]

[ { "docid": "344340", "title": "", "text": "\"(I'm assuming USA tax code as this is untagged) As the comments above suggest there is no \"\"right\"\" answer or easy formula. The main issue is that you likely got into business to make money and if you make money consistently you will pay taxes. Reinvesting generally should be a business decision where the main concern is revenue growth and taxes are an important but secondary concern. Taxes can be complicated, but for a small LLC shouldn't be that bad. I highly recommend that you take some time closely analyze your business and personal taxes for the previous year. Once you understand the problem better, you can optimize around it. If it is a big concern, some companies buy software so they can estimate their taxes periodically through the year and make better decisions.\"" } ]

[ { "docid": "82874", "title": "", "text": "If you know you will have a big bill, like braces. and you fully expect to hit the deductible then it can make sense. The deductible can trip some people up, because if they put too much into the limited purpose FSA and don't hit the deductible for the regular insurance policy, they can't get to all the money in the FSA. Because you have the ability to spend the potential money in the FSA before all the money has been contributed, it can allow you to make that payment for the braces in January. I did this the first year we had the HSA. I knew I needed to pay a dental bill early in the year. But the HSA would only have a few hundred dollars at that time, so I used the limited purpose FSA to be able to make that payment. This could also work if you spent a lot of money in the previous year. Because you have the ability to adjust how much money goes into the HSA each each pay period, this idea does keep the option open to fully fund the HSA if your finances improve. Regarding the deductible. The law limits what you can use the limited purpose FSA for: dental and vision only. There is an exception. If you hit the deductible for the high deductible insurance policy, then you can use the funds in the limited purpose FSA for ANY medical reason. When I did this a few years ago, I needed to send extensive paperwork to the company holding the funds before they would release the funds for dental. Once I sent them proof that I had met the deductible, then any medical expense after that date could use the FSA with minimal paperwork. If you fully fund the FSA beyond the cost of the braces, and then have a light year medical expense wise, you might not be able to spend all money in the FSA by the deadline. Regarding state taxes. I saw no difference in my states (Virginia) treatment of the funds. The state taxable income number was exactly the same as the federal taxable income number. It did not treat the money in the FSA differently than the money in the HSA." }, { "docid": "5188", "title": "", "text": "Basically you have 4 options: Use your cash to pay off the student loans. Put your cash in an interest-bearing savings account. Invest your cash, for example in the stock market. Spend your cash on fun stuff you want right now. The more you can avoid #4 the better it will be for you in the long term. But you're apparently wise enough that that wasn't included as an option in your question. To decide between 1, 2, and 3, the key questions are: What interest are you paying on the loan versus what return could you get on savings or investment? How much risk are you willing to take? How much cash do you need to keep on hand for unexpected expenses? What are the tax implications? Basically, if you are paying 2% interest on a loan, and you can get 3% interest on a savings account, then it makes sense to put the cash in a savings account rather than pay off the loan. You'll make more on the interest from the savings account than you'll pay on interest on the loan. If the best return you can get on a savings account is less than 2%, then you are better off to pay off the loan. However, you probably want to keep some cash reserve in case your car breaks down or you have a sudden large medical bill, etc. How much cash you keep depends on your lifestyle and how much risk you are comfortable with. I don't know what country you live in. At least here in the U.S., a savings account is extremely safe: even the bank goes bankrupt your money should be insured. You can probably get a much better return on your money by investing in the stock market, but then your returns are not guaranteed. You may even lose money. Personally I don't have a savings account. I put all my savings into fairly safe stocks, because savings accounts around here tend to pay about 1%, which is hardly worth even bothering. You also should consider tax implications. If you're a new grad maybe your income is low enough that your tax rates are low and this is a minor factor. But if you are in, say, a 25% marginal tax bracket, then the effective interest rate on the student loan would be more like 1.5%. That is, if you pay $20 in interest, the government will then take 25% of that off your taxes, so it's the equivalent of paying $15 in interest. Similarly a place to put your money that gives non-taxable interest -- like municipal bonds -- gives a better real rate of return than something with the same nominal rate but where the interest is taxable." }, { "docid": "50000", "title": "", "text": "\"What is a good bank to use for storing my pay? Preferrably one that has free student accounts. Can I save money from my paychecks directly to a Canadian bank Otherwise, can I connect my bank account to my Canadian account online? Any (almost...) bank in the US has free college checking accounts. If the bank you entered doesn't - exit, and step into the one next door which most likely will. The big names - Wells Fargo, Bank Of America, Chase, Bank of the West, Union Bank, Citi etc - all have it. Also, check your local credit union. Do I need any ID to open a bank account? I have Canadian citizenship and a J-1 visa Bring your passport and a student card/driving license (usually 2 ID's required). What form of money should I take with me? Cash? Should I apply for a debit card? Can I use my Canadian credit card for purchasing anything in the states? (Canadian dollar is stronger than US dollar currently, so this could be to my advantage?) There's some fuss going on about debit cards right now. Some big banks (Bank of America, notably) decided to charge fees for using it. Check it, most of the banks are not charging fees, and as far as I know none of the credit unions are charging. So same thing - if they charge fees for debit card - step out and move on to the next one down the street. Using debit card is pretty convenient, cash is useful for small amount and in places that don't accept cards. If you're asking about how to move money from Canada - check with your local (Canadian) bank about the conversion rates and fees for transfers, check cashing, ATM, card swipes, etc - and see which one is best for you. When I moved large amounts of money across the border, I chose wire transfer because it was the cheapest, but for small amounts many times during the period of your stay it may be more expensive. You can definitely use your Canadian credit/debit card in the States, you'll be charged some fee by your credit card company, and of course the conversion rate. How much tax does I have to pay at the end of my internship? Let's assume one is earning $5,000 per month plus a one time $5,000 housing stipend, all before taxes. Will I be taxed again by the Canadian government? $5K for internship? Wow... You need to talk to a tax specialist, there's probably some treaty between the US and Canada on that, and keep in mind that the State of California taxes your income as well. What are some other tips I can use to save money in the California? California is a very big place. If you live in SF - you'll save a lot by using the MUNI, if your internship is in LA - consider buying an old clunker if you want to go somewhere. If you're in SD - just enjoy the weather, you won't get it in Canada. You'll probably want a \"\"pay as you go\"\" wireless phone plan. If your Canadian phone is unlocked GSM - you can go to any AT&T or T-Mobile store and get a pre-paid SIM for free. Otherwise, get a prepaid phone at any groceries store. It will definitely be cheaper than paying roaming charges to your Canadian provider. You can look at my blog (I'm writing from California), I accumulated a bunch of saving tips there over the years I'm writing it.\"" }, { "docid": "235415", "title": "", "text": "\"Congratulations on earning a great income. However, you have a lot of debt and very high living expenses. This will eat all of your income if you don't get a hold of it now. I have a few recommendations for you. At the beginning of each month, write down your income, and write down all your expenses for the month. Include everything: rent, food, utilities, entertainment, transportation, loan payments, etc. After you've made this plan for the month, don't spend any money that's not in the plan. You are allowed to change the plan, but you can't spend more than your income. Budgeting software, such as YNAB, will make this easier. You are $51,000 in debt. That is a lot. A large portion of your monthly budget is loan payments. I recommend that you knock those out as fast as possible. The interest on these loans makes the debt continue to grow the longer you hold them, which means that if you take your time paying these off, you'll be spending much more than $51k on your debt. Minimize that number and get rid of them as fast as possible. Because you want to get rid of the debt emergency as fast as possible, you should reduce your spending as much as you can and pay as much as you can toward the debt. Pay off that furniture first (the interest rate on that \"\"free money\"\" is going to skyrocket the first time you are late with a payment), then attack the student loans. Stay home and cook your own meals as much as possible. You may want to consider moving someplace cheaper. The rent you are paying is not out of line with your income, but New York is a very expensive place to live in general. Moving might help you reduce your expenses. I hope you realize at this point that it was pretty silly of you to borrow $4k for a new bedroom set while you were $47k in debt. You referred to your low-interest loans as \"\"free money,\"\" but they really aren't. They all need to be paid back. Ask yourself: If you had forced yourself to save up $4k before buying the furniture, would you still have purchased the furniture, or would you have instead bought a used set on Craigslist for $200? This is the reason that furniture stores offer 0% interest loans. They got you to buy something that you couldn't afford. Don't take the bait again. You didn't mention credit cards, so I hope that means that you don't owe any money on credit cards. If you do, then you need to start thinking of that as debt, and add that to your debt emergency. If you do use a credit card, commit to only charging what you already have in the bank and paying off the card in full every month. YNAB can make this easier. $50/hr and $90k per year are fairly close to each other when you factor in vacation and holidays. That is not including other benefits, so any other benefits put the salaried position ahead. You said that you have a few more years on your parents' health coverage, but there is no need to wait until the last minute to get your own coverage. Health insurance is a huge benefit. Also, in general, I would say that salaried positions have better job security. (This is no guarantee, of course. Anyone can get laid off. But, as a contractor, they could tell you not to come in tomorrow, and you'd be done. Salaried employees are usually given notice, severance pay, etc.) if I were you, I would take the salaried position. Investing is important, but so is eliminating this debt emergency. If you take the salaried position, one of your new benefits will be a retirement program. You can take advantage of that, especially if the company is kicking in some money. (This actually is \"\"free money.\"\") But in my opinion, if you treat the debt as an emergency and commit to eliminating it as fast as possible, you should minimize your investing at this point, if it helps you get out of debt faster. After you get out of debt, investing should be one of your major goals. Now, while you are young and have few commitments, is the best time to learn to live on a budget and eliminate your debt. This will set you up for success in the future.\"" }, { "docid": "217472", "title": "", "text": "As you own a company, you need to know what your role is. You can never just move money into or out of the company, you have to identify the role in which you are doing it, and do it properly. There is Company, and there is You, in three different roles. You are the sole shareholder and director of Company. You are the sole employee of Company. You are also just a private person. You need to keep these three roles separate. As the sole shareholder, you own the company. However, you don't own any assets of the company. The company is yours, but the money in its bank account isn't. As a private person, you give a loan to your company. You write on a sheet of paper that You personally, give a loan to the company, how much a loan is, what interest is paid, and when the loan will be paid back (that could be 'whenever You demands the money paid back'). Then you move the money from your private bank account to the company bank account, and the company has the money it needs to fund its operation. Assume it wasn't you who loaned the money, but I gave the loan to the company. You can imagine that I would have this loan written down and signed before I hand over the cash. And you must have exactly the same papers that I would have. How do you get money from the company? The company can pay back your loan. That should be written down again, in the same way as the loan itself was written down. Other than that, there are three ways how you can get money out of the company: The company can pay You, in your role as its employee, a salary, which it can deduct from its profits. The company can pay money into a pension of the company director (that's You in your role as company director) up to £40,000 or so a year; that money is deducted from its profits again. The company pays 20% tax on its remaining profits. Then the company can pay You, in your role as company director, a dividend, usually twice a year. Each of these payments has to be written down and given to HMRC properly. Best by far to use an accountant to do all the paper work for you and advice you what to do. You can lose a lot of money by just not getting the paperwork right, by filing late etc., which the accountant will get right. The accountant will also tell you what are the optimal amounts for salary and dividend (best is a small salary, about £10,000 a year, dividend of about £30,000 a year, pension as much as the company can afford, which is then all tax free to you). You can't pay more dividend then the company can afford (paying a dividend and then not being able to pay your suppliers is criminal), and if you want higher dividends, then you will have to pay taxes on them." }, { "docid": "414692", "title": "", "text": "I’m not an expert on the VISA/US tax or insurance, but you're making enough mistakes in terms of all the associated costs involved in owning and renting houses/apartments that this already looks potentially unwise at this stage of your investment career. Renting cheap properties/to students involves the property constantly being trashed, often being empty and requiring extremely close management (which you either have to pay someone a lot to do, or do yourself and lose other potential earning time. If doing yourself you will also make lots of mistakes in the vetting/managing/marketing process etc at first as this is a complex art in itself). Costs on this type of rental can often get as high as 25% a year depending exactly how lucky you get even if you do it all yourself, and will typically be in the 5-15% range every year once everything you have to constantly maintain, replace and redecorate is totalled up. That's all pre what you could be earning in a job etc, so if you could earn a decent clip elsewhere in the same time also have to deduct that lost potential. Send it all to third parties (so all upkeep by hired contractors, all renting by an agency) you will be lucky to even break even off ~15k a year per property rents to students. You’re not seeming to price in any transaction costs, which usually run at ~5% a time for both entrance and exit. Thats between half and one years rent gone from the ten per property on these numbers. Sell before ten is up its even more. On point three, rounding projections in house price rises to one decimal place is total gibberish – no one who actually has experience investing their own money well ever makes or relies on claims like this. No idea on Pittsburgh market but sound projections of likely asset changes is always a ranged and imprecise figure that cannot (and shouldn’t) be counted on for much. Even if it was, it’s also completely unattainable in property because you have to spend so much money on upkeep: post costs and changes in size/standard, house values generally roughly track inflation. Have a look at this chart and play around with some reasonable yearly upkeep numbers and you will see what I mean. Renting property is an absolute graveyard for inexperienced investors and if you don't know the stuff above already (and it's less than 10% of what you need to know to do this profitably vs other uses of your time), you will nearly always be better off investing the money in more passive investments like diversified bonds, REITs and Stock." }, { "docid": "237338", "title": "", "text": "Saving money for the future is a good thing. Whether spending those savings on a business venture makes sense, will depend on a few factors, including: (1) How much money you need that business to make [ie: will you be quitting your job and relying on the business for your sole income? Or will this just be a hobby you make some pocket change from?] (2) How much the money the business needs up front [some businesses, like simple web design consulting, might have effectively $0 in cash startup costs, where starting a franchise restaurant might cost you $500k-$1M on day 1] (3) How risky it is [the general stat is that something like 50% of all new businesses fail in their first year, and I think for restaurants that number is often given as 75%+] So sometimes investing in your own business is financially risky, and other times it is not risky. Sometimes it is a good idea, sometimes it is not. Either way, saving for a future business that you may or may not ever invest in, is still saving money. If you never end up investing in a business, you can instead use that money for retirement, or whatever other financial goals you have. So it's not the saving for a new business that is risky, it's the spending. Part of good personal financial management is making financial goals, tracking your progress to those goals, and changing them as needed. In a simpler case, many people want to own their own home - this is a common financial goal, just like early retirement, or starting your own business, or paying for your kids' college education. All those goals are helped by saving money, so your job as someone mindful of personal finances, is to prioritize those goals in accordance to what is important for you. As mentioned by Stannius in the comments below, there is one catch here: if you are saving money for a short term goal (such as starting a business in a year), then you might want to keep it in low-interest savings accounts, instead of investing in the stock market. Doing this would remove the chance that your investments fail right before you need the startup money. Of course, this means that saving for a business that you never end up starting, could earn you less investment income on your savings. This would be the risk of saving for any specific short term goal that you end up changing later on." }, { "docid": "264326", "title": "", "text": "\"You sound like you're already doing a lot to improve your situation... paying off the credit cards, paying off the taxes, started your 401k... I'm in a similar situation, credit ruined & savings gone after the divorce. I know it feels like you're just spinning your wheels, but look at it this way: every monthly payment you make on a debt directly increases your net worth. Paying those bills regularly is one of the single best things you can do right now. As for how you can improve your situation, only two things really jump out at me: 1) $1,300 in rent, plus $300 in utilities, seems quite high for a single man. I don't know the housing costs in your area, though. Depending on where you live, you could cut that in half while still living alone, or get a roommate and save even more. You might have to accept a \"\"suboptimal\"\" living arrangement (like a smaller apartment), but we all have to sacrifice at times. 2) That last $1,000... you really need to budget how it's being spent. Consider cooking at home more / eating out less, or trading in your car for one with lower insurance premiums. Or spending less money on the kids. You say it's for their entertainment, but don't say what that is... are we talking about going to the movies once a month, or rock concerts twice a week? 3) If the kids are on their own for college, it's not the end of the world. I know you want to provide the best future you can for them... help them get good grades, and it'll do more for them than any amount of money. After all those & any other ways you find to save money, even if you can only put a hundred bucks in a savings account at the end of the month (and I'd be surprised if you couldn't put five), do it. Put it in, and leave it there, despite the temptation to take it out and spend it.\"" }, { "docid": "513051", "title": "", "text": "\"Interesting as I am in the exact same situations as yourself. I, in fact, just incorporated. You will be able \"\"save\"\" more in taxes in the end. The reason I put \"\"save\"\" in quotes, is that you don't necessarily save on taxes, but you can defer taxes. The driving factor behind this is that you specify your own fiscal calendar/year. Incorporating allows you to defer income for up to 6 months. Meaning that if you make your fiscal year starting in August or September, for example, you can claim that income on the following year (August + 6 months = February). It allows you to keep the current year taxes down. Also, any income left over at year end, is taxed at 15% (the Corporation rate) rather than the 30-40% personal rate you get with a sole-proprietorship. In a nutshell, with sole-proprietorship, all income is taxable (after write-offs)... in a corporation, you can take some of that income and keep it in the corporation (gives your company a \"\"value\"\"), and is only taxed at 15% - big saving there. I primarily work with US businesses. I am, however, a dual-citizen, US and Canadian, which allowed me as a sole-proprietor, to easily work with US companies. However, as a sole-proprietor or a Corporation, you simply need to get an EIN from the IRS and any US company will report earnings to that number, with no deductions. At year end, it is your responsibility to file the necessary tax forms and pay the necessary taxes to both countries. Therefore you can solicit new US business if you choose, but this is not restricted to corporations. The real benefit in incorporating is what I mentioned above. My suggestion to you is to speak with you CA, who can outline all benefits. Revenue Canada's website had some good information on this topic as well. Please let me know if you need anything else explained.\"" }, { "docid": "556072", "title": "", "text": "It depends what rate mortgage you can get for any extra loans... If you remortgage you are likely to get a rate of 3.5-4%... depending who you go with. With deposit accounts in the UK maying around 1% (yes, you can get more by tying it up for longer but not a huge amount more) clearly you're better off not having a mortgage rather than money in the bank. Does your 8k income allow for tax? If it does, you are getting 6% return on the money tied up in the flat. If you are getting 6% after tax on the invested money, that's way better than you would get on any left over cash paid into an investment. Borrowing money on a mortgage would cost you less than 6%... so you are better off borrowing rather than selling the flat. If you are getting 6% before tax... depending on your tax rate... it probably makes very little difference. You'd need to work out how much an extra 80k mortgage would cost you, how much the 50k on deposit would earn you and how much you make after tax. There is a different route. Set up a mortgage on the rental flat. You can claim the interest payment off the flat's income... reduce your tax bill so the effective mortgage rate on the flat would be less than what you could get with a mortgage on the new house. Use the money from the flat's mortgage to finance the difference in house price. In fact from a tax view, you may be better off having a mortgage free house and maxing out the mortgage on the flat so you can write off as much as possible against your tax bill. All of the above assume ... that the flat is rented all the time. The odd dry spell on the flat could influence the sums a lot. All of the above assume that your cash flow works whichever route you choose. As no-one on stack exchange has all of the numbers for your specific circumstances it may be worth talking to a tax accountant. They could advise you properly, knowing the numbers, which makes the best sense for you in terms of overall cost, cash flow, risk and so on." }, { "docid": "308332", "title": "", "text": "I'm all-in on hard silver, a small portion is stored at my house for emergency expenditures and the vast majority is in a high-security vault in Canada. That was actually the cheapest place I could find for long-term storage and insurance, which happened to be off-shore. It could turn out to be beneficial to be off-shore though. In the 1930s gold became illegal to privately own its very possible they could do the same this time, although they didn't in 1979. Oil is too high in volume to reasonably store. Gold isn't as undervalued as silver, which I could spend a full day talking about. But to sum it up in a few points: there is less silver than there is gold, gold has a premium for jewelry which will likely go down in a crash even though you will still see gains, silver is the second most used commodity besides oil, less people are in the know about it, silver prices were actually higher than gold a few times in the past century, simply measuring the dow in silver will show it's further below the historical average compared to gold. I'll stop there, but I could go on though on silver if people want. Real-estate is still very expensive from the 2008 recession, traditionally mortgages are $1.05 per dollar you would spend on renting the same property. Currently real-estate is at like $1.25+ I believe, It peaked at about $1.95. I rent, to save money, which you can spend on other assets. If one's willing to move to another state for lower taxes, they definitely should. Employment is going to be harder to come by, and they should get as much out of it as possible as they can. If they don't save enough, they could end up just using their entire savings during the whole thing if they can't find a job, in which case at the end you'd never know they knew it was going to happen. Overall I don't think this crash is going to be like the great depression. I don't feel compelled to store food and buy a generator or anything. I believe the living will be *easier* than it were to live in the 90s for those who are invested in assets. Everything is going to be on sale, meanwhile their wealth will be increasing. Depending on how much they own it could be increasing faster than they need to spend it. Sounds like the life to me. But with that said those without real assets, especially the lower class, will be unemployed and living on food stamps. Perhaps even the food stamps making more people leave the dollar and the economy. This actually might not be a prediction and is what happening already. But I don't believe anybody, in america at least, will be starving. In the 30s we had not mastered industry farming yet and we had the *dustbowl* to make things worse. Crime though, I'd own a gun. The protesters are here already, and I think we are just passing the half-way point right now, they will get angrier. I don't know enough about taxes to know the best country or place to store to combat taxes. Maybe someone else can chime in. I'm in canada to avoid high insurance and storage fees. And for careful selection of primary residence, In the long haul I'd rent a small apartment, as small and cheap as possible. In a safe neighborhood, but not so much secluded that a single grocery store or gas station going out of business could ruin it." }, { "docid": "90927", "title": "", "text": "Hard to give an answer without knowing more details (interest rates, remaining principle on loans, especially how soon the new roof is needed). Maintaining the value in your home (unless you are planning to walk away from it or short-sell or something) is of paramount importance, and the cost of a leak should it happen can be substantial. If the roof is a few years out, and you have loans with interest rates about oh I'd say around 6%or more then I would pay off those loans and take the money you were paying there and start putting it into a fund to pay for the roof. I am also a huge fan of doing whatever you can to max out your 401K contributions. Money put into a 401K early has a LOT more value than money put in later, and since you don't pay taxes on it, the cost out of your pocket is much lower (eg. at a 20% tax rate it costs you only $80 out of pocket to put $100 into your 401.. (look at that, you just made like 25% return on that $80) Paying off loans is pretty much equivalent to making a risk free return on the money equal to the interest rate on the loan. But to REALLY make that work, what you need to do is in a virtual sense, keep making the loan payment just now pay it to yourself, putting that money into a savings account, or towards your 401K or whatever. If you just torn around and start spending that money, then you are not really getting as much value to paying off the loan early." }, { "docid": "452837", "title": "", "text": "\"My grandma left a 50K inheritance You don't make clear where in the inheritance process you are. I actually know of one case where the executor (a family member, not a professional) distributed the inheritance before paying the estate taxes. Long story short, the heirs had to pay back part of the inheritance. So the first thing that I would do is verify that the estate is closed and all the taxes paid. If the executor is a professional, just call and ask. If a family member, you may want to approach it more obliquely. Or not. The important thing is not to start spending that money until you're sure that you have it. One good thing is that my husband is in grad school and will be done in 2019 and will then make about 75K/yr with his degree profession. Be a bit careful about relying on this. Outside the student loans, you should build other expenses around the assumption that he won't find a job immediately after grad school. For example, we could be in a recession in 2019. We'll be about due by then. Paying off the $5k \"\"other debt\"\" is probably a no brainer. Chances are that you're paying double-digit interest. Just kill it. Unless the car loan is zero-interest, you probably want to get rid of that loan too. I would tend to agree that the car seems expensive for your income, but I'm not sure that the amount that you could recover by selling it justifies the loss of value. Hopefully it's in good shape and will last for years without significant maintenance. Consider putting $2k (your monthly income) in your checking account. Instead of paying for things paycheck-to-paycheck, this should allow you to buy things on schedule, without having to wait for the money to appear in your account. Put the remainder into an emergency account. Set aside $12k (50% of your annual income/expenses) for real emergencies like a medical emergency or job loss. The other $16k you can use the same way you use the $5k other debt borrowing now, for small emergencies. E.g. a car repair. Make a budget and stick to it. The elimination of the car loan should free up enough monthly income to support a reasonable budget. If it seems like it isn't, then you are spending too much money for your income. Don't forget to explicitly budget for entertainment and vacations. It's easy to overspend there. If you don't make a budget, you'll just find yourself back to your paycheck-to-paycheck existence. That sounds like it is frustrating for you. Budget so that you know how much money you really need to live.\"" }, { "docid": "90290", "title": "", "text": "I think you're making a mistake. If you still want to make this mistake (I'll explain later why I think its a mistake), the resources for you are: IRS.GOV - The IRS official web site, that has all the up-to-date forms and instructions for them, guiding publications and the relevant rules. You might get a bit overwhelmed through. Software programs - TurboTax (Home & Business for a sole propriator or single member LLC, Business for more complicated business), or H&R Block Business (only one version that should cover all) are for your guidance. They provide tips and interactive guidance in filling in all the raw data, and produce all the forms filled for you according to the raw data you entered. I personally prefer TurboTax, I think its interface is nicer and the workflow is more intuitive, but that's my personal preference. I wrote about it in my blog last year. Both also include plug-ins for the state taxes (If I remember correctly, for both the first state is included in the price, if you need more than 1 state - there's extra $30-$40 per state). Your state tax authority web site (Minnesota Department of Revenue in your case). Both Intuit and H&R Block have on-line forums where people answer each others questions while using the software to prepare the taxes, you might find useful information there. As always, Google is your friend. Now, why I think this is a mistake. Mistakes that you make - will be your responsibility. If you use the software - they'll cover the calculation mistakes. But if you write income in a wrong specification or take a wrong deduction that you shouldn't have taken - it will be on your head and you're the one to pay the fines and penalties for that. Missed deductions and credits - CPA's (should) know about all the latest deductions and credits that you or your business might be entitled to. They also (should) know which one got canceled and you shouldn't be continuing taking them if you had before. Expenses - there are plenty of rules of what can be written off as an expense and how. Some things should be written off this year, others over several years, for some depreciation formula should be used, etc etc. Tax programs might help you with that, but again - mistakes are your responsibility. Especially for the first time and for the newly formed business, I think you should use a (good!) CPA. The CPA should take responsibility over your filing. The CPA should provide guarantee that based on the documents you provided, he filled all the necessary forms correctly, and will absorb all the fees and penalties if there's an audit and mistakes were found not because you withheld information from your CPA, but because the CPA made a mistake. That costs money, and that's why the CPA's are more expensive than using a program or preparing yourself. But, the risk is much higher, especially for a new business. And after all - its a business expense." }, { "docid": "36156", "title": "", "text": "\"&gt; If I come to your house with a gun and hand cuffs and say, \"\"you made this much money this year, therefore you owe me this much because I need healthcare/food/ect.\"\" Okay, so your argument is that taxes are illegitimate because they pay for services for others. Obviously I disagree, because in your example your money is *only* paying for services for other people. However, the reality is that we the minute we are born we benefit from living in a civilized society with services and infrastructure that was created by those who have paid taxes in the past. Your example is faulty because it assumes you receive no benefit from the taxes that the government demands of you. &gt; Yes, government made it happen, that doesn't mean that it would have never happened with out it. Possible, but we will never know. I think we agree that GPS does provide a valuable service, and it was created by government. This being one of thousands of examples of government innovation that has improved everyones lives, and provided the foundation for more innovation on the commercial market. It is possible that it would come to be in some form without government investment through taxes, but we know it *did* become reality through government through taxes. &gt; I would say that the US military has gone way overboard with the amount of technological spend. I would agree, to an extent. I would like to see investment in other areas, but that is what our elected leaders currently find of value. &gt; From what I've seen, the 2017 request is $12.5 billion for total tech spend for the military. I am not sure where that number is coming from. I know at one point JEIDDO by itself spent over $1T in R&amp;D on the IED problem. I know that DTRA funds a couple billion dollars worth of R&amp;D by itself too. Then you have groups like DOE, which do a lot of R&amp;D on defense projects as well. I think that number might be off. Drone technology was another example that you used. How much do you think the Amazon delivery drone service was influenced by DOD R&amp;D into drones? I have a buddy that I served with who worked at DTRA after he got out who now works at Amazon... &gt; Bernie Sanders bit Sorry, I think it may have got cut. I was going to ask what part of his tax plan would have added to your personal taxes?\"" }, { "docid": "412868", "title": "", "text": "No one has considered the tax write off at the end of the year? Will the house be in the parent's name or his, and can one of them take a write off for taxes and interest at the end of each year? On a small salary this may mean he has no tax liability for the four years, and can possibly make up the extra buying costs.... also, look at the comps in the area for the past five years and see if home values have increased and turnover rate for the area will tell you if people are buying in that area..." }, { "docid": "175951", "title": "", "text": "Unfortunately, the tax system in the U.S. is probably more complicated than it looks to you right now. First, you need to understand that there will be taxes withheld from your paycheck, but the amount that they withhold is simply a guess. You might pay too much or too little tax during the year. After the year is over, you'll send in a tax return form that calculates the correct tax amount. If you have paid too little over the year, you'll have to send in the rest, but if you've paid too much, you'll get a refund. There are complicated formulas on how much tax the employer withholds from your paycheck, but in general, if you don't have extra income elsewhere that you need to pay tax on, you'll probably be close to breaking even at tax time. When you get your paycheck, the first thing that will be taken off is FICA, also called Social Security, Medicare, or the Payroll tax. This is a fixed 7.65% that is taken off the gross salary. It is not refundable and is not affected by any allowances or deductions, and does not come in to play at all on your tax return form. There are optional employee benefits that you might need to pay a portion of if you are going to take advantage of them, such as health insurance or retirement savings. Some of these deductions are paid with before-tax money, and some are paid with after tax money. The employer will calculate how much money they are supposed to withhold for federal and state taxes (yes, California has an income tax), and the rest is yours. At tax time, the employer will give you a form W-2, which shows you the amount of your gross income after all the before-tax deductions are taken out (which is what you use to calculate your tax). The form also shows you how much tax you have paid during the year. Form 1040 is the tax return that you use to calculate your correct tax for the year. You start with the gross income amount from the W-2, and the first thing you do is add in any income that you didn't get a W-2 for (such as interest or investment income) and subtract any deductions that you might have that are not taxable, but were not paid through your paycheck (such as moving expenses, student loan interest, tuition, etc.) The result is called your adjusted gross income. Next, you take off the deductions not covered in the above section (property tax, home mortgage interest, charitable giving, etc.). You can either take the standard deduction ($6,300 if you are single), or if you have more deductions in this category than that, you can itemize your deductions and declare the correct amount. After that, you subtract more for exemptions. You can claim yourself as an exemption unless you are considered a dependent of someone else and they are claiming you as a dependent. If you claim yourself, you take off another $4,000 from your income. What you are left with is your taxable income for the year. This is the amount you would use to calculate your tax based on the bracket table you found. California has an income tax, and just like the federal tax, some state taxes will be deducted from your paycheck, and you'll need to fill out a state tax return form after the year is over to calculate the correct state tax and either request a refund or pay the remainder of the tax. I don't have any experience with the California income tax, but there are details on the rates on this page from the State of California." }, { "docid": "396222", "title": "", "text": "The key to understanding where your money is going is to budget. Rather than tracking your spending after the fact, budgeting lets you decide up front what you want to spend your money on. This can be done with cash envelopes, on paper, or on Excel spreadsheets; however, in my opinion, the best, most flexible, and easiest way to do this is with budgeting software designed for this purpose. As I explained in another answer, when it comes to personal budgeting software, there are two different approaches: those in which you decide what to spend your money on before it is spent, and those that simply show you how your money was spent after it is gone. I recommend the first approach. Software designed to do this include YNAB, Mvelopes, and EveryDollar. My personal favorite is YNAB. You'll find lots of help, video tutorials, and even online classes with a live teacher on YNAB's website. Using one of these packages will help you manage spending, whether it is done electronically or with cash. When you pay for something with a credit card, you enter your purchase into the software, and the software adjusts your budget as if the money is already spent, even if you haven't technically paid for the purchase yet. As far as strategy goes, here is what I recommend: Get started on one of these, and set up your budget right away. Assign a category to every dollar in your account. Don't worry if it is not perfect. If you find later on that you don't have enough money in one of your categories, you can move money from another category if you need to. As you work with it, you'll get better at knowing how much money you need in each category. My other recommendation is this: Don't wait until the end of the month to download your transactions from the bank and fit everything into categories. Instead, enter your spending transactions into the software manually, every day, as you spend. This will do two things: first, you'll have the latest, up-to-date picture of where your accounts are in your software without having to guess. Second, it will help you stay on top of your spending. You'll be able to see early on if you are overspending in a particular category. YNAB has a mobile app that I use quite a bit, but if I don't get a chance to enter a purchase right when I spend it, I make sure to keep a receipt, and enter the transaction in that evening. It only takes a couple of minutes a day, and I always know how I stand financially." }, { "docid": "351925", "title": "", "text": "\"1 - in most cases, the difference between filing joint or married filing single is close to zero. When there is a difference you're better off filing joint. 2 - The way the W4 works is based on how many allowances you claim. Unfortunately, even in the day of computers, it does not allow for a simple \"\"well my deduction are $xxx, don't tax that money.\"\" Each allowance is equal to one exemption, same as you get for being you, same as the wife gets, same as each kid. 3 people X $3800 = $11,400 you are telling the employer to take off the top before calculating your tax. She does this by using Circular E and is able to calculate your tax as you request. If one is in the 15% bracket, one more exemption changes the tax withheld by $570. So if you were going to owe $400 in April, one few exemption will have you overpay $170. i.e. in this 15% bracket, each exemption changes annual withholding by that $570. For most people, running the W4 numbers will get them very close, and only if they are getting back or owing over $500, will they even think of adjusting. 3 - My recently published Last Minute Tax Moves offers a number of interesting ideas to address this. The concept of grouping deductions in odd years is worth noting. 4 - I'm not sure what this means, 2 accounts each worth $5000 should grow at the same rate if invested the same. The time it makes sense to load one person's account first is if they have better matching. You say you are not sure what percent your wife's company matches. You need to change this. For both of your retirement plans you need to know every detail, exact way to maximize matching, expense ratios for the investments you choose, any other fees, etc. Knowledge is power, and all that. In What is an appropriate level of 401k fees or expenses in a typical plan? I go on to preach about how fees can wipe out any tax benefit over time. For any new investor, my first warning is always to understand what you are getting into. If you can't explain it to a friend, you shouldn't be in it. Edit - you first need to understand what choices are within the accounts. The 4% and 6% are in hindsight, right? These are not fixed returns. You should look at the choices and more heavily fund the account with the better selection. Deposit to her account at least to grab the match. As far as the longer term goals, see how the house purchase goes. Life has a way of sending you two kids and forcing you to tighten the budget. You may have other ideas in three years. (I have no P2P lending experience, by the way.) Last - many advise that separate finances are a bad path for a couple. It depends. Jane and I have separate check books, and every paycheck just keep enough to write small checks without worry, most of the money goes to the house account. Whatever works for you is what you should do. We've been happily married for most of the 17 years we've been married.\"" } ]

[ { "docid": "498927", "title": "", "text": "What would happen if you was to cash a check, didn’t realize it was to you and your finance company, take it to a local business that has a money center, they cash the check without even having you sign let alone having the finance companies endorsement on it . The money cleared my account like a couple months ago and it was just brought up now .. ? The reason why the check was made out the owner and the lender is to make sure the repairs were done on the car. The lender wants to make sure that their investment is protected. For example: you get a six year loan on a new car. In the second year you get hit by another driver. The damage estimate is $1,000, and you decide it doesn't look that bad, so you decide to skip the repair and spend the money on paying off debts. What you don't know is that if they had done the repair they would have found hidden damage and the repair would have cost $3,000 and would have been covered by the other persons insurance. Jump ahead 2 years, the rust from the skipped repair causes other issues. Now it will cost $5,000 to fix. The insurance won't cover it, and now a car with an outstanding loan balance of $4,000 and a value of $10,000 if the damage didn't exist needs $5,000 to fix. The lender wants the repairs done. They would have not signed the check before seeing the proof the repairs were done to their satisfaction. But because the check was cashed without their involvement they will be looking for a detailed receipt showing that all the work was done. They may require that the repair be done at a certified repair shop with manufacturer parts. If you don't have a detailed bill ask the repair shop for a copy of the original one." } ]

[ { "docid": "129350", "title": "", "text": "There are many reasons for buying new versus used vehicles. Price is not the only factor. This is an individual decision. Although interesting to examine from a macro perspective, each vehicle purchase is made by an individual, weighing many factors that vary in importance by that individual, based upon their specific needs and values. I have purchased both new and used cars, and I have weighted each of these factors as part of each decision (and the relative weightings have varied based upon my individual situation). Read Freakonomics to gain a better understanding of the reasons why you cannot find a good used car. The summary is the imbalance of knowledge between the buyer and seller, and the lack of trust. Although much of economics assumes perfect market information, margin (profit) comes from uncertainty, or an imbalance of knowledge. Buying a used car requires a certain amount of faith in people, and you cannot always trust the trading partner to be honest. Price - The price, or more precisely, the value proposition of the vehicle is a large concern for many of us (larger than we might prefer that it be). Selection - A buyer has the largest selection of vehicles when they shop for a new vehicle. Finding the color, features, and upgrades that you want on your vehicle can be much harder, even impossible, for the used buyer. And once you have found the exact vehicle you want, now you have to determine whether the vehicle has problems, and can be purchased at your price. Preference - A buyer may simply prefer to have a vehicle that looks new, smells new, is clean, and does not have all the imperfections that even a gently used vehicle would exhibit. This may include issues of pride, image, and status, where the buyer may have strong emotional or psychological needs to statisfy through ownership of a particular vehicle with particular features. Reviews - New vehicles have mountains of information available to buyers, who can read about safety and reliability ratings, learn about problems from the trade press, and even price shop and compare between brands and models. Contrasted with the minimal information available to used vehicle shoppers. Unbalanced Knowledge - The seller of a used car has much greater knowledge of the vehicle, and thus much greater power in the negotiation process. Buying a used car is going to cost you more money than the value of the car, unless the seller has poor knowledge of the market. And since many used cars are sold by dealers (who have often taken advantage of the less knowledgeable sellers in their transaction), you are unlikely to purchase the vehicle at a good price. Fear/Risk - Many people want transportation, and buying a used car comes with risk. And that risk includes both the direct cost of repairs, and the inconvenience of both the repair and the loss of work that accompanies problems. Knowing that the car has not been abused, that there are no hidden or lurking problems waiting to leave you stranded is valuable. Placing a price on the risk of a used car is hard, especially for those who only want a reliable vehicle to drive. Placing an estimate on the risk cost of a used car is one area where the seller has a distinct advantage. Warranties - New vehicles come with substantial warranties, and this is another aspect of the Fear/Risk point above. A new vehicle does not have unknown risk associated with the purchase, and also comes with peace of mind through a manufacturer warranty. You can purchase a used car warranty, but they are expensive, and often come with (different) problems. Finance Terms - A buyer can purchase a new vehicle with lower financing rate than a used vehicle. And you get nothing of value from the additional finance charges, so the difference between a new and used car also includes higher finance costs. Own versus Rent - You are assuming that people actually want to 'own' their cars. And I would suggest that people want to 'own' their car until it begins to present problems (repair and maintenance issues), and then they want a new vehicle to replace it. But renting or leasing a vehicle is an even more expensive, and less flexible means to obtain transportation. Expense Allocation - A vehicle is an expense. As the owner of a vehicle, you are willing to pay for that expense, to fill your need for transportation. Paying for the product as you use the product makes sense, and financing is one way to align the payment with the consumption of the product, and to pay for the expense of the vehicle as you enjoy the benefit of the vehicle. Capital Allocation - A buyer may need a vehicle (either to commute to work, school, doctor, or for work or business), but either lack the capital or be unwilling to commit the capital to the vehicle purchase. Vehicle financing is one area banks have been willing to lend, so buying a new vehicle may free capital to use to pay down other debts (credit cards, loans). The buyer may not have savings, but be able to obtain financing to solve that need. Remember, people need transportation. And they are willing to pay to fill their need. But they also have varying needs for all of the above factors, and each of those factors may offer value to different individuals." }, { "docid": "157496", "title": "", "text": "From your viewpoint you paying the dealer directly is better. You know that the check went to the dealer, and was used to purchase a car. If you give the check to your friend they may say I can't find the car I want this week, so I will purchase it next week but first let me by groceries and a new suit. I will replace the funds after my next paycheck. Next thing you know they are still short of funds. This might not happen, but it could. From your friends viewpoint getting a check from you allows them to potentially keep your part of the transaction out of view of the dealer/lender. In a mortgage situation the lender will take a look at your bank account to make sure there isn't a hidden loan, but I am not sure they do when they are approving a car loan. What you want to avoid is being a co-signer for the loan. As a co-signer you will be responsible for all payments; and missed payments will hurt your credit score." }, { "docid": "97484", "title": "", "text": "You submitted a claim for damage to the deck. The insurance company notified the mortgage company. Now the mortgage company wants to make sure that the collateral for the loan is still in good condition. They want you to make the repairs that you insisted needed to be done. They may even require you to use a licensed contractor before releasing the funds. Once you own the house without a mortgage, then you can decide for yourself if minor repairs need to be done." }, { "docid": "445739", "title": "", "text": "\"How/when does my employer find out? Do they get a report from their bank stating that \"\"check 1234 for $1212.12 paid to John Doe was never deposited\"\" or does it manifest itself as an eventual accounting discrepancy that somebody has to work to hunt down? The accounting department or the payroll company they use will report that the check was not deposited. The bank has no idea that a check was written, but the accounting deportment will know. The bank reports on all the checks that were cashed. Accounting cares because the un-cashed check for $1212.12 is a liability. They have to keep enough money in the bank to pay all the liabilities. It shouldn't be hard for them to track down the discrepancy, they will know what checks are outstanding. Can my employer punish me for refusing the money in this way? Do they have any means to force me to take what I am \"\"owed?\"\" They can't punish you. But at some time in the future they will will tell their bank not to honor the check. They will assume that it was lost or misplaced, and they will issue a new one to you. When tax time comes, and I still have not accepted the money, would it be appropriate to adjust my reported income down by the refused amount? You can't decide not to report it. The company knows that in year X they gave you a check for the money. They are required to report it, since they also withheld money for Federal taxes, state taxes, payroll taxes, 401K, insurance. They also count your pay as a business expense. If you try and adjust the numbers on the W-2 the IRS will note the discrepancy and want more information. Remember the IRS get a copy of every W-2. The employer has to report it because some people who aren't organized may not have cashed a December check before the company has to generate the W-2 in late January. It would confuse everything if they could skip reporting income just because a check wasn't cashed by the time they had to generate the W-2.\"" }, { "docid": "131255", "title": "", "text": "I had a similar situation when I was in college. The difference was that the dealer agreed to finance and the bank they used wanted a higher interest rate from me because of my limited credit history. The dealer asked for a rate 5 percentage points higher than what they put on the paperwork. I told them that I would not pay that and I dropped the car off at the lot with a letter rescinding the sale. They weren't happy about that and eventually offered me financing at my original rate with a $1000 discount from the previously agreed-upon purchase price. What I learned through that experience is that I didn't do a good-enough job of negotiating the original price. I would suggest that your son stop answering phone calls from the dealership for at least 1 week and drive the car as much as possible in that time. If the dealer has cashed the check then that will be the end of it. He owes nothing further. If the dealer has not cashed the check, he should ask whether they prefer to keep the check or if they want the car with 1000 miles on the odometer. This only works if your son keeps his nerve and is willing to walk away from the car." }, { "docid": "373691", "title": "", "text": "Here is another way to look at it. Does this debt enable you to buy more car than you can really afford, or more car than you need? If so, it's bad debt. Let's say you don't have the price of a new car, but you can buy a used car with the cash you have. You will have to repair the car occasionally, but this is generally a lot less than the payments on a new car. The value of your time may make sitting around waiting while your car is repaired very expensive (if, like me, you can earn money in fine grained amounts anywhere between 0 and 80 hours a week, and you don't get paid when you're at the mechanic's) in which case it's possible to argue that buying the new car saves you money overall. Debt incurred to save money overall can be good: compare your interest payments to the money you save. If you're ahead, great - and the fun or joy or showoff potential of your new car is simply gravy. Now let's say you can afford a $10,000 car cash - there are new cars out there at this price - but you want a $30,000 car and you can afford the payments on it. If there was no such thing as borrowing you wouldn't be able to get the larger/flashier car, and some people suggest that this is bad debt because it is helping you to waste your money. You may be getting some benefit (such as being able to get to a job that's not served by public transit, or being able to buy a cheaper house that is further from your job, or saving time every day) from the first $10,000 of expense, but the remaining $20,000 is purely for fun or for showing off and shouldn't be spent. Certainly not by getting into debt. Well, that's a philosophical position, and it's one that may well lead to a secure retirement. Think about that and you may decide not to borrow and to buy the cheaper car. Finally, let's say the cash you have on hand is enough to pay for the car you want, and you're just trying to decide whether you should take their cheap loan or not. Generally, if you don't take the cheap loan you can push the price down. So before you decide that you can earn more interest elsewhere than you're paying here, make sure you're not paying $500 more for the car than you need to. Since your loan is from a bank rather than the car dealership, this may not apply. In addition to the money your cash could earn, consider also liquidity. If you need to repair something on your house, or deal with other emergency expenditures, and your money is all locked up in your car, you may have to borrow at a much higher rate (as much as 20% if you go to credit cards and can't get it paid off the same month) which will wipe out all this careful math about how you should just buy the car and not pay that 1.5% interest. More important than whether you borrow or not is not buying too much car. If the loan is letting you talk yourself into the more expensive car, I'd say it's a bad thing. Otherwise, it probably isn't." }, { "docid": "289177", "title": "", "text": "\"Some reasons I take low-interest loans are: Leverage. If the loan's rate is low enough, then I can invest the cash in something fairly low-risk, and make more money than I pay in interest. The interest rate has to be pretty low, say below 4% or so. My auto loan is low enough and my home loan is low enough if you count the tax deduction. Obviously you have to invest in something riskier than cash here, though. And consider taxes, which lower the rate you're paying on a home loan, but also lower the returns you're getting on any bonds you invest in. Liquidity and flexibility. If I have N thousands in cash instead of tied up in my house, then I could use that money to survive many months of unemployment for example, or handle any other emergency. But if you become unemployed or have some other emergency, it will be too late to get a home loan. Credit rating. It's good to use some credit, just so you can get more if you need it. But this isn't a reason to take a particular loan, just a reason to have some kind of credit card or loan. Budgeting. When budgeting, it's best to think of expenses such as cars and houses in terms of a monthly cost, so you can see how they nudge out or allow other spending. (When negotiating with a car dealer, of course, use total cost so you don't get screwed by him messing with interest rates.) I wouldn't take a loan just to ease the budgeting (you can always manually \"\"amortize\"\") but it's a nice side effect. For credit cards, there are more buyer protections and you get a nice transaction log (again useful in budgeting). Also you don't have to carry around cash, or worry about your checking account balance. So credit cards are just convenient. But even though my card has a very low rate, it isn't low enough that I want to keep a balance month-to-month, so I don't use credit cards to actually borrow money.\"" }, { "docid": "69495", "title": "", "text": "\"Here's what you do without, on the negative side, just for balance: A bill: When I last had comprehensive insurance, it cost something like 3-4% of the value of the car per annum. (Obviously ymmv enormously but I think that's somewhere near the middle of the range and I'm not especially risky.) So, compared to the total depreciation and running costs of the car, it's actually fairly substantial. Over the say 10 years I might keep that car, it adds up to a fair slice of what it will take to buy a replacement. Financial crisis costs: I don't know about you, but my insurance went up something like 30% in recent years, despite the value-insured and the risk going down, said by the insurer to be due to market turmoil. So, at least hundreds of dollars is just kind of frictional loss, and I'd rather not pay it. Wrangling with the insurer: if you have insurance and a loss, you have to persuade them to pay out, perhaps document the original conditions or the fault, perhaps argue about whether their payment is fair. I've done this for small (non-automotive) claims, and it added up to more hassle than the incident itself. Obviously all insurers will claim they're friendly to deal with but until you actually have a big claim you never know. Moral hazard: I know I'm solely responsible for not having my car crashed or stolen. Somehow that just feels better. Free riders: I've seen people \"\"fudge\"\" their insurance claims so that things that shouldn't have been covered were claimed to be. You might have too. Buy insurance and you're paying for them. Choice: Insurers are typically going to make the decision for you about whether a claim is repairable or not, and in my experience are reluctant or refuse to just give you the cash amount of the claim. (See also, moral hazard.) Do it yourself and you can choose whether to live with it, make a smaller or larger repair, or replace the whole vehicle with a second hand one or a brand new one, or indeed perhaps do without a vehicle. A distraction: Hopefully by the time you've been working for a while, a vehicle is not a really large fraction of your net worth. If you lose 10% of your net worth it's not really nice but - well, you could easily have lost that off the value of your house or your retirement portfolio in recent years. What you actually need to insure is genuinely serious risks that would seriously change your life if they were lost, such as your ability to work. For about the same cost as insuring a $x car, you can insure against $x income every year for the rest of your life, and I think it's far more important. If I have a write-off accident but walk away I'll be perfectly happy. And, obviously, liability insurance is important, because being hit for $millions of liabilities could also have a serious impact. Coverage for mechanical failures: If your 8yo car needs a new transmission, insurance isn't going to help, yet it may cost more than the typical minor collision. Save the money yourself and you can manage those costs out of the same bucket. Flexibility: If you save up to replace your car, but some other crisis occurs, you can choose to put the money towards that. If you have car insurance but you have a family medical thing it's no help. I think the bottom line is: insure against costs you couldn't cope with by yourself. There are people who need a car but can just barely afford it, but if you're fortunate enough not to be in that case you don't really need comprehensive insurance.\"" }, { "docid": "128465", "title": "", "text": "Credit is very important even if you are wealthy. One thing you may not realize is that rich people typically have comparatively little cash on hand. If they're smart, most of their assets are not liquid - they're tied up in safe, long-term investments. They use credit for their day-to-day expenses and pay it off from the dividends on their investments (which might only come in once a quarter). There are also tax advantages to using credit. If a rich person wanted a new car, he'd be smarter leasing it for his business (immediate write-off of the lease payments on taxes) versus buying it (depreciation over several years plus property tax liability in some states). There are more elaborate tax dodges but the point is that buying a car outright is the worst option in terms of tax avoidance. Another way the rich (mis) use credit is so that they don't risk their own money on business ventures. Let's say I have $1,000,000 in my personal bank account, and I want to buy a business that costs $1M. If I am dumb, I clean out my bank account and put all my money in the business. I get 100% of the profits, but I also bear 100% of the risk. If I'm smart, I loan 200K of my own money in the business and put the rest someplace safe, and get a loan from a bank for the other 800K. If the business succeeds, the bank gets their money back plus interest. If it fails, the business declares bankruptcy and the bank eats the 800k loss. If I structured the debt right, my personal loan to the failed business gets paid back first when the company is liquidated, and the bank gets whatever is left over (if anything). The most of my own money I can possibly lose is 200k, and probably it's closer to zero if I have a good accountant." }, { "docid": "439293", "title": "", "text": "I've read online that 20% is a reasonable amount to pay for a car each month - Don't believe everything you read on the internet. But, let me ask, does your current car have zero expense? No fuel, no oil change, no repairs, no insurance? If the 20% is true, you are already spending a good chunk of it each month. My car just celebrated her 8th birthday. And at 125,000 miles, needed $3000 worth of maintenance repairs. The issue isn't with buying the expensive car, you can buy whatever you can afford, that's a personal preference. It's how you propose to budget for it that seems to be bad math. Other members here have already pointed out that this financial decision might not be so wise." }, { "docid": "336240", "title": "", "text": "\"If you are going to finance a used car, it is frequently best to arrange financing before you even pick out the car. The easiest way I recommend is to talk to a local credit union or two. They'll be able to tell you your interest rate and terms without having to talk to the dealer at all. Most likely, they'll be significantly better than the dealer at getting a good interest rate. As far \"\"what is a good rate?\"\", check out bankrate for average loan rates: http://www.bankrate.com/auto.aspx Today's numbers look like 2.87% is the average for a 48-month used car loan. That means if the bank comes back with something ridiculous like 9% or 10% you know they are way overcharging you. I know someone who got a first-time-buyer rate from Ford and ended up with a 19.99% rate. I could literally buy the car on my credit card and end up in a better spot. Honestly though, if you are 18 and have $5500 to put towards a car, I'd buy a $4500 car and save $1000 for repairs and maintenance. After you have the car, put $250 every month for a \"\"car payment\"\" into a savings account for your next car.\"" }, { "docid": "277664", "title": "", "text": "\"If I were you I would pay off these loans today. Here are the reasons why I would do this: Car Loan For car loans in particular, it's much better to not pay interest on a loan since cars lose value over time. So the longer you hold the debt, the more you end up paying in interest as the car continues to lose value. This is really the opposite of what you want to do in order to build wealth, which is to acquire assets that gain value over time. I would also recommend that once you pay the loan, that you set aside the payment you used to make on the loan as savings for your next car. That way, you will be able to pay cash for your next car, avoiding thousands of dollars of interest. You will also be able to negotiate a better price by paying cash. Just by doing this you will be able to either afford to buy a nicer car with the same amount of money, or to put the extra money toward something else. Student Loan For the student loan, 3% is a very low rate historically. However, the reason I would still pay these off is that the \"\"return\"\" you are getting by doing so is completely risk free. You can't often get this type of return from a risk-free investment instrument, and putting money in the stock market carries risk. So to me, this is an \"\"easy\"\" way to get a guaranteed return on your money. The only reason I might not pay this down immediately is if you have any other debt at a rate higher than 3%. General Reasons to Get out of Debt Overall, one of the basic functions of lifetime financial planning is to convert income into assets that produce cash flow. This is the reason that you save for retirement and a house, so that when your income ends when you're older these assets will produce cash, or in the case of the house, that you will no longer have to make rent payments. Similarly, paying off these debts creates cash flow, as you no longer have to make these payments. It also reduces your overall financial risk, as you'd need less money to live on if you lost your job or had a similar emergency (you can probably reduce your emergency fund a bit too). Discharging these loans will also improve your debt-to-income ratio if you are thinking of buying a house soon. I wonder whether as someone who's responsible with money, the prospect of cutting two large checks feels like \"\"big spending\"\" to you, even though it's really a prudent thing to do and will save you money. However, if you do pay these off, I don't think you'll regret it.\"" }, { "docid": "408124", "title": "", "text": "When you start at a new job here in the U.S., the default means of payment is usually a paper check. Most folks will quickly set up direct deposit so that their employer deposits their paycheck directly into their personal bank account - the incentive to do so is that you receive your funds faster than if you deposit a paper check. Even if you set up direct deposit on your first day on the job, you may still receive your first paycheck as a paper check simply because the wheels of payroll processing turn slowly at some (large) companies. A counter example is a self-employed contractor - perhaps a carpenter or house painter. These folks are paid by their customers, homeowners and such. Many larger, well established contracters now accept credit card payments from customers, but smaller independents may be reluctant to set up a credit card merchant account to accept payment by card because of all the fees that are associated with accepting credit card payments. 3% transaction fees and monthly service fees can be scary to any businessman who already has very thin profit margins. In such cases, these contractors prefer to be paid by check or in cash for the simple reason that there are no fees deducted from cash payments. There are a few folks here who don't trust direct deposit, or more specifically, don't trust their employer to perform the deposit correctly and on time. Some feel uncomfortable giving their bank info to their employer, fearing someone at the company could steal money from their account. In my experience, the folks who prefer a paper paycheck are often the same folks who rush to the bank on payday to redeem their paychecks for cash. They may have a bank account (helps with check cashing) but they prefer to carry cash. I operate in a manner similar to you - I use a debit card or credit card (I only have one of each) for nearly all transactions in daily life, I use electronic payments through my bank to pay my regular bills and mortgage, and I receive my paycheck by direct deposit. There have been periods where I haven't written or received paper checks for so long that I have to hunt for where I put my checkbook! Even though I use a debit card for most store purchases, the bank account behind that debit card is actually a checking account according to the bank. Again, the system defaults to paper checks and you have the option of going electronic as well. Before we judge anyone who doesn't use direct deposit or who prefers to be paid in cold hard cash, consider that direct deposit is a luxury of stability. Steady job, home, etc. Direct deposit doesn't make sense for a contractor or day laborer who expect to work for a different person each day or week. I don't think this is all that unique to the US. There are people in every city and country who don't have long-term employment with a single employer and therefore prefer cash or paper check over electronic payments. I'd be willing to bet that this applies to the majority of people on the planet, actually." }, { "docid": "561123", "title": "", "text": "\"While you would probably not use your ATM card to buy a $1M worth mansion, I've heard urban legends about people who bought a house on a credit card. While can't say its reliable, I wouldn't be surprised that some have actual factual basis. I myself had put a car down-payment on my credit card, and had I paid the sticker price, the dealer would definitely have no problem with putting the whole car on the credit card (and my limits would allow it, even for a luxury brand). The instruments are the same. There's nothing special you need to have to pay a million dollars. You just write a lot of zeroes on your check, but you don't need a special check for that. Large amounts of money are transferred electronically (wire-transfers), which is also something that \"\"regular\"\" people do once or twice in their lives. What might be different is the way these purchases are financed. Rich people are not necessarily rich with cash. Most likely, they're rich with equity: own something that's worth a lot. In this case, instead of a mortgage secured by the house, they can take a loan secured by the stocks they own. This way, they don't actually cash out of the investment, yet get cash from its value. It is similarly to what we, regular mortals, do with our equity in primary residence and HELOCs. So it is not at all uncommon that a billionaire will in fact have tons of money owed in loans. Why? Because the billions owned are owned through stock valuation, and the cash used is basically a loan secured by these stocks. It might happen that the stocks securing the loans become worthless, and that will definitely be a problem both to the (now ex-)billionaire and the bank. But until then, they can get cash from their investment without cashing out and without paying taxes. And if they're lucky enough to die before they need to repay the loans - they saved tons on money on taxes.\"" }, { "docid": "151435", "title": "", "text": "\"A credit Union makes loans exactly the same ways a bank does. A portion of the money deposited in checking, savings, money market, Certificate of Deposit, or IRA is then used to make loans for cars, boats, school, mortgages, 2nd mortgages, lines of credit... The government dictates the percentage of each type of deposit that must be held in reserve for non-loan transactions. The Credit Union members are the share holders of the \"\"company\"\". There are no investors in the \"\"company\"\" because the goal is not to make money. In general the entire package is better because there is no pressure to increase profits. Fees are generally lower because they are there to discourage bad behavior, not as a way to make a profit off of the bad behavior. Dividends/interest are treated the same way as bank interest. The IRS forms are the same, and it is reported the same way. Some of bizarre rules they have to follow: maximum number of transactions between accounts, membership rules, are there because banks want to make it harder to be a member of a credit union.\"" }, { "docid": "540539", "title": "", "text": "\"Sure, it's irresponsible for an executor to take actions which endanger the estate. But what about passivity or inaction? Put it another way. Is it the obligation of the executor to avoid making revenue for the estate? Think about it - what a silly idea! Consider a 12-unit apartment building full of rent paying tenants. A tenant gives notice and leaves. So do 4 more. With only 7/12 tenants, the building stops being a revenue center and becomes a massive money pit. Is that acceptable? Heck no! Realistically this will be managed by a property management company, and of course they'll seek new tenants, not stopping merely because the owner died. This situation is not different; the same fiscal logic applies. The counter-argument is usually along the lines of \"\"stuff might happen if you rent it out\"\"... true. But the stuff that happens to abandoned houses is much worse, and much more likely: squatters, teen \"\"urban explorers\"\", pot growers, copper thieves, winter pipe freeze flooding and wrecking interiors, etc. Don't take my word on it -- ask your insurer for the cost of insuring an abandoned house vs. a rented one. Renting brings a chunk of cash that comes in from tenants - $12,000/year on a $1000/mo. rental. And that will barely pay the bills if you have a young mortgage on a freshly purchased house at recent market rates. But on an old mortgage, renting is like printing money. That money propagates first to the estate (presumably it is holding back a \"\"fix the roof\"\" emergency fund), and then to the beneficiaries. It means getting annual checks from the estate, instead of constantly being dunned for another repair. But I don't care about making revenue (outside of putting back a kitty to replace the roof). Even if it was net zero, it means the maintenance is being done. This being the point. It is keeping the house in good repair, occupied, insured, and professionally managed -- fit and ready for the bequest's purpose: occupancy of an aunt. What's the alternative? Move an aunt into a house that's been 10 years abandoned? Realistically the heirs are going to get tired/bored of maintaining the place at a total cash loss, maintenance will slip, and you'll be moving them into a neglected house with some serious issues. That betrays the bequest, and it's not fair to the aunts. Rental is a very responsible thing to do. The executor shouldn't fail to do it merely out of passivity. If you decide not to do it, there needs to be a viable alternative to funding the home's decent upkeep. (I don't think there is one). Excluding a revenue-producing asset from the economy is an expensive thing to do.\"" }, { "docid": "88967", "title": "", "text": "Unless you own a business and the car is used in that business you can't write off your auto repairs. If you start a sole-proprietorship in your own name there are all sorts of things you can write off as long as there is a reasonable expectation of profit. This includes a portion of your car repairs, a portion of your home expenses (assuming it's a home-based business), any tools used in the business, all kinds of stuff. The portion of your auto is based on total miles driven in the year vs. total miles driven for business purposes. Eligible auto expenses include repairs, gas/oil, insurance, parking, and interest on the auto loan. There are some things to remember: I'm no expert on California business law. Talk to a lawyer and an accountant if you wish to go this way. Many offer a half-hour free session for new clients." }, { "docid": "45718", "title": "", "text": "\"I use online banking as much as possible and I think it may help you get closer to your goal. I see you want to know where the money goes and save time so it should work for you like it did for me. I used to charge everything or write checks and then pay a big visa bill. My problem was I never knew exactly how much I spent because neither Visa or check writing are record systems. They just generate transactions records. I made it a goal use online banking to match my spending to the available cash and ended up ok usually 9-10 months out of the year. I started with direct deposit of my paycheck. Each Saturday, I sit down and within a half hour, I've paid the bills for the week and know where I stand for the following week. Any new bill that comes in, I add it to online banking even if it's not a recurring expense. I also pull down cash from the ATM but just enough to allow me to do what I have to do. If it's more than $30 or $40 bucks, I use the debit card so that expense goes right to the online bank statement. My monthly bank statement gives me a single report with everything listed. Mortgage, utilities, car payment, cable bill, phone bill, insurance, newspaper, etc... It does not record these transactions in generic categories; they actually say Verizon or Comcast or Shop Rite. I found this serves as the only report I need to see what's happening with my budget. It may take a while to change to a plan like this one. but you'll now have a system that shows you in a single place where the money goes. Move all bills that are \"\"auto-pay\"\" to the online system and watch your Visa bill go down. The invested time is likely what you're doing now writing checks. Hope this helps.\"" }, { "docid": "175522", "title": "", "text": "I have gotten a letter of credit from my credit union stating the maximum amount I can finance. Of course I don't show the dealer the letter until after we have finalized the deal. I Then return in 3 business days with a cashiers check for the purchase price. In one case since the letter was for an amount greater then the purchase price I was able drive the car off the lot without having to make a deposit. In another case they insisted on a $100 deposit before I drove the car off the lot. I have also had them insist on me applying for their in-house loan, which was cancelled when I returned with the cashiers check. The procedure was similar regardless If I was getting a loan from the credit union, or paying for the car without the use of a loan. The letter didn't say how much was loan, and how much was my money. Unless you know the exact amount, including all taxes and fees,in advance you can't get a check in advance. If you are using a loan the bank/credit Union will want the car title in their name." } ]

[ { "docid": "536760", "title": "", "text": "\"There are at least three financial institutions involved here: your insurance company's bank, the money center, and your bank. Normally, they would keep records, but given that the money center didn't even ask for your signature, \"\"normal\"\" probably doesn't apply to them. Still, you can still ask them what records they have, in addition to the other two institutions; the company's bank and your bank likely have copies of the check.\"" } ]

[ { "docid": "514238", "title": "", "text": "\"Yes you tell them. I can say that I pay cash for all my cars and always get cars for lower than the TrueCar low-end. There are basically two steps: go test drive, negotiate fully, leave (unless you are given a mind-blowing offer). This may take you one to many dealerships. It depends on how well you know what car you want and how much a dealership will negotiate. you pick a night that another dealership that specifically has the car you want (or multiple - even better) is open and you go in 30-45 mins before they close. Paying cash is key for this to work. By the time you get to numbers they will be almost closed. Their finance guy might be gone so you will get your salesman and a manager. I will use my last car as an example. Toyota Highlander 2015 with MSRB 32,995. TrueCar at 29,795 with a good deal at 29,400. I simply talked to my sales guy said I would like to walk out with the car tonight. I have already talked to XYZ dealership and they offered me 28,500 - which is already below TrueCar low price. I asked for $27,900. Boom 10 minutes later car bought at 28,100. Cash is king. The sales guy and manager will bite the bullet on profit for ease of sale. Going in late is the key to using the cash. You don't have the finance guys jumping in and you have less people to move through. Also they know they have limited time to deal and if you walk off the lot there is less than 10% chance of you coming back - they want to close. They are making minimal profit but doing minimal work. With cash your sales guy is on your side because you are basically throwing him a couple hundred dollars at the end of a shift (where most would just be sitting around watching TV). Some other tips: be fair. If they would have said 28,300 is our lowest that we can go and that's it. I probably would have still got the car. Dealerships will tell you their lowest price if you are close and you are still below it. since they didn't show me their lowest price I didn't budge much but still budged a bit to show good sport. They brought their invoice number out to show that at 28,100 that they were going to lose $1500 on the car. I made the manager laugh because my response was to bring up KBB and show the used car price for the car, which was minus $2000. So I just said, \"\"Well you lost $1500 but I lose $2000 driving this off the lot.\"\" I then went back to $27,850 to meet in the middle of \"\"losing\"\" money. This actually closed the deal. Anyway don't ever believe any piece of paper they show you with numbers. These dealerships get monthly bonuses on sales and that is a lot of their profit past selling your trade-in. If you actually value your money you would never be trading in a car to a dealer so if you are paying cash, sell your own car or at least take it to a place like CarMax which I don't endorse but better than dealer.\"" }, { "docid": "260159", "title": "", "text": "\"I know, this isn't a direct answer to your question about unloading a used car-- I've always donated it to charity and written off the price it got at auction on my taxes -- but I think the following might be useful to anyone facing a big repair bill: You know your car's condition. (If in doubt, pay your mechanic to evaluate it \"\"as if he was considering buying it for his daughter\"\".) If you were shopping for a used car, and you found one exactly like yours, in exactly the same condition, treated exactly as well as you treat yours (and with all the records to prove that), but with the repairs already done... how much would you be willing to pay for it? If that number is more than the repair cost, repairing is a good deal. If it's less than the repair cost, is it enough less to justify the hassle of car shopping? If so, unload it and use the repair money to buy something better. If it's in the middle... flip a coin, or pick whichever makes you feel better.\"" }, { "docid": "69495", "title": "", "text": "\"Here's what you do without, on the negative side, just for balance: A bill: When I last had comprehensive insurance, it cost something like 3-4% of the value of the car per annum. (Obviously ymmv enormously but I think that's somewhere near the middle of the range and I'm not especially risky.) So, compared to the total depreciation and running costs of the car, it's actually fairly substantial. Over the say 10 years I might keep that car, it adds up to a fair slice of what it will take to buy a replacement. Financial crisis costs: I don't know about you, but my insurance went up something like 30% in recent years, despite the value-insured and the risk going down, said by the insurer to be due to market turmoil. So, at least hundreds of dollars is just kind of frictional loss, and I'd rather not pay it. Wrangling with the insurer: if you have insurance and a loss, you have to persuade them to pay out, perhaps document the original conditions or the fault, perhaps argue about whether their payment is fair. I've done this for small (non-automotive) claims, and it added up to more hassle than the incident itself. Obviously all insurers will claim they're friendly to deal with but until you actually have a big claim you never know. Moral hazard: I know I'm solely responsible for not having my car crashed or stolen. Somehow that just feels better. Free riders: I've seen people \"\"fudge\"\" their insurance claims so that things that shouldn't have been covered were claimed to be. You might have too. Buy insurance and you're paying for them. Choice: Insurers are typically going to make the decision for you about whether a claim is repairable or not, and in my experience are reluctant or refuse to just give you the cash amount of the claim. (See also, moral hazard.) Do it yourself and you can choose whether to live with it, make a smaller or larger repair, or replace the whole vehicle with a second hand one or a brand new one, or indeed perhaps do without a vehicle. A distraction: Hopefully by the time you've been working for a while, a vehicle is not a really large fraction of your net worth. If you lose 10% of your net worth it's not really nice but - well, you could easily have lost that off the value of your house or your retirement portfolio in recent years. What you actually need to insure is genuinely serious risks that would seriously change your life if they were lost, such as your ability to work. For about the same cost as insuring a $x car, you can insure against $x income every year for the rest of your life, and I think it's far more important. If I have a write-off accident but walk away I'll be perfectly happy. And, obviously, liability insurance is important, because being hit for $millions of liabilities could also have a serious impact. Coverage for mechanical failures: If your 8yo car needs a new transmission, insurance isn't going to help, yet it may cost more than the typical minor collision. Save the money yourself and you can manage those costs out of the same bucket. Flexibility: If you save up to replace your car, but some other crisis occurs, you can choose to put the money towards that. If you have car insurance but you have a family medical thing it's no help. I think the bottom line is: insure against costs you couldn't cope with by yourself. There are people who need a car but can just barely afford it, but if you're fortunate enough not to be in that case you don't really need comprehensive insurance.\"" }, { "docid": "489091", "title": "", "text": "You are really showing some wisdom here, and congratulations on finishing college. Its a lot about likelihoods. If you buy a new car, there is something like a 99.5% chance you will get a car that will not need repairs. If you buy a car for $1200 there is probably a 20% chance that the car will only need minimal repairs. So the answer is there is no real guarantee that spending any amount of money you will end up with a car with no repairs. You also can't assume that with buying a car it will immediately need repairs. Its possible, that you could spend 1200 on a car and it will need an oil change. In three months it might need brakes and in 6 months tires. If that is the case, you could save up the money for repairs. Have you looked for a car? It will take some work, but you might be able to find something in good condition for your budget. If you shop for a loan, go with a good credit union or local bank. Mostly you are looking for a low rate. However, I would advise against it. You worked so hard on getting out of school without debt, why start now? Be weird and buy a car for cash. Heck someone may be able to loan you a car for a short time while you save some money." }, { "docid": "336240", "title": "", "text": "\"If you are going to finance a used car, it is frequently best to arrange financing before you even pick out the car. The easiest way I recommend is to talk to a local credit union or two. They'll be able to tell you your interest rate and terms without having to talk to the dealer at all. Most likely, they'll be significantly better than the dealer at getting a good interest rate. As far \"\"what is a good rate?\"\", check out bankrate for average loan rates: http://www.bankrate.com/auto.aspx Today's numbers look like 2.87% is the average for a 48-month used car loan. That means if the bank comes back with something ridiculous like 9% or 10% you know they are way overcharging you. I know someone who got a first-time-buyer rate from Ford and ended up with a 19.99% rate. I could literally buy the car on my credit card and end up in a better spot. Honestly though, if you are 18 and have $5500 to put towards a car, I'd buy a $4500 car and save $1000 for repairs and maintenance. After you have the car, put $250 every month for a \"\"car payment\"\" into a savings account for your next car.\"" }, { "docid": "110503", "title": "", "text": "\"We payed off our Mortgage early...at first in small extra payments to principal, and finally a lump sum. Each extra payment to principal reduced the balance, and reduced every payment going forward. I have, somewhere, an excel spreadsheet where I tracked this... - =CUMIPMT((interestRate/12),term,pymtNumber,balance,balance,0) computed the interest payment due - =currentPrincipal + CUMIPRINTresultAbove computed the monthly principal payment Occasionally I would update the month-ending Principal balance against what the mortgage company told me. It was usually off by a little. My mortgage company required me to specifically contact them for a payoff amount before I wrote the final check. I've never heard of a mortgage where prepayment of all expected interest following the original schedule is required. I would guess it is against federal (US) law. Lets think about that for a moment... out of \"\"interest\"\", I recently computed that for our 30 year loan at 6-5/8% on about 145, we payed a total of 106000 in interest. That include a refi to 4-7/8 10-years in to a 15-year loan, and paying it off 20 years after the original loan was granted. As far as not paying all the theoretical interest due... - If they get a fixed dollar amount of service interest back, there's no incentive to me to pay on-time. I owe the same amount if I pay it today or if I pay it 6 months late, after I gambled the mortgage money and finally won. (yea, I know they could write the mortgage to penalize me for paying late, but I'm ignoring that) - if you were requried to pay off all the interest that might accrue, how could you ever sell your home, or refinance, for that matter? When I refi'd, the new holder payed the old holder 98,000. If the original holder had required prepayment of all the interest that would be accrued to the original schedule, the new mortgage would've been 200k. It would just never be a good deal to buy a home if mortgages worked under that term. I have had a car loan that worked differently -- they pre-computed the total interest due and then divided it over the term of the loan equally. I could pay off early and they stopped collecting interest.\"" }, { "docid": "34480", "title": "", "text": "\"I suppose this could really depend on the part of the world you're in, but there are still many instances of \"\"emergencies\"\" that need \"\"cash\"\". You have to decide how much cash is the right amount, but I still recommend having $1,000 or so in liquid cash. It can really make a huge difference. Let me give a few examples. Bad weather. I live in Florida and after a hurricane if you want gas, food, or water, you're going to need cash. ATM networks are the last to get repaired. Same for internet. Cell services are not at the top of the list. You could be 4-5 days without access to your accounts. If you need anything in that time frame it's cash or the Red Cross. Children. As a foster parent we keep some cash on hand because as kids come in to our care we want to get them in school right away. How are they going to eat? You can't give them your plastic, you haven't had time to setup \"\"lunch accounts\"\" or the like. Cash always works. Along those same lines are bus tickets, clothes, supplies and what not. Not everywhere will take an ATM card, and if your money is tied up in a stock then what are you supposed to do for 3 days? Tell your new kid that he can't eat? Big Emergency problems. Like your car breaks down on the interstate. Sure it can get towed to the dealership, and yes they will add the tow to your bill, and sure you have a few days to pay it (while your car gets fixed), but how are you going to get around? Not all taxis take plastic around here. Almost none of the busses take plastic even though they are supposed to. Lost Wallet or ID theft. Lose your wallet, good luck getting into your bank accounts. It can take weeks to establish your ID after you lose it in some cases. You want your ID, but you need your birth certificate. You have to GO to the state of birth and request it. Oh but wait, to travel you need an ID. No problem send away for it, but wait, you need to send them money to mail it. To bad all your money is tied up. Running or Evacuating - So you need to evacuate for some reason. No big deal. But all your money is in a place you can't get to it. How do you put gas in your car. Lets stick with it and say you get to \"\"cash out\"\" an account of some kind. Guess what, they're not going to mail it to some random address. Now you're stuck fighting support centers to get them to understand that you need your funds delivered to New York even though you live in Florida. In short, you don't need $100,000 in liquid funds, but there are a few cases that you need something liquid. You also make a lot of assumptions. For example, not every one will have health insurance, or a heath problem that is covered by their insurance. Some serious home repairs are \"\"down payment\"\" upfront. Car problems like an accident that means you need a rental can totally be up front. Especially if credit cards can't be used.\"" }, { "docid": "540539", "title": "", "text": "\"Sure, it's irresponsible for an executor to take actions which endanger the estate. But what about passivity or inaction? Put it another way. Is it the obligation of the executor to avoid making revenue for the estate? Think about it - what a silly idea! Consider a 12-unit apartment building full of rent paying tenants. A tenant gives notice and leaves. So do 4 more. With only 7/12 tenants, the building stops being a revenue center and becomes a massive money pit. Is that acceptable? Heck no! Realistically this will be managed by a property management company, and of course they'll seek new tenants, not stopping merely because the owner died. This situation is not different; the same fiscal logic applies. The counter-argument is usually along the lines of \"\"stuff might happen if you rent it out\"\"... true. But the stuff that happens to abandoned houses is much worse, and much more likely: squatters, teen \"\"urban explorers\"\", pot growers, copper thieves, winter pipe freeze flooding and wrecking interiors, etc. Don't take my word on it -- ask your insurer for the cost of insuring an abandoned house vs. a rented one. Renting brings a chunk of cash that comes in from tenants - $12,000/year on a $1000/mo. rental. And that will barely pay the bills if you have a young mortgage on a freshly purchased house at recent market rates. But on an old mortgage, renting is like printing money. That money propagates first to the estate (presumably it is holding back a \"\"fix the roof\"\" emergency fund), and then to the beneficiaries. It means getting annual checks from the estate, instead of constantly being dunned for another repair. But I don't care about making revenue (outside of putting back a kitty to replace the roof). Even if it was net zero, it means the maintenance is being done. This being the point. It is keeping the house in good repair, occupied, insured, and professionally managed -- fit and ready for the bequest's purpose: occupancy of an aunt. What's the alternative? Move an aunt into a house that's been 10 years abandoned? Realistically the heirs are going to get tired/bored of maintaining the place at a total cash loss, maintenance will slip, and you'll be moving them into a neglected house with some serious issues. That betrays the bequest, and it's not fair to the aunts. Rental is a very responsible thing to do. The executor shouldn't fail to do it merely out of passivity. If you decide not to do it, there needs to be a viable alternative to funding the home's decent upkeep. (I don't think there is one). Excluding a revenue-producing asset from the economy is an expensive thing to do.\"" }, { "docid": "544765", "title": "", "text": "\"The whole point of the \"\"envelope system\"\" as I understand it is that it makes it easy to see that you are staying within your budget: If the envelope still has cash in it, then you still have money to spend on that budget category. If you did this with a bunch of debit cards, you would have to have a way to quickly and easily see the balance on that card for it to work. There is no physical envelope to look in. If your bank lets you check your balance with a cell-phone app I guess that would work. But at that point, why do you need separate debit cards? Just create a spreadsheet and update the numbers as you spend. The balance the bank shows is always going to be a little bit behind, because it takes time for transactions to make it through the system. I've seen on my credit cards that sometimes transactions show up the same day, but other times they can take several days or even a week or more. So keeping a spreadsheet would be more accurate, or at least, more timely. But all that said, I can check my bank balance and my credit card balances on web sites. I've never had a desire to check from a cell phone but at least some banks have such apps -- my daughter tells me she regularly checks her credit card balance from her cell phone. So I don't see why you couldn't do it with off-the-shelf technology. Side not, not really related to your question: I don't really see the point of the envelope system. Personally, I keep my checkbook electronically, using a little accounting app that I wrote myself so it's customized to my needs. I enter fixed bills, like insurance premiums and the mortgage payment, about a month in advance, so I can see that that money is already spoken for and just when it is going out. Besides that, what's the advantage of saying that you allot, say, $50 per month for clothes and $100 for gas for the car and $60 for snacks, and if you use up all your gas money this month than you can't drive anywhere even though you have money left in the clothes and snack envelopes? I mean, it makes good sense to say, \"\"The mortgage payment is due next week so I can't spend that money on entertainment, I have to keep it to pay the mortgage.\"\" But I don't see the point in saying, \"\"I can't buy new shoes because the shoe envelope is empty. I've accumulated $5000 in the shampoo account since I went bald and don't use shampoo any more, but that money is off limits for shoes because it's allocated to shampoo.\"\"\"" }, { "docid": "333755", "title": "", "text": "\"There are many different methods for a corporation to get money, but they mostly fall into three categories: earnings, debt and equity. Earnings would be just the corporation's accumulation of cash due to the operation of its business. Perhaps if cash was needed for a particular reason immediately, a business may consider selling a division or group of assets to another party, and using the proceeds for a different part of the business. Debt is money that (to put it simply) the corporation legally must repay to the lender, likely with periodic interest payments. Apart from the interest payments (if any) and the principal (original amount leant), the lender has no additional rights to the value of the company. There are, basically, 2 types of corporate debt: bank debt, and bonds. Bank debt is just the corporation taking on a loan from a bank. Bonds are offered to the public - ie: you could potentially buy a \"\"Tesla Bond\"\", where you give Tesla $1k, and they give you a stated interest rate over time, and principal repayments according to a schedule. Which type of debt a corporation uses will depend mostly on the high cost of offering a public bond, the relationships with current banks, and the interest rates the corporation thinks it can get from either method. Equity [or, shares] is money that the corporation (to put it simply) likely does not have a legal obligation to repay, until the corporation is liquidated (sold at the end of its life) and all debt has already been repaid. But when the corporation is liquidated, the shareholders have a legal right to the entire value of the company, after those debts have been paid. So equity holders have higher risk than debt holders, but they also can share in higher reward. That is why stock prices are so volatile - the value of each share fluctuates based on the perceived value of the entire company. Some equity may be offered with specific rules about dividend payments - maybe they are required [a 'preferred' share likely has a stated dividend rate almost like a bond, but also likely has a limited value it can ever receive back from the corporation], maybe they are at the discretion of the board of directors, maybe they will never happen. There are 2 broad ways for a corporation to get money from equity: a private offering, or a public offering. A private offering could be a small mom and pop store asking their neighbors to invest 5k so they can repair their business's roof, or it could be an 'Angel Investor' [think Shark Tank] contributing significant value and maybe even taking control of the company. Perhaps shares would be offered to all current shareholders first. A public offering would be one where shares would be offered up to the public on the stock exchange, so that anyone could subscribe to them. Why a corporation would use any of these different methods depends on the price it feels it could get from them, and also perhaps whether there are benefits to having different shareholders involved in the business [ie: an Angel investor would likely be involved in the business to protect his/her investment, and that leadership may be what the corporation actually needs, as much or more than money]. Whether a corporation chooses to gain cash from earnings, debt, or equity depends on many factors, including but not limited to: (1) what assets / earnings potential it currently has; (2) the cost of acquiring the cash [ie: the high cost of undergoing a public offering vs the lower cost of increasing a bank loan]; and (3) the ongoing costs of that cash to both the corporation and ultimately the other shareholders - ie: a 3% interest rate on debt vs a 6% dividend rate on preferred shares vs a 5% dividend rate on common shares [which would also share in the net value of the company with the other current shareholders]. In summary: Earnings would be generally preferred, but if the company needs cash immediately, that may not be suitable. Debt is generally cheap to acquire and interest rates are generally lower than required dividend rates. Equity is often expensive to acquire and maintain [either through dividend payments or by reduction of net value attributable to other current shareholders], but may be required if a new venture is risky. ie: a bank/bondholder may not want to lend money for a new tech idea because it is too risky to just get interest from - they want access to the potential earnings as well, through equity.\"" }, { "docid": "128465", "title": "", "text": "Credit is very important even if you are wealthy. One thing you may not realize is that rich people typically have comparatively little cash on hand. If they're smart, most of their assets are not liquid - they're tied up in safe, long-term investments. They use credit for their day-to-day expenses and pay it off from the dividends on their investments (which might only come in once a quarter). There are also tax advantages to using credit. If a rich person wanted a new car, he'd be smarter leasing it for his business (immediate write-off of the lease payments on taxes) versus buying it (depreciation over several years plus property tax liability in some states). There are more elaborate tax dodges but the point is that buying a car outright is the worst option in terms of tax avoidance. Another way the rich (mis) use credit is so that they don't risk their own money on business ventures. Let's say I have $1,000,000 in my personal bank account, and I want to buy a business that costs $1M. If I am dumb, I clean out my bank account and put all my money in the business. I get 100% of the profits, but I also bear 100% of the risk. If I'm smart, I loan 200K of my own money in the business and put the rest someplace safe, and get a loan from a bank for the other 800K. If the business succeeds, the bank gets their money back plus interest. If it fails, the business declares bankruptcy and the bank eats the 800k loss. If I structured the debt right, my personal loan to the failed business gets paid back first when the company is liquidated, and the bank gets whatever is left over (if anything). The most of my own money I can possibly lose is 200k, and probably it's closer to zero if I have a good accountant." }, { "docid": "390066", "title": "", "text": "Mostly ditto Pete B's answer. There's little you can do about closing costs. Some closing costs are government fees. There's nothing you can do about this. Sad and unfair as it is, taxes are not optional and not generally negotiable. Title insurance and fire insurance are required by the lender. Even if you're paying cash, you don't really want to skip on these. If your house burns down and you have no insurance ... well, if you're worried about saving a few hundred on your closing costs, I assume that losing $200,000 because your house burned down and you have no insurance would be a pretty bad thing. Title insurance protects you against the possibility that the seller doesn't really legally own the property, maybe a scam, more likely a mistake or a technicality. You can, and certainly should, shop around for a better deal on insurance. Last couple of housing transactions I made, title insurance was a one-time fee of around $200. (I'm sure this depends on the cost of the house, where you live, maybe other factors.) Maybe by shopping around I could have saved $10 or $20, but I doubt there's someone out there charging $50 when everyone else is charging $200. Fire insurance you're probably paying a couple of thousand a year, more opportunity for savings. Typically the buyer and the seller each have a realtor and they split the fee. If you go without a realtor but the seller hires one, she'll keep the entire fee. So the only way to avoid this expense is if neither of you has a realtor. I've never done that. Realtors cost a ton of money but they provide a useful service: not only helping you find a house but also knowing how to deal with all the paperwork. Plenty of people do it, though. I presume they get the title agency or the bank or somebody to help with the paperwork. There are also discount realtors out there who don't show your home, do little or nothing to market it, basically just help you with the paperwork, and then charge a very low fee. Timing closing for a certain day of the month can reduce what you owe at closing time -- by reducing the amount of interest you pay on the first month's loan payment -- but it doesn't save you any money. You'll make it up over the course of the loan. You might possibly save some money by timing closing around when property taxes are due. Theoretically this shouldn't matter: the theory is that they pro-rate property taxes between buyer and seller so each pays the taxes for the time when they own the house. So again, you might need less cash at closing but you'll make it up the next time property taxes are due. But the formulas the banks use on this are often goofy. Maybe if you live some place with high property taxes this is worth investigating. You could skip the inspection. But inspections I've had done generally cost about $500. If they found something that was a major issue, they might save you from buying a house that would cost tens of thousands in repairs. Or less dramatically, you can use the inspection report for leverage with the seller to get repairs done at the seller's expense. I once had an inspector report problems with the roof and so I negotiated with the seller that they would pay for a percentage of roof repair. I suppose if you're buying a house that you know is run down and will require major work, an inspection might be superfluous. Or if you know enough about construction that you can do an inspection yourself. Otherwise, it's like not buying insurance: sure, you save a little up front, but you're taking a huge risk. So what can you control? (a) Shop around for fire insurance. Maybe save hundreds of dollars. (b) Find a seller who's not using a realtor and then you don't use a realtor either. Save big bucks, 6 to 7% in my area, but you then have to figure out how to do all the paperwork yourself and you severely limit your buying options as most sellers DO use a realtor. Besides that, there's not much you can do." }, { "docid": "415973", "title": "", "text": "Obviously, the best thing financially would be to continue using your present car, unless it impacts you financially on a regular basis. For example, maintenance or breakdowns impacting your ability to work. An unreliable car also impacts your freedom, for example preventing you from taking road-trips you might want to take or taking up free time with maintenance. Give thought to what it is about your present car that you dislike, both to determine the value you gain from a new car and what's most important to you. Anytime you buy a car, you generally lose thousands of dollars simply driving it off the lot. This is the profit which goes to dealers, salespeople, etc... and not part of the actual value of the car. Cars also depreciate over time, with most of the depreciation happening in the first few years of operation. Many of the newer model cars have additional expenses. (For example, replacement $200 keys or electronic systems that can only be repaired at special facilities.) In addition, if you have insurance (other than the minimum third-party required by law), consider the rate increases and add up the long-term impact of that. Imagine you had invested that money instead at 8% interest over the lifetime of the car. If you don't have insurance, consider what you would do in the unfortunate situation where you were at fault in a collision. Could you afford to lose your investment? Even with safe responsible driving, there is always the potential for road/weather conditions or mechanical failures. If you determine there is sufficient value to be gained from changing vehicles, I would recommend that you buy a vehicle with history from someone privately, doing appropriate background checks and consulting friends or family who know about vehicles and can provide feedback. Do research into the models which interest you ahead of time, read online reviews. Every vehicle generally has known advantages and disadvantages which can take years to discover, so buying an older vehicle gives you the advantage of knowing what to expect. I would say there is probably a reasonable middle ground between using a 1991 vehicle you don't like (that's as old as you are) and getting a relatively new model. Look at what you value in the vehicle, consider all the costs, and find the balance that works best for you. Vehicles from 2000-2005 years are quite affordable and still 10-15 years newer than your car." }, { "docid": "194563", "title": "", "text": "\"Here's what my wife and I did. First, we stopped using credit cards and got rid of all other expenses that we absolutely didn't need. A few examples: cable TV, home phone, high end internet - all shut off. We changed our cell phone plan to a cheap one and stopped going out to restaurants or bars. We also got rid of the cars that had payments on them and replaced them with ones we paid cash for. Probably the most painful thing for me was selling a 2 year old 'vette and replacing it with a 5 year old random 4 door. Some people might tell you don't do this because older cars need repairs. Fact is, nearly all cars are going to need repairs. It's just a matter of whether you are also making payments on it when they need them and if you can discipline yourself enough to save up a bit to cover those. After doing all this the only payments we had to make were for the house (plus electric/gas/water) and the debt we had accumulated. I'd say that if you have the option to move back into your parent's house then do it. Yes, it will suck for a while but you'll be able to pay everything off so much faster. Just make sure to help around the house. Ignore the guys saying that this tanks your score and will make getting a house difficult. Although they are right that it will drop your score the fact is that you aren't in any position to make large purchases anyway and won't be for quite some time, so it really doesn't matter. Your number one goal is to dig yourself out of this hole, not engage in activity that will keep you in it. Next, if you are only working part time then you need to do one of two things. Either get a full time job or go find a second part time one. The preference is obviously on the first, which you should be able to do in your spare time. If, for some reason, you don't have the tech skills necessary to do this then go find any part time job you can. It took us about 3 years to finally pay everything (except the house) off - we owed a lot. During that time everything we bought was paid for in cash with the vast majority of our money going to pay off those accounts. Once the final account was paid off, I did go ahead and get a credit card. I made very minor purchases on it - mostly just gas - and paid it off a few days before it was due each month. Every 4 months they increased my limit. After around 18 months of using that one card my credit score was back in the 700+ range and with no debt other than the mortgage. *note: I echo what others have said about \"\"Credit Repair\"\" companies. Anything they can do, you can too. It's a matter of cutting costs, living within your means and paying the bills. If the interest rates are killing you, then try to get a consolidation loan. If you can't do that then negotiate settlements with them, just get everything in writing prior to making a payment on it if you go this route. BTW, make sure you actually can't pay them before attempting to settle.\"" }, { "docid": "264586", "title": "", "text": "\"I guess I don't understand how you figure that taking out a car loan for $20k will result in adding $20k in equity. A car loan is a liability, not an asset like your $100k in cash. Besides, you don't get a dollar-for-dollar consideration when figuring a car's value against the loan it is encumbered by. In other words, the car is only worth what someone's willing to pay for it, not what your loan amount on it is. Remember that taking on a loan will increase your debt-to-income ratio, which is always a factor when trying to obtain a mortgage. At the same time, taking on new debt just prior to shopping for a mortgage could make it more difficult to find a lender. Every time a credit report (hard inquiry) is run on you, it temporarily impacts your credit score. The only exception to this rule is when it comes to mortgages. In the U.S., the way it works is that once you start shopping for a mortgage with lenders, for the next 30 days, additional inquiries into your credit report for purposes of mortgage funding do not count against your credit score, so it's a \"\"freebie\"\" in a way. You can't use this to shop for any other kind of credit, but the purpose is to allow you a chance to shop for the best mortgage rate you can get without adversely impacting your credit. In the end, my advice is to stop looking at how much house you can buy, and instead focus on a house with payments you can live with and afford. Trying to buy the most house based on what someone's willing to lend you leaves no room in the near-term for being able to borrow if the property has some repair needs, you want to furnish/upgrade it, or for any other unanticipated need which may arise that requires credit. Don't paint yourself into a corner. Just because you can borrow big doesn't mean you should borrow big. I hope this helps. Good luck!\"" }, { "docid": "445739", "title": "", "text": "\"How/when does my employer find out? Do they get a report from their bank stating that \"\"check 1234 for $1212.12 paid to John Doe was never deposited\"\" or does it manifest itself as an eventual accounting discrepancy that somebody has to work to hunt down? The accounting department or the payroll company they use will report that the check was not deposited. The bank has no idea that a check was written, but the accounting deportment will know. The bank reports on all the checks that were cashed. Accounting cares because the un-cashed check for $1212.12 is a liability. They have to keep enough money in the bank to pay all the liabilities. It shouldn't be hard for them to track down the discrepancy, they will know what checks are outstanding. Can my employer punish me for refusing the money in this way? Do they have any means to force me to take what I am \"\"owed?\"\" They can't punish you. But at some time in the future they will will tell their bank not to honor the check. They will assume that it was lost or misplaced, and they will issue a new one to you. When tax time comes, and I still have not accepted the money, would it be appropriate to adjust my reported income down by the refused amount? You can't decide not to report it. The company knows that in year X they gave you a check for the money. They are required to report it, since they also withheld money for Federal taxes, state taxes, payroll taxes, 401K, insurance. They also count your pay as a business expense. If you try and adjust the numbers on the W-2 the IRS will note the discrepancy and want more information. Remember the IRS get a copy of every W-2. The employer has to report it because some people who aren't organized may not have cashed a December check before the company has to generate the W-2 in late January. It would confuse everything if they could skip reporting income just because a check wasn't cashed by the time they had to generate the W-2.\"" }, { "docid": "116545", "title": "", "text": "There are, of course, many possible financial emergencies. They range from large medical expenses to losing your job to being sued to major home or car repairs to who-knows-what. I suppose some people are in a position where the chances that they will face any sort of financial emergency are remote. If you live in a country with national health insurance and there is near-zero chance that you will have any need to go outside this system, you are living with your parents and they are equipped to handle any home repairs, you ride the bus or subway and don't own a car so that's not an issue, etc etc, maybe there just isn't any likely scenario where you'd suddenly need cash. I can think of all sorts of scenarios that might affect me. I'm trying to put my kids through college, so if I lost my job, even if unemployment benefits were adequate to live on, they wouldn't pay for college. I have terrible health insurance so big medical bills could cost me a lot. I have an old car so it could break down any time and need expensive repairs, or even have to be replaced. I might suddenly be charged with a crime that I didn't commit and need a lawyer to defend me. Etc. So in a very real sense, everyone's situation is different. On the other hand, no matter how carefully you think it out, it's always possible that you will get bitten by something that you didn't think of. By definition, you can't make a list of unforeseen problems that might affect you! So no matter how safe you think you are, it's always good to have some emergency fund, just in case. How much is very hard to say." }, { "docid": "506194", "title": "", "text": "\"In general, if you can afford to replace something, you are able to \"\"self-insure\"\". You really want to understand a little of the statistics before you can make a generic call, but my rule of thumb is that insurance via \"\"extended warranty\"\" is rarely a good deal. Here is a simple expected value math formula you can apply (when the > is true, then you should buy it): replacement cost x likelihood of using warranty % > cost of insurance You can then back-compute, what is the likelihood that I'd need to lose this item to break even? Given your numbers: $2000 x Y > $350 or Y > (350/2000) or Y > 17.5% So if you think there is a 17.5% or greater chance that you'll need to have you system replaced (i.e. not just a simple fix) AND (as Scott pointed out) you'll be able to actually use the replacement warranty then the applecare is a good purchase. Note, this only applies to items you can replace out-of-pocket without significant burden, because if you didn't have the $10k to replace your car, it wouldn't matter if the insurance wasn't such a good deal (especially if you need the car to get to work, etc.) So the obvious question is: \"\"Why would a for-profit company ever offer insurance on something they are statistically likely to lose money on?\"\" The obvious answer is \"\"they wouldn't,\"\" but that doesn't mean you should never buy this type of insurance, because you may have statistically significant circumstances. For instance, I purchased a $40 remote helicopter as a gift for my children. I also paid the $5 for a \"\"no questions asked\"\" warranty on it because, knowing my kids, I knew there was a nearly 100% chance they would break it at least once. In this case, this warranty was well worth the $5, because they did break it! Presumably they make money on these warranties because most of the purchasers of the plan are more attentive (or too lazy to make the claim) than in this case. Edit note: I incorporated Scott's comment about likelihood of being able to utilize the warranty into a combined \"\"likelihood of using warranty\"\" term. This term could be broken up into likelihood of needing replacement x likelihood of actually getting company to replace it I didn't do this above because it makes it a little harder to understand, and may not be a major factor in all cases, but you can definitely add it after the fact (i.e. if there's only a 90% chance Applecare will pay out at all, then divide the 17.5% by 0.9 to get 19.4% likelihood of needing the replacement for it to be cost effective). More complete formulas can be derived also (including terms for full replacement costs vs repair costs and including terms for \"\"deductible\"\" type costs or shipping), but I'm trying to keep things relatively simple for those who aren't statistics nerds like I am.\"" }, { "docid": "519950", "title": "", "text": "Presumably you need a car to get to work, so let's start with the assumption that you need to buy something to replace the car you just lost. The biggest difficulty to overcome in buying a car is the concept of the monthly payment. Dealers will play games with all of the numbers to massage a monthly payment that the buyer can swallow, but this usually doesn't end up giving the customer the best deal. The 18 month term is not normal for a lease, typically you'll see 24 or 36 months. You are focusing on another goal of paying your student loans by then which would free up much more money for other wants (like a car) but at what cost? The big difficulty of personal finance is the mental mind game of delaying gratification for greater long-term benefit. You are focusing on paying your student loans now so that you can be free of that debt and have more flexibility for the future. Good. You're tempted to spend another $5400 (assuming no down-payment or other surprise fees) to drive a car for 18 months. That doesn't sound any wiser than $5,000 for an unreliable used car that gave you more problems than you bargained for. Presumably you got some percentage of that money back from the insurance company when the car was totaled, but even if not, the real lesson should be finding a car that you can afford up-front, but also one that you can still use when the loan is paid off (like your education--that investment will keep giving even when the loans are a distant memory). My advice would be to look for a car that has about 30k miles on it and pay for it as quickly as possible, then drive it at least for 70-120k more miles before replacing it. You may wish for a newer car, especially in 3 or 4 more years when it starts to show its age, but you'll also thank yourself when you can buy a newer better car with cash and break out of the monthly payment game that dealers try to push on you. You might even enjoy negotiating with car salesmen when you see through their manipulations and simply work for the best cash price you can get." } ]

[ { "docid": "45078", "title": "", "text": "You probably can't deposit the check directly, but there are mechanisms in place to get your money through other means. In the US, all states and territories have an unclaimed property registry. Before you contact the company that wrote the check, you should check that registry in your state. You will have to provide proof that you are the intended recipient, having the original check in your possession should make that considerably easier." } ]

[ { "docid": "411536", "title": "", "text": "I like your question and think it is a pretty good one. Generally speaking I would not suggest talking about your stock picks or wealth. Here is why: 1) Most people are broke. Seventy-eight percent of the US population report living paycheck to paycheck. More than a majority do not have enough in savings to cover a $500 repair to a car or dryer. What kind of money advice will you get from broke people (the general population)? Answer: Bad. 2) It targets you for jealousy/negative feelings. If you discuss this kind of thing with your broke friends they will have negative feelings toward you. This is not necessarily a bad thing. If you want to build wealth a aspect of that is having wealthy friends. They will have the kind of disposable income to do the kinds of things you want to do. They can alert you to good investment opportunities. And your income will tend to increase. Most people's income resides within 10% of their 10 closest friends. 3) You can be targeted for law suits. Given that personal injury attorneys work on contingent, they are very good at picking on defendants with deep pockets or really good insurance. Knowing that you have significant investments will put a bit of a target on your back. Having said all of that, you could participate in groups with a similar interest in investing. Back in the late 80's investment clubs were all the rage, and you might be able to find one of those online or at the local library or something. That would be a far safer." }, { "docid": "116914", "title": "", "text": "\"It's also not really anything new. For a several decades, a huge percentage of the population has been essentially living paycheck-to-paycheck, and with essentially zero cash savings to cover emergencies. It's possible that it is slightly worse now in the sense that -- with the pervasive use of credit &amp; debit cards, etc -- few people deal in cash or change very often ... and so they don't even have the old proverbial \"\"piggy banks\"\" (or jars/bottles filled with end-of-day pocket-change) that they can raid for $50 or $100. *Oh, and THAT really has nothing to do with \"\"bubbles\"\".* --- EDIT: Plus another thought... just the other day there was an article crowing about how Millennials are \"\"saving for retirement\"\" in higher amounts and at earlier ages than prior generations -- if that is true, then a likely corollary would be that they are NOT engaged in plain old \"\"savings\"\" at the same rate -- i.e. what money they are \"\"stashing away\"\" is all heading to Wall Street, and is difficult to access in an emergency (and if they did access 401k savings, it would likely be as a \"\"loan\"\" -- rather than paying the early-withdrawal penalties &amp; taxes).\"" }, { "docid": "366307", "title": "", "text": "If they leave the extra funds in the account the IRS will consider it as employer match. They weren't funds from your paycheck, they were from the employers profits. Because they don't have a formal matching program the extra funds will still keep then under the max match. There is one other explanation that needs to be considered. If the last paycheck from 2011 was near the end of the year (the last Friday of 2011 was December 30th) the 401K funds from that final paycheck may not have been deposited into your 401K until early January 2012. If you count contributions when looking at your 401K statement it will look like one two many for 2012; but the IRS only cares when it was deducted from your paycheck, not when it was deposited into your account. The Department of Labor only requires they be deposited by the 15th of the following month." }, { "docid": "89888", "title": "", "text": "The Fair Credit Reporting Act (FCRA) says that account history will stay on your credit report as a closed account for 7 years, and then it will drop off, just like any other bad or good mark on your credit (aside from bankruptcies which stay on reports for 10 years, and can be asked about for the rest of your life). The presence of a new credit card will do more to lower your score in the short term than closing an old credit card. On a related note, reporting a card as lost or stolen can also show up as a different, closed account, even if you keep the same account open with the creditor." }, { "docid": "132657", "title": "", "text": "What would you do if you had the check? Probably destroy it. The goal is to render it uncashable. One way to do such is to have it shredded. If you are uncomfortable leaving them to destroy it, then swing by and pick it up. Alternatively offer to send them a self addressed and stamped envelope. I am sure they will accommodate if you ask nicely." }, { "docid": "57402", "title": "", "text": "\"Not going to happen anytime soon. These old fatties won't go down without a bitter fight that will make us really hate them for a while longer. New media (e.g. Netflix, youtube, Hulu...) still requires an internet connection. As it stands, the avenue to get connected to these services still goes through cable companies (e.g. Time Warner, Comcast, Cox...) or through telecom companies (e.g. ATT and Verizon). The first step these antiquated orgs. will pull is putting caps on our internet usage. This will take the floor right from under online video services, which have worked off an \"\"all you can eat\"\" broadband model. Right now caps are at something like 100-250GB, which seems like a lot. But imagine you replace your entire cable consumption with online consumption. Plus add in any other internet activity like games and downloads, 250GB may be a bit closer than you think. Moreover, ISPs are moving to lower the caps on internet usage, probably around 50GB, which limits us even further on online media consumption. So because they *cannot* compete with these services, they aim to stop us entirely from using them. Bully tactics, not good business through adaption and innovation. They think by doing this, they will drive consumers back to their traditional services. Time will tell if the masses will play into their hand or actually shape demand for a non-restrictive, non-cable sourced ISP. Should such a service arise, cable companies are pretty much dead in the next 5-10 years. As it stands, we still require cable companies to deliver our content. The battle between Old Media and New Media will be hard fought and we, the consumers, stand to get the brunt of this battle for a while longer.\"" }, { "docid": "464753", "title": "", "text": "\"As others have said, doing a monthly budget is a great idea. I tried the tracking expenses method for years and it got me nowhere, I think for these reasons: If budgeting isn't your cup of tea, try the \"\"pay yourself first\"\" method. Here, as soon as you get a paycheck take some substantial portion immediately and use it to pay down debt, or put it in savings (if you have no debt). Doing this will force you to spend less money on impulse items, and force you to really watch your spending. If you take this option, be absolutely sure you don't have any open credit accounts, or you'll just use them to make up the difference when you find yourself broke in the middle of the month. The overall key here is to get yourself into a long term mind set. Always ask yourself things like \"\"Am I going to care that I didn't have this in 10 years? 5 years? 2 months? 2 days even? And ask yourself things like \"\"Would I perfer this now, or this later plus being 100% debt free, and not having to worry if I have a steady paycheck\"\". I think what finally kicked my butt and made me realize I needed a long term mind set was reading The Millionaire Next Door by Tom Stanley. It made me realize that the rich get rich by constantly thinking in the long term, and therefore being more frugal, not by \"\"leveraging\"\" debt on real estate or something like 90% of the other books out there tell you.\"" }, { "docid": "396010", "title": "", "text": "\"I disagree with @Sam's answers: yes you will get that money back when your tax return is processed. This is not true. You will receive funds that are in excess of your liability (contrary to popular belief, the government does not take more than what you are liable for). \"\"is it possible to return the check and modify how it's calculated if I talk to payroll?\"\" No. When you sign your documents at the beginning of the year, that will dictate the amount of liability they take from each of your paychecks. \"\"Will this difference be given back in my next tax return\"\" Because your company is withdrawing 25% on your paycheck you may/or may not need to pay more depending on the rest of your salary. The IRS has set the system up as brackets. You pay your taxes based on the amount earned (voluntarily or involuntarily). So if you have income of $9,275 you would pay $923 in taxes at a marginal rate of 10% (and average rate of 10%). If you made $10,000, you would pay $923+$109=$1,032 with your marginal rate as 15% (while your average rate is 10.31%). All in all, this is dependent on your salary, filing, and other deductions to raise or lower your tax liability. Note: The $109 came from this: [(10,000-9,275)*.15]\"" }, { "docid": "389028", "title": "", "text": "Even with a good investment strategy, you cannot expect more than 8-10% per year in average. Reducing this by a 3% inflation ratio leaves you with 5 - 7%, which means 15k$ - 21k$. Consider seriously if you could live from that amount as annual income, longterm. If you think so, there is a second hurdle - the words in average. A good year could increase your capital a bit, but a bad year can devastate it, and you would not have the time to wait for the good years to average it out. For example, if your second year gives you a 10% loss, and you still draw 15k$ (and inflation eats another 3%), you have only 247k$ left effectively, and future years will have to go with 12k$ - 17k$. Imagine a second bad year. As a consequence, you either need to be prepared to go back to work in that situation (tough after being without job for years), or you can live on less to begin with: if you can make it on 10k$ to begin with (and do, even in good years), you have a pretty good chance to get through your life with it. Note that 'make it with x' always includes taxes, health care, etc. - nothing is free. I think it's possible, as people live on 10k$ a year. But you need to be sure you can trust yourself to stay within the limit and not give in and spent more - not easy for many people." }, { "docid": "221285", "title": "", "text": "No. I have partaken of but not lately. It's only become non-taboo here in the last 10 years and I was raised to think it was bad and people who do it are slackers or lazy and the like. I've thankfully grown out of that old way of thinking and now know how profitable it is and feel this is a good venture to begin building a nice portfolio. I'd also like to get into real estate and solar and wind as well" }, { "docid": "422484", "title": "", "text": "\"Time-Barred Debts and STATE STATUTES OF LIMITATION ON COLLECTING DEBTS are good places to start on the issues of what can be collected and for how long. What seems to be at issue is bankruptcy vs. time-barred debts vs. what creditors (original debt owners, not collection agencies or those who buy debt) can do. You should also check out The Fair Credit Reporting Act which governs some of the question. The Fair Credit Reporting Act and the section on time-barred debts applies to collection agencies, etc. (so-called debt owners as pointed out by @littleadv, since they buy debt from the creditors) not actual creditors (those the debt is/was originally owed to). Creditors (those to whom the debt was originally owed) have different rules than debt collectors and can do things debt collectors can't. State law generally governs what creditors, as original owners of the debt, can do legally and for how long. Bankruptcy Bankruptcy is a legal action that frees someone from paying all or part of debt owed (they are crying \"\"Uncle!\"\" and stating they don't have enough money to pay their creditors). On a credit report, accounts will generally be updated to show “included in bankruptcy\"\" or similar. Debt that is determined to still be owed often will be reduced in amount/payments. Time-barred Debts Time-barred debts are debts that are still owed, but cannot be collected through direct legal action (suing). Each state has its own statute of limitations on how long different types of debt can be collected by suing after initial default before being considered time-barred. This period is typically 3-6 years but a few states such as Kentucky allow much longer time periods (up to 15 years). Being a time-barred debt does NOT prevent a collector from contacting someone about a debt. Collectors can still try to collect a debt forever -- and probably will -- but they can't normally sue and collect payment once the statute of limitations period has passed. There are gotchas with time-barred debts regarding collection, however, which can make them still legally actionable. Making any payment, no matter how small, making a verbal commitment to pay or even acknowledging the time-barred debt is often enough to make the debt legally collectable, even if it would normally be past the statute of limitations for collection. This is again state-dependent, but it is a pitfall for many people. The process of making a debt collectable again is often called \"\"re-aging\"\". Re-aging essentially means the clock starts anew on the statute of limitations, extending the time that a creditor may use the courts to collect that debt. If someone is taken to court over a time-barred debt that is legally noncollectable (has not been legally re-aged), nothing happens to them. However, being time-barred does not prevent legal action in the sense that you still have to prove the debt is time-barred and noncollectable in court if your sued over it. Being time-barred does not mean the debt \"\"dissolves\"\". A debt is always owed unless the debt has been forgiven or discharged in bankruptcy court. This means that, combined with the ability of debt collectors to contact someone about out of statute debt and the pitfalls of re-aging, it is entirely possible for a debt collector to get a 20 year old debt actionable again. Also note that while someone is trying to dodge a debt to make it time-barred (e.g. by not paying anything), creditors and debt collectors can still take legal action to sue over the debt, and if they get a judgment against someone, this can extend the debt indefinitely. Judgements will eventually lapse, but often only after 10 years or more, and many states allow dormant judgements to be \"\"revived\"\" within that time period. Credit Reports Regarding credit reports, whether someone owes a debt and whether it appears on a credit report are two separate things. As previously stated, no debt \"\"dissolves\"\" or goes away unless some sort of legal action makes it so. As far as reporting is concerned, however, most \"\"bad\"\" credit stops being reported after seven years (by federal law). That is, accounts on a credit report will be deleted seven years from the original delinquency dates of the accounts regardless of being included in bankruptcy or as time-barred debt. This assumes no legal process allows the account to continue being reported (as is often the case with re-aging). As an FYI, a bankruptcy discharge date has nothing to do with when account information will be removed from your credit report. Note that some debts, such as tax liens, can be reported indefinitely. Should bankruptcy be considered? The decision to do bankruptcy is mostly a matter of how severe the debt is. If it is an extremely large amount and assets are very small, bankruptcy is a good route in so far as it will legally take care of a lot of loose ends and likely relieve most or all of the burden of actually owing the money. Credit-wise, 10 years is the maximum a bankruptcy (specifically) will appear on a credit report. Accounts may drop off a credit report before bankruptcy because they are past the seven years they can be legally reported. Debts owed to the state such as child support, student loans, income tax, etc. generally cannot be written off and aren't subject normal debt statute of limitations on collection. Finally, bad credit is bad credit -- there is likely to be little difference in terms of ability to get loans between bankruptcy and attempting to dodge legal action to make debts time-barred. If the debt is significant, bankruptcy may be the only sensible option.\"" }, { "docid": "46318", "title": "", "text": "I love Netflix, but mostly for the documentaries. I miss the old History Channel and then later H2 when they were full of documentaries and actually educational and interesting programming. Now they're just reality television like the rest of the crap on cable. While I don't mind the occasional Disney film or other movie on Netflix, I usually still like to own physical copies of movies(like Star Wars) and if I don't care enough to own it, I usually don't care enough to watch it. This doesn't really affect my streaming decisions at all. I still have Amazon Prime(which I've had for over 10 years now because of the 2 day shipping, don't watch much on their streaming service but I have it on my Roku). TBH I can see where Disney may lose money, because I for one have to really want to see something to buy a copy, and I don't care enough about most of their stuff to pay for a streaming sub specifically for their content. In closing, this wont make me pay for their stuff or pirate it, I simply wont watch it(besides seeing Star Wars films in the theater and/or buying the Blu-ray). I suppose I should catch up on what I'd like to see of theirs on Netflix before they remove it all in a year or two." }, { "docid": "539008", "title": "", "text": "I dont get people, i have my mortgage and that's it, 4% locked in for 10 years and dropping fast, my cousin, a couple months ago (since the rates are so low !!) refinanced her house to buy a brand new car. But she still is paying her old car, witch she traded in for the new one. I dont get people." }, { "docid": "20304", "title": "", "text": "To be honest, all that they might be able to tell you is to keep saving. Your income seems like it will vary week to week thanks to commission (and I'm still very curious how at 18 you found a job making $96,000 a year at minimum). Right now because you have no savings, start stacking that up. You're going to want an emergency fund on the side as well. Even though now you may still live with parents, you still may run into issues where you'll need money on hand. It's much better to dig into an emergency fund than get a loan. Plus, when moving out, you won't be living paycheck to paycheck. Best rule of thumb for this is to keep an emergency fund of roughly 3-6 months of expenses. Right now because you're so young with so little money, there isn't a large reason to really open up an IRA or any sort of investment account. Unless you're actually guaranteed $2,000 a week, then things are different." }, { "docid": "235708", "title": "", "text": "\"Yeah the biggest problem with this is that it far more heavily taxes the poor than the rich. Poor people spend *all of their income.* Month-to-month, living paycheck-to-paycheck, poor people have no choice but to spend their entire incomes on basic necessities, utilities, etc. Rich people on the other hand spend very little of their incomes. Most of it gets stashed in hedgefunds and overseas holdings and doesn't really \"\"change hands\"\" in a way that allows it to be taxed under this style of tax structure. So your tax continuously hits 100% of the wealth of the bottom 75%(ish) of households while largely bypassing the rich folks who have more money than they can *spend*. In short, this kind of tax structure is really bad for anyone who doesn't make $300k+ a year and store most of their wealth in stocks and so forth. If you want to help the general public (households making less than $300k/year), you need to generate more tax revenue from *investments* and *capital gains*. A 2% tax, say, on stock trades valued over $10,000 obviously wouldn't hurt poor people at all, and also wouldn't really hurt the rich. Cuz if you've got 10 grand (or a hundred, or thousand, or whatever) to stash in shares of Amazon or whatever, you're really not gonna miss the $200 that comes off the top of your trade. But this *would* generate huge tax revenue, as there are thousands of such transfers a day.\"" }, { "docid": "445994", "title": "", "text": "Yes, you can do what you are contemplating doing, and it works quite well. Just don't get the university's payroll office too riled by going in each June, July, August and September to adjust your payroll withholding! Do it at the end of the summer when perhaps most of your contract income for the year has already been received and you have a fairly good estimate for what your tax bill will be for the coming year. Don't forget to include Social Security and Medicare taxes (both employee's share as well as employer's share) on your contract income in estimating the tax due. The nice thing about paying estimated taxes via payroll deduction is that all that tax money can be counted as having been paid in four equal and timely quarterly payments of estimated tax, regardless of when the money was actually withheld from your university paycheck. You could (if you wanted to, and had a fat salary from the university, heh heh) have all the tax due on your contract income withheld from just your last paycheck of the year! But whether you increase the withholding in August or in December, do remember to change it back after the last paycheck of the year has been received so that next year's withholding starts out at a more mellow pace." }, { "docid": "124593", "title": "", "text": "In addition to the already good answers you also want to consider your time horizon. Unless you are looking out 10+ years, building your down payment in an account that is invested in the market is probably subject to too much market risk. Are you willing to delay purchasing a home by five years if the market turns down at the wrong time? A better option is to just use a savings accounts. To avoid spending the money, you can open a dedicated account. Separate savings account for a special purpose are s common feature at credit unions and probably are available at many regular banks as well. Then for funding the account, many employers allow you to split direct deposits amongst multiple accounts, so you will just need to provide the routing number and fractional amount of your paycheck for that account." }, { "docid": "592780", "title": "", "text": "How realistic is it that I will be able to get a home within the 250,000 range in the next year or so? Very unlikely in the next year. The debt/income ratio isn't good enough, and your credit score needs to show at least a year of regular payments without late or default issues before you can start asking for mortgages in this range. You don't mention how long you've been employed at these incomes, this can also count against you if you haven't both been employed for a full year at these incomes. They will look even more unfavorably on the employment situation if they aren't both full time jobs, although if you have a full year's worth of paychecks showing the income is regular then that might mitigate the full time/part time issue. next year or so? If you pay down your high interest debt (car, credit cards), and maintain employment (keep your check stubs and tax returns, the loan officer will want copies), then there's a slight chance. And, from this quick snap shot of our finances, does it look like we would be able to qualify for a USDA loan? Probably not. Mostly for the same reasons - the only time a USDA loan helps is when you would be able to get a regular loan if you had the down payment. Even with an available down payment of 50k, you wouldn't be able to get a regular loan, therefore it's unlikely that you'd qualify for a USDA loan. If you are anxious to get into a house, choose something much smaller, in the 100k-150k range. It would improve your debt/loan ratio enough that you might then qualify for a USDA loan. However, I think you'd still have issues if you haven't both been employed at this rate of income for at least a year, and have made regular payments on all your debts for at least a year. I'll echo what others have suggested, though, strengthen your credit, eliminate as much of your high interest debt as you can (car, credit cards), and keep your jobs for a year or two. Start a savings plan so you can contribute a small down payment - at least 3-5% of the desired home price - when you are in a better position to buy. During this time keep track of your paycheck stubs, you may need them to prove income over the time period your loan officer will request. Note that even with a USDA loan you still have to pay closing costs, and those can run several thousand dollars, so don't expect to be able to come to the table with no cash. Lastly, there's good reason to be very conservative regarding house cost and size. If you can, consider buying the house as if you only had the 46k per year. Move the debt to the person making the lower income, and if you buy the house in the name of the person only making 46k per year, then the debt/loan ratio looks very positive. Further it may be that the credit history of that person is better, and the employment history is better. If one of you has better history in these ways, then you might have a better chance if only one of you buys the house. Banks can't tell you about this, but it does work. Keep in mind, though, that if you two part ways it could be very unhappy since one would be left with all the debt and the house would be in the other's name. Not a great situation to be in, so make sure that you both carefully consider the risks associated with the decisions made." }, { "docid": "416606", "title": "", "text": "\"I'm going to ignore your numbers to avoid spending the time to understand them. I'm just going to go over the basic moving parts of trading an upside down car against another financed car because I think you're conflating price and value. I'm also going to ignore taxes, and fees, and depreciation. The car has an acquisition cost (price) then it has a value. You pay the price to obtain this thing, then in the future it is worth what someone else will pay you. When you finance a car you agree to your $10,000 price, then you call up Mr. Bank and agree to pay 10% per year for 5 years on that $10,000. Mr. Banker wires over $10,000 and you drive home in your car. Say in a year you want a different car. This new car has a price of $20,000, and wouldn't you know it they'll even buy your current car from you. They'll give you $7,000 to trade in your current car. Your current car has a value of $7,000. You've made 12 payments of $188.71. Of those payments about $460 was interest, you now owe about $8,195 to Mr. Banker. The new dealership needs to send payment to Mr. Banker to get the title for your current car. They'll send the $7,000 they agreed to pay for your car. Then they'll loan you the additional $1,195 ($8,195 owed on the car minus $7,000 trade in value). Your loan on the new car will be for $21,195, $20,000 for the new car and $1,195 for the amount you still owed on the old car after the dealership paid you $7,000 for your old car. It doesn't matter what your down-payment was on the old car, it doesn't matter what your payment was before, it doesn't matter what you bought your old car for. All that matters is how much you owe on it today and how much the buyer (the dealership) is willing to pay you for it. How much of this is \"\"loss\"\" is an extremely vague number to derive primarily because your utility of the car has a value. But it could be argued that the $1,195 added on to your new car loan to pay for the old car is lost.\"" } ]

[ { "docid": "158122", "title": "", "text": "The only professional designations for people allowed to provide tax advice are Attorney, EA or CPA. Attorney and CPA must be licensed in the State they practice in, EA's are licensed by the Federal government. Tax preparers are not allowed to provide any tax advice, unless they hold any of these designations. They are only allowed to prepare your tax forms for you. So no, tax preparer is not a solution. Yes, you need to talk to a tax adviser (EA/CPA licensed in your State, you probably don't need a tax attorney). You should do that before you start earning money - so that you can plan properly and understand what expenses you can incur and how they're handled with regards to your future income tax payments. You might also want to consider a bookkeeping service (many EA/CPA offices offer the bookkeeping as well). But that you can also do yourself, not all that complicated if you don't have tons of transactions and accounts." } ]

[ { "docid": "77088", "title": "", "text": "Well, to get money, you need to leverage your assets. So your options basically are: - Asset: Cash. Well, I figure if you had, you wouldn't have asked how to get more of it, but its always worth mentioning. Don't forget about cash that can be in tricky places to tap, like 401ks, IRAs, investment accounts, etc. There is usually some way to get at the cash, but it may not be worth it and you could end up sacrificing long term financial stability if you do. - Asset: Job Skills and Initiative. Get a job and and earn the cash. $2k is not a ton, and if you live frugally you should be able to save it. There are tons of websites dedicated to living frugally and earning extra cash on the side. My personal favorite is r/beermoney. - Asset: Good Credit. Borrow the money from a traditional bank. Signature loans go up to $35k at most banks, just ask what it would take to qualify. You could also get a credit card for that amount, and use it to start up the business. - Asset. Bad Credit. If you've got bad credit, you can still take out a loan from a place like Prosper or Lending Club or Sofi (these places are handy if you have good credit, too). Your rates will be much higher, but they will still lend to you. - Asset: Property. If you own stuff, you can sell it and get cash. Clean out your attic (or ask relatives if you can have the stuff in theirs!) and sell it. If you own fancy stuff, you can borrow against it (home, car, boat, etc.). - Asset: Your Charm and Winning Smile. If you have a good, solid business plan (written down and professional looking), ask around and see if you can find an investor. It could be friends or family, but it could also be someone who is looking to invest. Be professional, and be sure to draw up the appropriate business docs if you do a partnership or take a private loan. - Asset: Your Government. If you live in the US, there are federal programs that offer Small Business Loans. Check out sba.gov for more info. You will need a business plan and will have to meet the criteria of the loan or grant. Not sure if your Ecommerce business will meet the criteria, as the intent of these types of programs are to spur the economy by allowing small business owners to hire workers. But its worth checking out." }, { "docid": "193367", "title": "", "text": "\"Be careful here: If ACME were in California, I would pay taxes on USD 17,000 because I had revenue of 20,000 and expenses of 3,000. To CALIFORNIA. And California taxes S-Corps. And, in addition, you'd pay $800 for the right of doing business in the State. All that in addition to the regular Federal and State taxes to the State where you're resident. Suppose that ACME is in Britain (or anywhere else for that matter). My revenue and expenses are the same, but now my money has been earned and my expenses incurred in a foreign country. Same thing exactly. Except that you'll have to pay taxes to the UK. There may be some provision in the tax treaty to help you though, so you may end up paying less taxes when working in the UK than in California. Check with a licensed tax adviser (EA/CPA licensed in your State) who won't run away from you after you say the words \"\"Tax Treaty\"\". Does it even make sense to use my S-Corporation to do business in a foreign country? That should be a business decision, don't let the tax considerations drive your business.\"" }, { "docid": "40044", "title": "", "text": "You may also want to consider Delaware and Nevada as possible corporate homes. They are common choices for out of state corporations. You may find that they are better options. Will earnings prior to forming the LLC have to be claimed as self-employment income? If so, would it be easier to wait until the next calendar year to form the LLC? Earnings after forming the Limited Liability Corporation (LLC) will probably have to be claimed as self-employment income. See How LLC Members Are Taxed for more discussion. In particular, read the section on self-employment taxes: The current rule is that any owner who works in or helps manage the business must pay this tax on his or her distributive share (rightful share of profits). However, owners who are not active in the LLC -- that is, those who have merely invested money but don't provide services or make management decisions for the LLC -- may be exempt from paying self-employment taxes on their share of profits. The regulations in this area are a bit complicated, but if you actively manage or work in your LLC, you can expect to pay self-employment tax on all LLC profits allocated to you. As I read it, you actively work in the LLC, so it is unlikely that you can avoid paying self-employment taxes. So it shouldn't make any difference when you officially start an LLC. You'll have to pay self-employment taxes before and after creating the LLC regardless. If you don't want to pay self-employment taxes, you may want to consider forming a Subchapter C corporation. They don't have the same tax structure as Subchapter S corporations or LLCs. You would be paid some kind of wage, salary, or commission and the corporation would pay the employer's side of the payroll taxes. Note that Subchapter S corporations and LLCs exist because they usually pay less in tax than Subchapter C corporations do. Even including the self-employment taxes that you owe. A CPA should be able to guide you in making these decisions and help you with setup. The one time that I started a corporation, I just paid a few hundred dollars to a service and they filed the paperwork for me. That included state fees and notice costs. The CPA probably has a service association already." }, { "docid": "595427", "title": "", "text": "\"It sounds like the kinds of planners you're talking to might be a poor fit, because they are essentially salespersons selling investments for a commission. Some thoughts on finding a financial planner The good kind of financial planner is going to be able to do a comprehensive plan - look at your whole life, goals, and non-investment issues such as insurance. You should expect to get a document with a Monte Carlo simulation showing your odds of success if you stick to the plan; for investments, you should expect to see a recommended asset allocation and an emphasis on low-cost no-commission (commission is \"\"load\"\") funds. See some of the other questions from past posts, for example What exactly can a financial advisor do for me, and is it worth the money? A good place to start for a planner might be http://napfa.org ; there's also a franchise of planners providing hourly advice called the Garrett Planning Network, I helped my mom hire someone from them and she was very happy, though I do think your results would depend mostly on the individual rather than the franchise. Anyway see http://www.garrettplanningnetwork.com/map.html , they do require planners to be fee-only and working on their CFP credential. You should really look for the Certified Financial Planner (CFP) credential. There are a lot of credentials out there, but many of them mean very little, and others might be hard to get but not mean the right thing. Some other meaningful ones include Chartered Financial Analyst (CFA) which would be a solid investment expert, though not necessarily someone knowledgeable in financial planning generally; and IRS Enrolled Agent, which means someone who knows a lot about taxes. A CPA (accountant) would also be pretty meaningful. A law degree (and estate law know-how) is very relevant to many planning situations, too. Some not-very-meaningful certifications include Certified Mutual Fund Specialist (which isn't bogus, but it's much easier to get than CFP or CFA); Registered Investment Adviser (RIA) which mostly means the person is supposed to understand securities fraud laws, but doesn't mean they know a lot about financial planning. There are some pretty bogus certifications out there, many have \"\"retirement\"\" or \"\"senior\"\" in the name. A good question for any planner is \"\"Are you a fiduciary?\"\" which means are they legally required to act in your interests and not their own. Most sales-oriented advisors are not fiduciaries; they wouldn't charge you a big sales commission if they were, and they are not \"\"on your side\"\" legally speaking. It's a good idea to check with your state regulators or the SEC to confirm that your advisor is registered and ask if they have had any complaints. (Small advisors usually register with the state and larger ones with the federal SEC). If they are registered, they may still be a salesperson who isn't acting in your interests, but at least they are following the law. You can also see if they've been in trouble in the past. When looking for a planner, one firm I found had a professional looking web site and didn't seem sketchy at all, but the state said they were not properly registered and not in compliance. Other ideas A good book is: http://www.amazon.com/Smart-Simple-Financial-Strategies-People/dp/0743269942 it's very approachable and you'd feel more confident talking to someone maybe with more background information. For companies to work with, stick to the ones that are very consumer-friendly and sell no-load funds. Vanguard is probably the one you'll hear about most. But T. Rowe Price, Fidelity, USAA are some other good names. Fidelity is a bit of a mixture, with some cheap consumer-friendly investments and other products that are less so. Avoid companies that are all about charging commission: pretty much anyone selling an annuity is probably bad news. Annuities have some valid uses but mostly they are a bad deal. Not knowing your specific situation in any detail, it's very likely that 60k is not nearly enough, and that making the right investment choices will make only a small difference. You could invest poorly and maybe end up with 50K when you retire, or invest well and maybe end up with 80-90k. But your goal is probably more like a million dollars, or more, and most of that will come from future savings. This is what a planner can help you figure out in detail. It's virtually certain that any planner who is for real, and not a ripoff salesperson, will talk a lot about how much you need to save and so forth, not just about choosing investments. Don't be afraid to pay for a planner. It's well worth it to pay someone a thousand dollars for a really thorough, fiduciary plan with your interests foremost. The \"\"free\"\" planners who get a commission are going to get a whole lot more than a thousand dollars out of you, even though you won't write a check directly. Be sure to convert those mutual fund expense ratios and sales commissions into actual dollar amounts! To summarize: find someone you're paying, not someone getting a commission; look for that CFP credential showing they passed a demanding exam; maybe read a quick and easy book like the one I mentioned just so you know what the advisor is talking about; and don't rush into anything! And btw, I think you ought to be fine with a solid plan. You and your husband have time remaining to work with. Good luck.\"" }, { "docid": "466835", "title": "", "text": "\"This is several questions wrapped together: How can I diplomatically see the company's financial information? How strong a claim does a stockholder or warrantholder have to see the company's financials? What information do I need to know about the company financials before deciding to buy in? I'll start with the easier second question (which is quasi implicit). Stockholders typically have inspection rights. For example, Delaware General Corporate Law § 220 gives stockholders the right to inspect and copy company financial information, subject to certain restrictions. Check the laws and corporate code of your company's state of incorporation to find the specific inspection right. If it is an LLC or partnership, then the operating agreement usually controls and there may be no inspection rights. If you have no corporate stock, then of course you have no statutory inspection rights. My (admittedly incomplete) understanding is that warrantholders generally have no inspection rights unless somehow contracted for. So if you vest as a corporate stockholder, it'll be your right to see the financials—which may make even a small purchase valuable to you as a continuing employee with the right to see the financials. Until then, this is probably a courtesy and not their obligation. The first question is not easy to answer, except to say that it's variable and highly personal for small companies. Some people interpret it as prying or accusatory, the implication being that the founders are either hiding something or that you need to examine really closely the mouth of their beautiful gift horse. Other people may be much cooler about the question, understanding that small companies are risky and you're being methodical. And in some smaller companies, they may believe giving you the expenses could make office life awkward. If you approach it professionally, directly, and briefly (do not over-explain yourself) with the responsible accountant or HR person (if any), then I imagine it should not be a problem for them to give some information. Conversely, you may feel comfortable enough to review a high-level summary sheet with a founder, or to find some other way of tactfully reviewing the right information. In any case, I would keep the request vague, simple, and direct, and see what information they show you. If your request is too specific, then you risk pushing them to show information A, which they refuse to do, but a vague request would've prompted them to show you information B. A too-specific request might get you information X when a vague request could have garnered XYZ. Vague requests are also less aggressive and may raise fewer objections. The third question is difficult to say. My personal understanding is some perspective of how venture capitalists look at the investment opportunity (you didn't say how new this startup is or what series/stage they are on, so I'll try to stay vague). The actual financials are less relevant for startups than they are for other investments because the situation will definitely change. Most venture capital firms like to look at the burn rate or amount of cash spent, usually at a monthly rate. A high burn rate relative to infusions of cash suggests the company is growing rapidly but may have a risk of toppling (i.e. failing before exit). Burn rate can change drastically during the early life of the startup. Of course burn rate needs the context of revenues and reserves (and latest valuation is helpful as a benchmark, but you may be able to calculate that from the restricted share offer made to you). High burn rate might not be bad, if the company is booming along towards a successful exit. You might also want to look at some sort of business plan or info sheet, rather than financials alone. You want to gauge the size of the market (most startups like to claim 9- or 10-figure markets, so even a few percentage points of market share will hit revenue into the 8-figures). You'll also have to have a sense for the business plan and model and whether it's a good investment or a ridiculous rehash (\"\"it's Twitter for dogs meets Match.com for Russian Orthodox singles!\"\"). In other words, appraise it like an investor or VC and figure out whether it's a prospect for decent return. Typical things like competition, customer acquisition costs, manufacturing costs are relevant depending on the type of business activity. Of course, I wouldn't ignore psychology (note that economists and finance people don't generally condone the following sort of emotional thinking). If you don't invest in the company and it goes big, you'll kick yourself. If it goes really big, other people will either assume you are rich or feel sad for you if you say you didn't get rich. If you invest but lose money, it may not be so painful as not investing and losing out the opportunity. So if you consider the emotional aspect of personal finance, it may be wise to invest at least a little, and hedge against \"\"woulda-shoulda\"\" syndrome. That's more like emotional advice than hard-nosed financial advice. So much of the answer really depends on your particular circumstances. Obviously you have other considerations like whether you can afford the investment, which will be on you to decide. And of course, the § 83(b) election is almost always recommended in these situations (which seems to be what you are saying) to convert ordinary income into capital gain. You may also need cash to pay any up-front taxes on the § 83(b) equity, depending on your circumstances.\"" }, { "docid": "366830", "title": "", "text": "First, you should probably have a proper consultation with a licensed tax adviser (EA/CPA licensed in your State). In fact you should have had it before you started, but that ship has sailed. You're talking about start-up expenses. You can generally deduct up to $5000 in the year your business starts, and the expenses in excess will be amortized over 180 months (15 years). This is per the IRC Sec. 195. The amortization starts when your business is active (i.e.: you can buy the property, but not actually open the restaurant - you cannot start the depreciation). I have a couple questions about accounting - should all the money I spent be a part of capital spending? Or is it just a part of it? If it qualifies as start-up/organizational expenses - it should be capitalized. If it is spent on capital assets - then it should also be capitalized, but for different reasons and differently. For example, costs of filing paperwork for permits is a start-up expense. Buying a commercial oven is a capital asset purchase which should be depreciated separately, as buying the tables and silverware. If it is a salary expense to your employees - then it is a current expense and shouldn't be capitalized. Our company is LLC if this matters. It matters to how it affects your personal tax return." }, { "docid": "272425", "title": "", "text": "I'm assuming you're in the United States for this. I highly recommend getting a CPA to help you navigate the tax implications. Likely, you'll pay taxes as a sole proprietor, on top of any other income you made. Hopefully you kept good records because you'll be essentially paying for the profits, but you'll need to show the revenue and expenditures that you had. If you have any capital expenditures you may be able ton amortize them. But again, definitely hire a professional to help you, it will be well worth the cost." }, { "docid": "134047", "title": "", "text": "\"First of all congrats... very nice work indeed.. Secondly, i do not offer this as legal advise.. lol.. anyhow.. you need to make sure to hang on to as much as possible, being a single earner, our Uncle (Sam) is going to want what's due... That being said, you should probably look into investments, for starters, purchase a primary residence or start a business, or purchase a primary residence and use that as a business residence (both).. what you basically want are write-offs.. you need to bring your \"\"taxable\"\" income as low as possible so you pay minimal taxes.. in your case, you're in danger of paying a hefty sum in taxes... i'm sure you can shield yourself with various business expenses (a car, workplace, computers, etc.. ) that you could benefit from, both professionally and individually.. and then seriously bro... making 250k leads me to believe you've got at least more than half a brain, and that you're using more than half of that.. so dude.. get an accountant... and one you can trust.. ask your parents, colleagues, people you've worked with in the past.. etc.. there are professionals who are equally as talented in helping you keep your money as you are in making it.. -OR- you could get married, make sure your wife stays at home and start popping out kids asap... those keep my taxable (and excess) income pretty low.. LOL!!! I'm going to add to this... as a contractor, i've generally put any \"\"estimated\"\" taxes into some kind of interest accruing account so i can at least make a little money before i have to give it away.. in your case, i'd say put away at least 2/3's into some kind of interest earning account.. start by talking to your personal banker wherever your money is.. you'll be surprised at how nice they treat you... you ARE going to have to pay taxes.. so until you do, try to make a little money while it sits.. again, nice problem to have!\"" }, { "docid": "268314", "title": "", "text": "Should I go see a CPA? Not unless you are filing paperwork for a corporation. A CPA (Certified Public Accountant) is a certification required to file certain paperwork for a corporation. In any other situation, you don't need a CPA and can just use a regular accountant. You could conceivably go to a tax accountant, but unless you are doing something complicated (like your own business) or are rich enough that everything is complicated, you should not need to do so." }, { "docid": "546277", "title": "", "text": "Note: This is not professional tax advice. If you think you need professional tax advice, find a licensed professional in your local area. What are the expected earnings/year? US$100? US$1,000? US$100,000? I would say if this is for US$1,000 or less that registering an EIN, and consulting a CPA to file a Partnership Tax return is not going to be a profitable exercise.... all the earnings, perhaps more, will go to paying someone to do (or help do) the tax filings. The simplest taxes are for a business that you completely own. Corporations and Partnerships involve additional forms and get more and more and complex, and even more so when it involves foreign participation. Partnerships are often not formal partnerships but can be more easily thought of as independent businesses that each participants owns, that are simply doing some business with each other. Schedule C is the IRS form you fill out for any businesses that you own. On schedule C you would list the income from advertising. Also on schedule C there is a place for all of the business expenses, such as ads that you buy, a server that you rent, supplies, employees, and independent contractors. Amounts paid to an independent contractor certainly need not be based on hours, but could be a fixed fee, or based on profit earned. Finally, if you pay anyone in the USA over a certain amount, you have to tell the IRS about that with a Form 1099 at the beginning of the next year, so they can fill out their taxes. BUT.... according to an article in International Tax Blog you might not have to file Form 1099 with the IRS for foreign contractors if they are not US persons (not a US citizen or a resident visa holder)." }, { "docid": "150277", "title": "", "text": "I actually help companies start up for a living. Here are some big parts you should do. 1 - Post on craigslist for work. Seems pointless but it helps a ton. Youll get potential new clients and it will help. Do one ad every day under something specific. One day maybe dishwashers, next garbage disposal, next drain clogs, next water leaks. You get the point. This will help reach people after a specific thing. Also it will help get your name out. 2 - Post on your local news areas. For example your local papers website will have a section to add your business. Also do a search for local forums around your area and post there. 3 - Create a website. If you are short on cash get a site from a good name provider. Dont use go daddy as they are an evil company ha. Find one local if you can and support your local economy. It might be a few dollars more but it helps everyone out and tell them how you are a new company. They might have friends and family members that can spread word of mouth. Also ask them if they know of any local hosting providers. For your website id say hire someone. It should be under 1500 for everything if its done well. If you are short on cash get wordpress and get a good blog style you like and go from there. 4- Update your blog once a week to start. This will help google see it as a site thats worth something and move you up. After 6 months you can post daily, but dont wait 5 months then post. Oddly enough google will punish you at times for this. Makes no sense but thats how the beast can work. Your posts can be a new weekly deal. Showing a new job you did. Or maybe tricks that people can do themselves. While it seems that would be counter productive to business. When someone sees you as not trying to just sell something, they trust you more. 5 - Submit your site to the major search engines (google it). 6 - Post your company on local business pages. yelp, google, and others you have. Lots of people use this. Also after every job ask them to post a review on yelp and those other sites with a positive review. That might be the biggest helping factor. 7 - If you are in an older town just get a basic add in the yellow pages. Its not hard and very helpful. 8 - Go to your local fair events and do free contests. Like a free hours worth of drainage services. This can help you get a good rep from customers. As your company is going to live and die by word of mouth. Your skills are not going to cost him much of anything except time and it will in the long run give a great rep. 9 - You can try mail flyers which at times can have some success but that depends on if you have an older clientele or not in your area. Same goes for getting in the yellow pages. I personally am against it as most of the time these companies are scams trying to make an extra buck on you. 10 - Call local organizations that might need you. Boy scouts, girl scouts, ymca, and other programs. See if you can place a set of business cards at the counter at these places. This should help. This also goes for local business. Auto shops and other small business tend to help each other when it comes to things like this. Anyways i typed way too much, but there is a great way to help." }, { "docid": "527489", "title": "", "text": "\"I agree with Joe Taxpayer that a lot of details are missing to really evaluate it as an investment... for context, I own a few investment properties including a 'small' 10+ unit apartment complex. My answer might be more than you really want/need, (it kind of turned into Real Estate Investing 101), but to be fair you're really asking 3 different questions here: your headline asks \"\"how effective are Condo/Hotel developments as investments?\"\" An answer to that is... sometimes, very. These are a way for you-the investor-to get higher rents per sq. ft. as an owner, and for the hotel to limit its risks and access additional development funding. By your description, it sounds like this particular company is taking a substantial cut of rents. I don't know this property segment specifically, but I can give you my insight for longer-term apartment rentals... the numbers are the same at heart. The other two questions you're implying are \"\"How effective is THIS condo/hotel development?\"\" and \"\"Should you buy into it?\"\" If you have the funds and the financial wherewithal to honestly consider this, then I am sure that you don't need your hand held for the investment pros/cons warnings of the last question. But let me give you some of my insight as far as the way to evaluate an investment property, and a few other questions you might ask yourself before you make the decision to buy or perhaps to invest somewhere else. The finance side of real estate can be simple, or complicated. It sounds like you have a good start evaluating it, but here's what I would do: Start with figuring out how much revenue you will actually 'see': Gross Potential Income: 365 days x Average Rent for the Room = GPI (minus) Vacancy... you'll have to figure this out... you'll actually do the math as (Vacancy Rate %) x GPI (equals) Effective Potential Income = EPI Then find out how much you will actually pocket at the end of the day as operating income: Take EPI (minus) Operating expenses ... Utilities ... Maintenace ... HOA ... Marketing if you do this yourself (minus) Management Expenses ... 40% of EPI ... any other 'fees' they may charge if you manage it yourself. ... Extra tax help? (minus) Debt Service ... Mortgage payment ... include Insurances (property, PMI, etc) == Net Operating Income (NOI) Now NOI (minus) Taxes == Net Income Net Income (add back) Depreciation (add back) sometimes Mortgage Interest == After-tax Cash Flows There are two \"\"quickie\"\" numbers real estate investors can spout off. One is the NOI, the other is the Cap Rate. In order to answer \"\"How effective is THIS development?\"\" you'll have to run the numbers yourself and decide. The NOI will be based on any assumptions you choose to make for vacancy rates, actual revenue from hotel room bookings, etc. But it will show you how much you should bring in before taxes each year. If you divide the NOI by the asking price of your unit (and then multiply by 100), you'll get the \"\"Cap Rate\"\". This is a rough estimate of the rate of return you can expect for your unit... if you buy in. If you come back and say \"\"well I found out it has a XX% cap rate\"\", we won't really be qualified to help you out. Well established mega investment properties (think shopping centers, office buildings, etc.) can be as low as 3-5 cap rates, and as high as 10-12. The more risky the property, the higher your return should be. But if it's something you like, and the chance to make a 6% return feels right, then that's your choice. Or if you have something like a 15% cap rate... that's not necessarily outstanding given the level of risk (uncertain vacancies) involved in a hotel. Some other questions you should ask yourself include: How much competition is there in the area for short-term lodging? This could drive vacancies up or down... and rents up or down as well How 'liquid' will the property (room) be as an asset? If you can just break even on operating expense, then it might still make sense as an investment if you think that it might appreciate in value AND you would be able to sell the unit to someone else. How much experience does this property management company have... (a) in general, (b) running hotels, and (c) running these kinds of condo-hotel combination projects? I would be especially interested in what exactly you're getting in return for paying them 40% of every booking. Seasonality? This will play into Joe Taxpayer's question about Vacancy Rates. Your profile says you're from TX... which hints that you probably aren't looking at a condo on ski slopes or anything, but if you're looking at something that's a spring break-esque destination, then you might still have a great run of high o during March/April/May/June, but be nearly empty during October/November/December. I hope that helps. There is plenty of room to make a more \"\"exact\"\" model of what your cash flows might look like, but that will be based on assumptions and research you're probably not making at this time.\"" }, { "docid": "510257", "title": "", "text": "That's a simple overhead calculation. For secretary how much time is this person going to potentially save verses how much time I spend on those tasks. If secretary pay rate is near, equal, or less than what I spend in my own hourly rate it makes sense to hire. If it is not, do not hire, you don't want to loose money on overhead or have people sitting around doing nothing. Brand Manager is more complicated because it involves speculation and projection. I would want some kind of trial solution before a more permanent solution was decided on. For example, if brand manager is renewing my brand image what do I anticipate that new image will bring in additional revenue, or alternatively, what new markets will my product now be able to tap into that it was not able to tap into before. Then I would do the simple sales calculation of how much revenue would I need to expect to cover the cost of the overhead and project to justify viability. Then simply ask the question of if it is reasonable to expect those kinds of returns from this person or project. In business there is risk. There's really two ways to look at risk, big risk = big reward and screw the consequences if we fail, or make sure that risk is diminished as much as possible before making a decision. I would say most start-ups begin with big risk = big reward and then evolve into diminishing risk as much as possible. Both have many good and many bad examples. Most involve businesses dead before they figure out how to diminish risk, or in extreme examples wall street people diminishing risk by cheating the system, but we aren't discussing ethics." }, { "docid": "591344", "title": "", "text": "Yeah true that. Counseling people to avoid the negatives has been more beneficial in my life than great recommendations. Even one mistake and you're up shit's creek. And I will say I have the knowledge to help people to avoid mistakes, but sometimes it devolves into mud slinging (unfortunately). If this wasn't a new account then it might give you an indication of how I've done this in the past. Most of the time it takes too much explaining to get people up to speed though. A word to the wise: I'd recommend being open to switching industries. Everyone in finance is pretty toxic and all ended up there because of money. End up chasing the CFA (cancer distilled into three exams), grad school, nonsense corporate jobs, or the dream in high finance/small shops where the founders don't think they need another smart hard-working person. Even if if it's obvious they do. I remember reaching out and counseling a firm on selling a position that I felt was really stupid. It was not at all in line with their investing objectives and also was one I would never touch. The guy actually agreed with me, didn't hire me (I was after a job), didn't sell the position, and lost them approx. $12 million within 12 months with my math on their 13-F's. I only reach out to firms I respect, which works out to about 1 firm per 100k people in population from what I've seen (in a city like Pittsburgh this was only 4 shops). That means there are maybe 200 people in the US who would make a hiring decision on me for what I like to do. But I've stopped playing that game. I now run a healthcare business I started. It was hard as hell to open but I now run circles around people because nobody actually is in the business of the industry. The doctors, nurses, etc. are all extremely bright - just not in my area. Makes for a much more fun workday." }, { "docid": "105444", "title": "", "text": "Not sure how Technology Mgmt differs from IS but I would limit your options to be Finance, Accounting, TM/IS. Technology is only going up and people are always going to have problems with it so no problems. Every larger company has an IT department that handles issues from looking for new technology or an IT Service Desk where you answer calls from someone having an issue with their computer. From what I hear from colleagues is experience is huge here. From an IT perspective I think this major would have the highest probability of landing a job. Accounting and Finance is different. If you go down one of those paths, to be the most successful you'll have to take supplement courses to get either a CPA or CFA. Also working in the big accounting firms from what I've seen is super stressful based on when their clients close their books each quarter but is very rewarding. To move up in Accounting you'd want to get the CPA. If you don't have it, you'll plateau at some point and won't get any higher without it really. I chose finance, but did not want to be a financial advisor. I did not like the idea of retaining clients by refers or cold calling. Essentially if you remember the scene on Wolf of Wall Street where Leo gets the little job and makes a huge sale off a cold call, that's what it is like when you first start out. You are pressured to sell insurance and stocks to your friends and family in hope that they refer you to their friends and family...it works for some people and it doesn't for others. Down this path you'd also possibly take the CFA tests and for sure series 6, 66, 7. Currently I'm not doing anything finance related but it is a great background for your personal finances and what not. I would say you want to choose soon though so you can work on getting internships. Internships are huge as it will be a professional reference and if you do well in the position that company could hire you on once you graduate. Hope this helped. TLDR: Get an internship and experience the job." }, { "docid": "69560", "title": "", "text": "\"Square use SSN to verify identity, and they only ask for the last 4 digits for that purpose. If she entered the full SSN - then she entered it into the tax id field, which was a wrong thing to do. It is also worth mentioning that since you mentioned a \"\"business partner\"\" that \"\"should have taken care of taxes\"\" that you should have a tax adviser whose job would be to take care of taxes and ensure that your interests are well-represented. I would suggest not to try interacting with the IRS on your own. Hire a tax adviser (EA/CPA licensed in your State) to do that. That tax adviser will be able to fix the problem (there are different ways of doing it, depending on the circumstances) and also verify that the business taxes were properly taken care of. When dealing with business partners - assume that what they've \"\"supposedly\"\" did was not done, until you see it with your own eyes. Saying that \"\"Supposedly, her business partner took care of all tax issues\"\" means, in this case, that you've been caught with unreported income that you tried to conceal. It is your (your sister's...) responsibility to prove otherwise. It is a very weak defense when the IRS comes knocking on the door for their money.\"" }, { "docid": "141511", "title": "", "text": "Largely it comes down to the complexity of your return (likely relatively simple if it's your first time filing) and your comfort level with using software. More complex returns would include filing business claims, handling stocks and investments, special return forms, etc. One benefit to most of the software options out there such as TurboTax, HR Block, and Tax Slayer, are that they are free to use and you only pay when you're ready to file. You could give them a shot to see how easy/difficult they are and if you feel overwhelmed, then contact a CPA (whose time won't be free). Also remember that those HR Block seasonal places that open up are not CPA's, but are temps hired and trained to use the software that you would find online. You didn't indicate they were an option, but I like to point that out to those who might not know otherwise. My opinion would be to use one of the online options because of cost and their ease of use. They also allow you to take your time and save your progress, so you can start using it and go ask questions/do research on your own time." }, { "docid": "152044", "title": "", "text": "\"You are looking to be made whole, so the requests need to be reasonable. You need to be clear that you want: You aren't going to 'punish' the dry cleaner or anything else. You don't want coupons or free service for future work, you want your pants or cash. If you send a letter, send it certified with a return receipt. You want to be able to show a judge you made efforts outside of the court that you attempted to reconcile the issue. Sending it certified is also a good way to indicate to the dry cleaner that you aren't going to just go away. Be clear, firm and very polite. You cannot blame or criticize the cleaner, simply state \"\"On YY/YY/YYYY date I didn't get my pants back; I want my pants or I want money by XX/XX/XXXX date.\"\" If you want to picket, contact local law enforcement and find out the rules before picketing. You can probably picket from a sidewalk, but that doesn't mean the dry cleaner won't approach you and get in your personal space. If you hand out flyers, stick strictly to provable facts lest you be sued for defamation. It is smarter to hand out a fact sheet or speak from a rehearsed script so that you don't say something that would be actionable. Make sure you pick the busiest day of the week for a dry cleaner. (Weekends?) I don't think this is criminal, but you can sue. Like others said, if you have the cleaning ticket (and the ticket doesn't absolve the dry cleaner of responsibility) you will probably get a judgement. Be careful what you ask for, make sure you cover all of your costs (the pants, filing fees, time off of work, and collection efforts.) Itemize all your requested costs and make sure they are reasonable. You only want to be made whole, and that only means $160 or pants (plus fees) Just because you won in small claims doesn't mean you can collect easily. Figure in your cost for collecting when you sue. You might have to hire somebody to collect on your judgement. If you hire somebody they will want a cut, so you might want to figure that out for your small claims. I am guessing this is a local business, so it should be pretty easy to collect. (Unless they go out of business, in which case you will get nothing.)\"" }, { "docid": "266229", "title": "", "text": "\"The HMRC has a dedicated self-help/learning site that is helpful here: It's important to tell HMRC that you are self-employed as soon as possible. If you don't, you may have to pay a penalty. You don't want to pay more to HMRC than you have to as it is a waste of your money. Your business has started when you start to advertise or you have a customer to buy your goods or services. It is at this point that your business is 'trading'. You cannot register before you start trading. For example, if you advertise your business in the local newspaper on 15 January but do not get your first customer until 29 March; in this case, you have been trading since 15 January. You must tell HMRC within six months of the end of the tax year in which you start self-employment. You must therefore register by 5 October. But it's best to register well before this so that you do not forget to do so. The HMRC also has a YouTube channel with help videos, and \"\"Am I Trading or Not?\"\" might be of particular interest to you. Most of the registration is based around the concept of starting to work with the intent to make a profit. By the letter of law and regulations, you should register within six months of the end of the tax year you started to avoid any potential penalty. However note that the situation is different based upon your intent. If you begin making/putting up videos online as a hobby with the hope that you can make something to help you defray the basic costs involved, and the total amount you make is relatively small (say, less than 500 pounds), you will not be classified as \"\"trading\"\" and likely have no need to register with HMRC. As soon as you begin to get in regular payments, maybe a single payment of a significant size, or multiple payments for a similar service/item, you are vastly more likely to need to register. From my reading you would likely be safe to begin putting up videos without registration, but if you begin spending a large portion of your time over an extended period (multiple months) and/or begin getting payments of any notable size then you should likely register with the appropriate services (HMRC, etc). As is the case in both the USA and UK, simple registration is pretty cheap and the costs of little/no income are usually pretty minor. Also note that the HMRC trading and self-employment regulations are unusual compared to many US laws/institutions, in that you are explicitly permitted to begin doing something and only register later. So if you start doing videos for an entire tax year + 5 months and make nothing significant, you'd seemingly be fine to never register at all.\"" } ]

[ { "docid": "494625", "title": "", "text": "Certainly sounds worthwhile to get a CPA to help you with setting up the books properly and learning to maintain them, even if you do it yourself thereafter. What's your own time worth?" } ]

[ { "docid": "115055", "title": "", "text": "Years ago I hired someone part time (not virtual however) to help me with all sorts of things. Yes it helps free up some time. However particularly with finances, it does take a leap of faith. If you have high value accounts that this person will be dealing with you can always get them bonded. Getting an individual with a clean credit history and no criminal background bonded usually costs < $600 a year (depending on $ risk exposure). I would start out small with tasks that do not directly put that person in control of your money. In my case I didn't have an official business, I worked a normal 9-5 job, but I owned several rental units, and an interest in a bar. My assistant also had a normal 9-5 job and worked 5-10 hours a week for me on various things. Small stuff at first like managing my calendar, reminding me when bills were due, shipping packages, even calling to set up a hair cut. At some point she moved to contacting tenants, meeting with contractors, showing apartments, etc... I paid her a fixed about each week plus expenses. I would pay her extra if I needed her more (say showing an apartment on a Saturday, or meeting a plumber). She would handled all sorts of stuff for me, and I gave her the flexibility when needed to fit things in with her schedule. After about a month I did get her a credit card for expenses. Obviously a virtual assistant would not be able to do some of these things but I think you get the point. Eventually when the trust had been built up I put her on most of my accounts and gave her some fiduciary responsibilities as well. I'm not sure that this level of trust would be possible to get to with a virtual assistant. However, with a virtual assistant you might be able to avoid one really big danger of hiring an assistant.... You see, several years later when I sold off my apartment buildings I no longer needed an assistant, so I married her. Now one good thing about that is I don't have to pay her now. ;)" }, { "docid": "568629", "title": "", "text": "Wow! First, congratulations! You are both making great money. You should be able to reach your goals. Are we on the right track ? Are we doing any mistakes which we could have avoided ? Please advice if there is something that we should focus more into ! I would prioritize as follows: Get on the same page. My first red flag is that you are listing your assets separately. You and your wife own property together and are raising your daughter together. The first thing is to both be on the same page with your combined income and assets. This is critical. Set specific goals for the future. Dreaming and big-picture life planning will be the foundation for building a detailed plan for reaching your goals. You will see more progress with more sacrifice. If you both are not equally excited about the goals, you will not both be equally willing to sacrifice lifestyle now. You have the income now to be able to set yourselves up to do whatever you want in 10 years, if you can agree on what you want. Hire a financial planner you trust. Interview people, ask someone who is where you want to be in 10 years. You need someone with experience that can guide you through these questions and understands how to manage your income stream. Start saving for retirement in tax-advantaged accounts. This should be as much as 10%-15% of your income combined, so $30k-$45k per year. You need to start diversifying your investments. Real estate is great, but I would never recommend it as this large a percentage of net worth. Start saving for your child's education. Hard to say what you need here, since I don't know your goals. A financial planner should assist you with this. Get rid of your debt. Out of your $2.1M of rental real estate and land, you have $1.4M of debt. It will be difficult to start a business with that much additional debt. It will also put stress on your retirement that you don't need. You are taking on lots of risk here. I would sell all but maybe one of the properties and let it cash flow. This will free up cash to start investing for retirement or future business too. Buy more rental in the future with cash only. You have plenty of income to do it this way, and you will be setting yourself up for a great future. At this point you can continue to pile funds into any/all your investments, with the goal of using the funds to start a business or to live on. If all your investments are tied up in real estate, you wont have anything to draw on if needed for a business opportunity. You need to weigh this out in your goal and planning. What should we do to prepare for a comfortable retirement and safety You cannot plan for or see all scenarios. However, good planning will give you more options and more choices. Investing driven by fear will set you up for failure. Spend less than you make. Be patient. Be generous. Cheers!" }, { "docid": "393104", "title": "", "text": "\"If you were the friend of my daughter or some other \"\"trusted\"\" relationship, I would tell you to head on over to Bogleheads.org, follow their advice and do research there. I would advise you to aim for about a 60/40 allocation. They would advise you to make a very simple, do it yourself portfolio that could last a lifetime. No need for financial planners or other vultures. The other side of this curtailing your spending. Although the amount seems like a bunch, you probably need to keep your spending under 41K per year out of this money. If you have additional income such as from a job or social security payments then that could be on top of the 41k and never forget taxes. To help manage that, you may want to consult a CPA, but only for tax advice, not investment advice. Certainly you should make the credit card debt disappear. You may want to reevaluate your current location if the costs are too high compared to your income. Good luck to you and sorry about the wreck.\"" }, { "docid": "141511", "title": "", "text": "Largely it comes down to the complexity of your return (likely relatively simple if it's your first time filing) and your comfort level with using software. More complex returns would include filing business claims, handling stocks and investments, special return forms, etc. One benefit to most of the software options out there such as TurboTax, HR Block, and Tax Slayer, are that they are free to use and you only pay when you're ready to file. You could give them a shot to see how easy/difficult they are and if you feel overwhelmed, then contact a CPA (whose time won't be free). Also remember that those HR Block seasonal places that open up are not CPA's, but are temps hired and trained to use the software that you would find online. You didn't indicate they were an option, but I like to point that out to those who might not know otherwise. My opinion would be to use one of the online options because of cost and their ease of use. They also allow you to take your time and save your progress, so you can start using it and go ask questions/do research on your own time." }, { "docid": "320579", "title": "", "text": "\"I think you may have a significant misunderstanding here. You have been renting your property out for two years, now. There is no special \"\"roommate\"\" clause in the tax code; roommates are renters, and the rent they pay is rental income. (If they were roommates in a property you both rented from a third party, that would be different.) See publication 527, chapter 4 for more details on the subject (search on \"\"Renting Part of Property\"\"). You should be: You may also consider \"\"Not renting for profit\"\" section, which may be closer to what you're actually thinking - of changing from \"\"Renting not for profit\"\" to \"\"Renting for profit\"\". Not rented for profit means you can report on your 1040 as opposed to filing Schedule E, but it does mean you have to actually not make a profit (and remember, some of the money that goes to paying the mortgage is not deductible on this side of things since it's your property and you'll get that money back, presumably, when you sell it). If that is what you're asking about, it sounds like it's just a matter of money. Are you going to start making money? Or, are you going to start making enough significant upgrades/etc. to justify the tax deduction? You should consider the actual, specific numbers carefully, probably with the help of a CPA who is familiar with this sort of situation, and then make the decision that gives you the best outcome (keeping in mind that there may be long-term impacts of switching from not-for-profit to for-profit rental treatment).\"" }, { "docid": "268314", "title": "", "text": "Should I go see a CPA? Not unless you are filing paperwork for a corporation. A CPA (Certified Public Accountant) is a certification required to file certain paperwork for a corporation. In any other situation, you don't need a CPA and can just use a regular accountant. You could conceivably go to a tax accountant, but unless you are doing something complicated (like your own business) or are rich enough that everything is complicated, you should not need to do so." }, { "docid": "266229", "title": "", "text": "\"The HMRC has a dedicated self-help/learning site that is helpful here: It's important to tell HMRC that you are self-employed as soon as possible. If you don't, you may have to pay a penalty. You don't want to pay more to HMRC than you have to as it is a waste of your money. Your business has started when you start to advertise or you have a customer to buy your goods or services. It is at this point that your business is 'trading'. You cannot register before you start trading. For example, if you advertise your business in the local newspaper on 15 January but do not get your first customer until 29 March; in this case, you have been trading since 15 January. You must tell HMRC within six months of the end of the tax year in which you start self-employment. You must therefore register by 5 October. But it's best to register well before this so that you do not forget to do so. The HMRC also has a YouTube channel with help videos, and \"\"Am I Trading or Not?\"\" might be of particular interest to you. Most of the registration is based around the concept of starting to work with the intent to make a profit. By the letter of law and regulations, you should register within six months of the end of the tax year you started to avoid any potential penalty. However note that the situation is different based upon your intent. If you begin making/putting up videos online as a hobby with the hope that you can make something to help you defray the basic costs involved, and the total amount you make is relatively small (say, less than 500 pounds), you will not be classified as \"\"trading\"\" and likely have no need to register with HMRC. As soon as you begin to get in regular payments, maybe a single payment of a significant size, or multiple payments for a similar service/item, you are vastly more likely to need to register. From my reading you would likely be safe to begin putting up videos without registration, but if you begin spending a large portion of your time over an extended period (multiple months) and/or begin getting payments of any notable size then you should likely register with the appropriate services (HMRC, etc). As is the case in both the USA and UK, simple registration is pretty cheap and the costs of little/no income are usually pretty minor. Also note that the HMRC trading and self-employment regulations are unusual compared to many US laws/institutions, in that you are explicitly permitted to begin doing something and only register later. So if you start doing videos for an entire tax year + 5 months and make nothing significant, you'd seemingly be fine to never register at all.\"" }, { "docid": "505134", "title": "", "text": "\"I am perfectly qualified to not use an accountant. I am a business professor, and my work crosses over into accounting quite a bit. I would certainly find a CPA that is reputable and hire them for advice before starting. I know a physicist who didn't do that and found they ended up with $78,000 in fines. There are a number of specific things an accountant might provide that Quickbooks will not. First and foremost, they are an outsider's set of eyes. If they are good, they will find a polite way to say \"\"you want to do what?!?!?!\"\" If they are good, they won't fall out of their chair, their jaw won't drop to the floor, and they won't giggle until they get home. A good accountant has seen around a hundred successful and unsuccessful businesses. They have seen everything you may have thought of. Intelligence is learning from your own mistakes, wisdom is learning from the mistakes of others. Accountants are the repositories of wisdom. An accountant can point out weaknesses in your plan and help you shore it up. They can provide information about the local market that you may not be aware of. They can assist you with understanding the long run consequences of the legal form that you choose. They can assist you in understanding the trade-offs of different funding models. They can also do tasks that you are not talented at and which will take a lot of time if you do it, and little time if they do it. There is a reason that accountants are required to have 160 semester hours to sit for the CPA. They also have to have a few thousand field hours before they can sit for it as well. There is one thing you may want to keep in mind though. An accountant will often do what you ask them to do, so think about what you want before you visit the accountant. Also, remember to ask the question \"\"is there a question I should have asked but didn't?\"\"\"" }, { "docid": "527489", "title": "", "text": "\"I agree with Joe Taxpayer that a lot of details are missing to really evaluate it as an investment... for context, I own a few investment properties including a 'small' 10+ unit apartment complex. My answer might be more than you really want/need, (it kind of turned into Real Estate Investing 101), but to be fair you're really asking 3 different questions here: your headline asks \"\"how effective are Condo/Hotel developments as investments?\"\" An answer to that is... sometimes, very. These are a way for you-the investor-to get higher rents per sq. ft. as an owner, and for the hotel to limit its risks and access additional development funding. By your description, it sounds like this particular company is taking a substantial cut of rents. I don't know this property segment specifically, but I can give you my insight for longer-term apartment rentals... the numbers are the same at heart. The other two questions you're implying are \"\"How effective is THIS condo/hotel development?\"\" and \"\"Should you buy into it?\"\" If you have the funds and the financial wherewithal to honestly consider this, then I am sure that you don't need your hand held for the investment pros/cons warnings of the last question. But let me give you some of my insight as far as the way to evaluate an investment property, and a few other questions you might ask yourself before you make the decision to buy or perhaps to invest somewhere else. The finance side of real estate can be simple, or complicated. It sounds like you have a good start evaluating it, but here's what I would do: Start with figuring out how much revenue you will actually 'see': Gross Potential Income: 365 days x Average Rent for the Room = GPI (minus) Vacancy... you'll have to figure this out... you'll actually do the math as (Vacancy Rate %) x GPI (equals) Effective Potential Income = EPI Then find out how much you will actually pocket at the end of the day as operating income: Take EPI (minus) Operating expenses ... Utilities ... Maintenace ... HOA ... Marketing if you do this yourself (minus) Management Expenses ... 40% of EPI ... any other 'fees' they may charge if you manage it yourself. ... Extra tax help? (minus) Debt Service ... Mortgage payment ... include Insurances (property, PMI, etc) == Net Operating Income (NOI) Now NOI (minus) Taxes == Net Income Net Income (add back) Depreciation (add back) sometimes Mortgage Interest == After-tax Cash Flows There are two \"\"quickie\"\" numbers real estate investors can spout off. One is the NOI, the other is the Cap Rate. In order to answer \"\"How effective is THIS development?\"\" you'll have to run the numbers yourself and decide. The NOI will be based on any assumptions you choose to make for vacancy rates, actual revenue from hotel room bookings, etc. But it will show you how much you should bring in before taxes each year. If you divide the NOI by the asking price of your unit (and then multiply by 100), you'll get the \"\"Cap Rate\"\". This is a rough estimate of the rate of return you can expect for your unit... if you buy in. If you come back and say \"\"well I found out it has a XX% cap rate\"\", we won't really be qualified to help you out. Well established mega investment properties (think shopping centers, office buildings, etc.) can be as low as 3-5 cap rates, and as high as 10-12. The more risky the property, the higher your return should be. But if it's something you like, and the chance to make a 6% return feels right, then that's your choice. Or if you have something like a 15% cap rate... that's not necessarily outstanding given the level of risk (uncertain vacancies) involved in a hotel. Some other questions you should ask yourself include: How much competition is there in the area for short-term lodging? This could drive vacancies up or down... and rents up or down as well How 'liquid' will the property (room) be as an asset? If you can just break even on operating expense, then it might still make sense as an investment if you think that it might appreciate in value AND you would be able to sell the unit to someone else. How much experience does this property management company have... (a) in general, (b) running hotels, and (c) running these kinds of condo-hotel combination projects? I would be especially interested in what exactly you're getting in return for paying them 40% of every booking. Seasonality? This will play into Joe Taxpayer's question about Vacancy Rates. Your profile says you're from TX... which hints that you probably aren't looking at a condo on ski slopes or anything, but if you're looking at something that's a spring break-esque destination, then you might still have a great run of high o during March/April/May/June, but be nearly empty during October/November/December. I hope that helps. There is plenty of room to make a more \"\"exact\"\" model of what your cash flows might look like, but that will be based on assumptions and research you're probably not making at this time.\"" }, { "docid": "164559", "title": "", "text": "You should invest in that with the best possible outcome. Right now that is in yourself. Your greatest wealth building tool, at this point, is your future income. As such anything you can do to increase your earnings potential. For some that might mean getting an engineering degree, for others it might mean starting a small business. For some it is both obtaining a college degree and learning about business. A secondary thing to learn about would be personal finance. I would hold off on stocks, at this time, until you get your first real job and you have an emergency fund in place. Penny stocks are worthless, forget about them. Bonds have their place, but not at this point in your life. Saving up for college and obtaining a quality education, debt free, should be your top priority. Saving up for emergencies is a secondary priority, but only after you have more than enough money to fund your college education. You can start thinking about retirement, but you need a career to help fund your savings plan. Put that off until you have such a career. Investing in stocks, at this juncture, is a bit foolish. Start a career first. Any job you take now should be seen as a step towards a larger goal and should not define who you are." }, { "docid": "374443", "title": "", "text": "Based on your question details, I doubt you'll like this answer...but first things first, you need to focus on rebuilding your credit and your savings. $1K isn't a huge loan amount, so I'm going to assume you've made some poor decisions in the past to get to this point. I'm a small business owner, and I make it a goal to have 3-6 months of expected expenses in an account, should my circumstances ever drastically change or something happen that would keep me from working. Without knowing your living situation and daily expenses, here's some general advice on building a small business without a loan: 1) Find steady, gainful employment anywhere you can. 2) Pay off outstanding debts and rebuild a savings account to rebuild your credit score. 3) If you need fast cash, sell some stuff you don't need (gaming systems, home electronics, etc.). Also, minimize your unnecessary expenses (dining out, etc.). 4) Once your debts are paid off, create a business startup savings plan (put away as much as you can afford every week, until you reach your goal. 5) Once your goal is reached, you can begin your flipping business. Open a bank account, and separate your profits into buckets for operations, self-pay, and taxes (if you declare this income, which I hope you do). For myself, I put away 35% for income taxes, which I do not touch until my taxes are paid. I put 40% away for daily operations -- this keeps my business running, allowing me to pay for the equipment I need, the products I deliver, and advertising to keep my business running. I pay myself 25%. This is a simple method, but it works well for me." }, { "docid": "146657", "title": "", "text": "Yes, you should be able to deduct at least some of these expenses. For expense incurred before you started the business: What Are Deductible Startup Costs? The IRS defines “startup costs” as deductible capital expenses that are used to pay for: 1) The cost of “investigating the creation or acquisition of an active trade or business.” This includes costs incurred for surveying markets, product analysis, labor supply, visiting potential business locations and similar expenditures. 2) The cost of getting a business ready to operate (before you open your doors or start generating income). These include employee training and wages, consultant fees, advertising, and travel costs associated with finding suppliers, distributors, and customers. These expenses can only be claimed if your research and preparation ends with the formation of a successful business. The IRS has more information on how to claim the expenses if you don’t go into business. https://www.sba.gov/blogs/startup-cost-tax-deductions-how-write-expense-starting-your-business Once your business is underway, you can deduct expenses, but the exact details depend on how you organized. If you're a sole proprietor for tax purposes, then you'll deduct them on Schedule C of your Form 1040 on your personal tax. If you are a partnership, C-Corp, or S-Corp, they will be accounted at the business level and either passed on to you on a Schedule K (partnership and S-Corp) or deducted directly by the company (C-Corp). In any case, you will need good records that justify your expenses as business related. It might be well worth at least an initial meeting with a CPA to make sure that you get started on the right foot." }, { "docid": "466835", "title": "", "text": "\"This is several questions wrapped together: How can I diplomatically see the company's financial information? How strong a claim does a stockholder or warrantholder have to see the company's financials? What information do I need to know about the company financials before deciding to buy in? I'll start with the easier second question (which is quasi implicit). Stockholders typically have inspection rights. For example, Delaware General Corporate Law § 220 gives stockholders the right to inspect and copy company financial information, subject to certain restrictions. Check the laws and corporate code of your company's state of incorporation to find the specific inspection right. If it is an LLC or partnership, then the operating agreement usually controls and there may be no inspection rights. If you have no corporate stock, then of course you have no statutory inspection rights. My (admittedly incomplete) understanding is that warrantholders generally have no inspection rights unless somehow contracted for. So if you vest as a corporate stockholder, it'll be your right to see the financials—which may make even a small purchase valuable to you as a continuing employee with the right to see the financials. Until then, this is probably a courtesy and not their obligation. The first question is not easy to answer, except to say that it's variable and highly personal for small companies. Some people interpret it as prying or accusatory, the implication being that the founders are either hiding something or that you need to examine really closely the mouth of their beautiful gift horse. Other people may be much cooler about the question, understanding that small companies are risky and you're being methodical. And in some smaller companies, they may believe giving you the expenses could make office life awkward. If you approach it professionally, directly, and briefly (do not over-explain yourself) with the responsible accountant or HR person (if any), then I imagine it should not be a problem for them to give some information. Conversely, you may feel comfortable enough to review a high-level summary sheet with a founder, or to find some other way of tactfully reviewing the right information. In any case, I would keep the request vague, simple, and direct, and see what information they show you. If your request is too specific, then you risk pushing them to show information A, which they refuse to do, but a vague request would've prompted them to show you information B. A too-specific request might get you information X when a vague request could have garnered XYZ. Vague requests are also less aggressive and may raise fewer objections. The third question is difficult to say. My personal understanding is some perspective of how venture capitalists look at the investment opportunity (you didn't say how new this startup is or what series/stage they are on, so I'll try to stay vague). The actual financials are less relevant for startups than they are for other investments because the situation will definitely change. Most venture capital firms like to look at the burn rate or amount of cash spent, usually at a monthly rate. A high burn rate relative to infusions of cash suggests the company is growing rapidly but may have a risk of toppling (i.e. failing before exit). Burn rate can change drastically during the early life of the startup. Of course burn rate needs the context of revenues and reserves (and latest valuation is helpful as a benchmark, but you may be able to calculate that from the restricted share offer made to you). High burn rate might not be bad, if the company is booming along towards a successful exit. You might also want to look at some sort of business plan or info sheet, rather than financials alone. You want to gauge the size of the market (most startups like to claim 9- or 10-figure markets, so even a few percentage points of market share will hit revenue into the 8-figures). You'll also have to have a sense for the business plan and model and whether it's a good investment or a ridiculous rehash (\"\"it's Twitter for dogs meets Match.com for Russian Orthodox singles!\"\"). In other words, appraise it like an investor or VC and figure out whether it's a prospect for decent return. Typical things like competition, customer acquisition costs, manufacturing costs are relevant depending on the type of business activity. Of course, I wouldn't ignore psychology (note that economists and finance people don't generally condone the following sort of emotional thinking). If you don't invest in the company and it goes big, you'll kick yourself. If it goes really big, other people will either assume you are rich or feel sad for you if you say you didn't get rich. If you invest but lose money, it may not be so painful as not investing and losing out the opportunity. So if you consider the emotional aspect of personal finance, it may be wise to invest at least a little, and hedge against \"\"woulda-shoulda\"\" syndrome. That's more like emotional advice than hard-nosed financial advice. So much of the answer really depends on your particular circumstances. Obviously you have other considerations like whether you can afford the investment, which will be on you to decide. And of course, the § 83(b) election is almost always recommended in these situations (which seems to be what you are saying) to convert ordinary income into capital gain. You may also need cash to pay any up-front taxes on the § 83(b) equity, depending on your circumstances.\"" }, { "docid": "448521", "title": "", "text": "If the country went to a sustainable minimum wage like 15 dollars an hour we would benefit more. Anyone who thinks the walmart strikes are stupid and they should be fired clearly doesnt understand how the economy should work. You can blame walmart for trying to make as much as possible and not caring about their workforce. Look at costco and how they start all employees off at 12 dollars an hour. The company does amazing still. Also there have been countless studies that show increasing minimum wage does not hurt local businesses but actually helps out the economy. Because those lower/middle class people have a higher purchasing power, do not need government assistance as much, and can work on starting other small businesses that help out. The big nay sayers believe that it will cripple local businesses or increase the price of goods. While goods will increase in price some it is never anywhere near the amount to correlate with the wage increase. Its sad as a country people believe slavery is fine. If you are pro for under 15 dollars an hour, you are pro slavery. Im on my phone so i cant pull up all the fun statistics, but feel free to do the searches yourself. Lots of stories on how it benefits an economy overall. The only people making these facts up are the ones who own the businesses because their wealth will go down and be spread among employees more." }, { "docid": "150219", "title": "", "text": "\"We will bill our clients periodically and will get paid monthly. Who are \"\"we\"\"? If you're not employed - you're not the one doing the work or billing the client. Would IRS care about this or this should be something written in the policy of our company. For example: \"\"Every two months profits get divided 50/50\"\" They won't. S-Corp is a pass-through entity. We plan to use Schedule K when filing taxes for 2015. I've never filled a schedule K before, will the profit distributions be reflected on this form? Yes, that is what it is for. We might need extra help in 2015, so we plan to hire an additional employee (who will not be a shareholder). Will our tax liability go down by doing this? Down in what sense? Payroll is deductible, if that's what you mean. Are there certain other things that should be kept in mind to reduce the tax liability? Yes. Getting a proper tax adviser (EA/CPA licensed in your State) to explain to you what S-Corp is, how it works, how payroll works, how owner-shareholder is taxed etc etc.\"" }, { "docid": "321619", "title": "", "text": "This is assuming that you are now making some amount X per month which is more than the income you used to have as a student. (Otherwise, the question seems rather moot.) All figures should be net amounts (after taxes). First, figure out what the difference in your cost of living is. That is, housing, electricity, utilities, the basics that you need to have to have a place in which to live. I'm not considering food costs here unless they were subsidized while you were studying. Basically, you want to figure out how much you now have to spend extra per month for basic sustenance. Then, figure out how much more you are now making, compared to when you were a student. Subtract the sustenance extra from this to get your net pay increase. After that is when it gets trickier. Basically, you want to set aside or invest as much of the pay increase as possible, but you probably have other expenses now that you didn't before and which you cannot really do that much about. This mights be particular types of clothes, commute fares (car keepup, gas, bus pass, ...), or something entirely different. Anyway, decide on a savings goal, as a percentage of your net pay increase compared to when you were a student. This might be 5%, 10% or (if you are really ambitious) 50% or more. Whichever number you pick, make sure it's reasonable giving your living expenses, and keep in mind that anything is better than nothing. Find a financial institution that offers a high-interest savings account, preferably one with free withdrawals, and sign up for one. Each and every time you get paid, figure out how much to save based on the percentage you determined (if your regular case is that you get the same payment each time, you can simply set up an automated bank transfer), put that in the savings account and, for the moment, forget about that money. Try your best to live only on the remainder, but if you realize that you set aside too much, don't be afraid to tap into the savings account. Adjust your future deposits accordingly and try to find a good balance. At the end of each month, deposit whatever remains in your regular account into your savings account, and if that is a sizable amount of money, consider raising your savings goal a little. The ultimate goal should be that you don't need to tap into your savings except for truly exceptional situations, but still keep enough money outside of the savings account to cater to some of your wants. Yes, bank interest rates these days are often pretty dismal, and you will probably be lucky to find a savings account that (especially after taxes) will even keep up with inflation. But to start with, what you should be focusing on is not to make money in terms of real value appreciation, but simply figuring out how much money you really need to sustain a working life for yourself and then walking that walk. Eventually (this may take anywhere from a couple of months to a year or more), you should have settled pretty well on an amount that you feel comfortable with setting aside each month and just letting be. By that time, you should have a decently sized nest egg already, which will help you get over rough spots, and can start thinking about other forms of investing some of what you are setting aside. Whenever you get a net pay raise of any kind (gross pay raise, lower taxes, bonus, whichever), increase your savings goal by a portion of that raise. Maybe give yourself 60% of the raise and bank the remaining 40%. That way, you are (hopefully!) always increasing the amount of money that you are setting aside, while also reaping some benefits right away. One major upside of this approach is that, if you lose your job, not only will you have that nest egg, you will also be used to living on less. So you will have more money in the bank and less monthly expenses, which puts you in a significantly better position than if you had only one of those, let alone neither." }, { "docid": "384541", "title": "", "text": "\"An employee costs the company in four ways: Salary, taxes, benefits, and capital. Salary: The obvious one, what they pay you. Taxes: There are several taxes that an employer has to pay for the privilege of hiring someone, including social security taxes (which goes to your retirement), unemployment insurance tax (your unemployment benefits if they lay you off), and workers compensation tax (pays if you are injured on the job). (There may be other taxes that I'm not thinking of, but in any case those are the main ones.) Benefits: In the U.S. employers often pay for medical insurance, sometimes for dental, life, and disability. There's usually some sort of retirement plan. They expect to give you some number of vacation days, holidays, and sick days where they pay you even though you're not working. Companies sometimes offer other benefits, like discounts on buying company products, membership in health clubs, etc. Capital: Often the company has to provide you with some sort of equipment, like a computer; furniture, like a chair and desk; etc. As far as the company is concerned, all of the above are part of the cost of having you as an employee. If they would pay a domestic employee $60,000 in salary and $20,000 in taxes, then assuming the same benefits and capital investment, if a foreign employee would cost them $0 in taxes they should logically be willing to pay $80,000. Any big company will have accountants who figure out the total cost of a new employee in excruciating detail, and they will likely be totally rational about this. A smaller company might think, \"\"well, taxes don't really count ...\"\" This is irrational but people are not always rational. I don't know what benefits they are offering you, if any, and what equipment they will provide you with, if any. I also don't know what taxes, if any, a U.S. company has to pay when hiring a remote employee in a foreign country. If anybody on here knows the answer to that, please chime in. Balanced against that, the company likely sees disadvantages to hiring a foreign remote employee, too. Communication will be more difficult, which may result in inefficiency. My previous employer used some contractors in India and while there were certainly advantages, the language and time zone issues caused difficulties. There are almost certainly some international bureaucratic inconveniences they will have to deal with. Etc. So while you should certainly calculate what it would cost them to have a domestic employee doing the same job, that's not necessarily the end of the story. And ultimately it all comes down to negotiations. Even if the company knows that by the time they add in taxes and benefits and whatever, a domestic employee will cost them $100,000 a year, if they are absolutely convinced that they should be able to hire an Austrian for $60,000 a year, that might be the best offer you will get. You can point out the cost savings, and maybe they will concede the point and maybe not.\"" }, { "docid": "577475", "title": "", "text": "In short, I suggest you take a look at your W-4 form and adjust it properly. And yes you can claim your self as a dependent, unless someone else is claiming you. But here is a more detailed explanation of how it works. How Income Tax Works. While most people tend to only think about the tax system and the Internal Revenue Service (IRS) as the month of April approaches, it's actually a never-ending process. For our purposes, a good way to explain how the system works is to give an example of one American income earner, we will call him Joe. The tax process begins when Joe starts his new job. He and his employer agree on his compensation, which will be figured into his gross income at the end of the year. One of the first things he has to do when he's hired is fill out all of his tax forms, including a W-4 form. The W-4 form lists all of Joe's withholding allowance information, such as his number of dependents and child care expenses. The information on this form tells your employer just how much money it needs to withhold from your paycheck for federal income tax. The IRS says that you should check this form each year, as your tax situation may change from year to year. Once Joe is hired and given a salary, he can estimate how much he will pay in taxes for the year. Here's the formula: At the end of each pay period, Joe's company takes the withheld money, along with all of withheld tax money from all of its employees, and deposits the money in a Federal Reserve Bank. This is how the government maintains a steady stream of income while also drawing interest on your tax dollars. Toward the end of the tax year, Joe's company has to send him a W-2 form in the mail. This happens by January 31. This form details how much money Joe made during the last year and how much federal tax was withheld from his income. This information can also be found on Joe's last paycheck of the year, but he'll need to send the W-2 to the IRS for processing purposes. At some point between the time Joe receives his W-2 and April 15, Joe will have to fill out and return his taxes to one of the IRS service and processing centers. Once the IRS receives Joe's tax returns, an IRS employee keys in every piece of information on Joe's tax forms. This information is then stored in large magnetic tape machines. If Joe is due a tax refund, he is sent a check in the mail in the next few weeks. If Joe uses e-File or TeleFile, his refund can be direct-deposited into his bank account." }, { "docid": "420358", "title": "", "text": "Private equity is not entirely comprised of turnarounds, however, I understand what you're looking for, and I suggest you take some time to read this article: http://www.businessweek.com/printer/articles/22306-my-week-at-private-equity-boot-camp Note: the people who sit in offices and crunch numbers or figure out how to structure deals are generally the middle or lower-level staff of a firm. At the top of a firm, you generally have people who decide what the fund should be invested in, and what strategy they should use. PE is a business, and you should think of it that way. So, if it were your business, you'd naturally hire really smart guys to crunch numbers or come up with solutions. Then YOU look at these outputs and choose one to go with. Such is how an efficient PE firm runs." } ]

[ { "docid": "337071", "title": "", "text": "I wound up asking Mint over email so I'll share the answer I received: Thank you for contacting Mint.com. From my understand you want to know if Mint can transfer data to other Intuit products and vice versa. Let me address your concern based from what I can see on my tools. Upon confirming, while Mint and other Intuit products are under the same company, Mint.com is not yet integrated to other Intuit products. We’d like to thank you though for giving the idea to us. With this, we would know which future enhancements will our customers appreciate. We have forwarded your request/suggestion to our Product and Development team for their review. At this time though, we can't make any guarantee that your request/suggestion will get implemented as we must balance customer demand with resources and business objectives. Oops..." } ]

[ { "docid": "380851", "title": "", "text": "\"From Wikipedia: Usage Because EV is a capital structure-neutral metric, it is useful when comparing companies with diverse capital structures. Price/earnings ratios, for example, will be significantly more volatile in companies that are highly leveraged. Stock market investors use EV/EBITDA to compare returns between equivalent companies on a risk-adjusted basis. They can then superimpose their own choice of debt levels. In practice, equity investors may have difficulty accurately assessing EV if they do not have access to the market quotations of the company debt. It is not sufficient to substitute the book value of the debt because a) the market interest rates may have changed, and b) the market's perception of the risk of the loan may have changed since the debt was issued. Remember, the point of EV is to neutralize the different risks, and costs of different capital structures. Buyers of controlling interests in a business use EV to compare returns between businesses, as above. They also use the EV valuation (or a debt free cash free valuation) to determine how much to pay for the whole entity (not just the equity). They may want to change the capital structure once in control. Technical considerations Data availability Unlike market capitalization, where both the market price and the outstanding number of shares in issue are readily available and easy to find, it is virtually impossible to calculate an EV without making a number of adjustments to published data, including often subjective estimations of value: In practice, EV calculations rely on reasonable estimates of the market value of these components. For example, in many professional valuations: Avoiding temporal mismatches When using valuation multiples such as EV/EBITDA and EV/EBIT, the numerator should correspond to the denominator. The EV should, therefore, correspond to the market value of the assets that were used to generate the profits in question, excluding assets acquired (and including assets disposed) during a different financial reporting period. This requires restating EV for any mergers and acquisitions (whether paid in cash or equity), significant capital investments or significant changes in working capital occurring after or during the reporting period being examined. Ideally, multiples should be calculated using the market value of the weighted average capital employed of the company during the comparable financial period. When calculating multiples over different time periods (e.g. historic multiples vs forward multiples), EV should be adjusted to reflect the weighted average invested capital of the company in each period. In your question, you stated: The Market Cap is driven by the share price and the share price is determined by buyers and sellers who have access to data on cash and debts and factor that into their decision to buy or sell. Note the first point under \"\"Technical Considerations\"\" there and you will see that the \"\"access to data on cash and debts\"\" isn't quite accurate here so that is worth noting. As for alternatives, there are many other price ratios one could use such as price/earnings, price/book value, price/sales and others depending on how one wants to model the company. The better question is what kind of investing strategy is one wanting to use where there are probably hundreds of strategies at least. Let's take Apple as an example. Back on April 23, 2014 they announced earnings through March 29, 2014 which is nearly a month old when it was announced. Now a month later, one would have to estimate what changes would be made to things there. Thus, getting accurate real-time values isn't realistic. Discounted Cash Flow is another approach one can take of valuing a company in terms of its future earnings computed back to a present day lump sum.\"" }, { "docid": "545143", "title": "", "text": "\"Here's the slippage I was talking about - - - this is when I was trading DXO or around that time. the ultra shares----interesting read at least. \"\"Based on data from October 22, 2008 to January 26, 2009, the S&amp;P 500 had a daily standard deviation of 3.62%. If you were to invest in SDS, an UltraShort ETF which has the S&amp;P 500 as its underlying index, and were to hold it for a year, you should expect to lose between 34% and 74% of your money, if the S&amp;P 500 is flat for that period. This assumes that there are no transaction costs, and that the expense ratio is 0% (in fact, it's 0.91%.) My experiment also assumed that daily stock market returns follow a normal distribution. In fact, the the distribution of daily stock market returns is leptokurtotic (it has fat tails.) According to my mathematical intuition (the Ph.D. is in math, in case you were curious,) if I had performed the experiment with a leptokurtotic distribution, the losses would have been larger. Obviously, this could be checked, but the results are bad enough as it is.\"\" http://www.altenergystocks.com/archives/2009/02/ultrapromises_fall_short.html\"" }, { "docid": "294496", "title": "", "text": "The solution is most definitely not P2P. Do you remember when Skype used P2P to route its traffic through your home internet, slowing your browsing and streaming? Imagine if YouTube used P2P distribution. This also doesn't work for serving up new videos, as you absolutely NEED an updating main page with DNS in order to disseminate new content even if you're going to share it via P2P. There are no websites out there that work solely via P2P torrenting. Site hosting costs money. YouTube historically has been operating at a loss because of its massive hosting bills. They're providing a service for you to consume for free. It's naive to think that P2P solves this cost issue. Even if you somehow implemented a site that used P2P DNS and P2P web traffic, it'd still require the end-user to pay money in order to host it. It would just offset the costs from the website-owner to the website-user, and create a ton of negative externalities. Your internet connection would be tied down by other people accessing content, and you'd likely see data caps instituted and your monthly ISP bill would go up. We have a workable tradeoff at the moment, and it's taken popular sites a while to make it so. Ads pay for your web experience, and they will continue to do so until the majority of users are comfortable with a site-based subscription model." }, { "docid": "14162", "title": "", "text": "\"In a way I would almost welcome it becuase ibeleive the outrage from so many millions might actually generate the groundswell public reaction we need to drastically limit software patents. It's outrageous. U.S. Patent No. 5,946,647 on a \"\"system and method for performing an action on a structure in computer-generated data\"\" (in its complaint, Apple provides examples such as the recognition of \"\"phone numbers, post-office addresses and dates\"\" and the ability to perform \"\"related actions with that data\"\"; one example is that \"\"the system may receive data that includes a phone number, highlight it for a user, and then, in response to a user's interaction with the highlighted text, offer the user the choice of making a phone call to the number\"\") every fing computer has done that for ever. U.S. Patent No. 6,343,263 on a \"\"real-time signal processing system for serially transmitted data\"\" (while this sounds like a pure hardware patent, there are various references in it to logical connections, drivers, programs; in its complaint, Apple said that this patent \"\"relates generally to providing programming abstraction layers for real-time processing applications\"\") so vague as to be anything apple wants yet so low level that obviously premempted by every prior serial data receiver which is every analog and digital radio receiver EVER.\"" }, { "docid": "188220", "title": "", "text": "Profits and losses in a partnership, LLC or S-corp are always reported proportional to the share of ownership. If you have a 30% share in a partnership, you will report 30% of the profit (or loss) of the respective tax year on your personal return. If you look at Part II, section J of your K-1, it should show your percentage of ownership in the entity. All numbers in Part III should reflect the amount of your share (not the entity's total amounts, which will be on Form 1065 for a partnership):" }, { "docid": "409960", "title": "", "text": "Sure user data is valuable. But valuable enough to be their business model? The math doesn't add up. If the data is that valuable, then why even charge users in the first place? Letting people in free would certainly generate even more data. Definitely more than what they would have gotten at their $10 price point. If they get twice as many people to jump in at the free price level (not a far fetched assumption) then they would make enough additional money to justify giving it away. And after a certain point, additional data stops being statistically significant while costs continue to mount paying for all those additional tickets. Furthermore, the CEO has already said that their business model is to share the additional revenue with the theaters. I'm not saying that they won't mine their data. They would be fools not to. And they will definitely be able to monetize it. But it's not possible for that alone to be their business model. How can it? Every time they send someone to a new movie, it costs them the full ticket price." }, { "docid": "328341", "title": "", "text": "An LLC does not pay taxes on profits. As regards tax a LLC is treated as a Partnership, but instead of partners they are called members. The LLC is a passthrough entity. As in Partnerships members can have a different percentage ownership to the share of profits. The LLC reports the share of the profits of the members. Then the members pay the tax as an individual. The profit of the LLC is deemed to have been transferred to the members regardless of any funds transferred. This is often the case as the LLC may need to retain the profits for use in the business. Late paying customers may mean there is less cash in the LLC than is available to distribute. The first answer is wrong, only a C corporation files a tax return. All other corporate structures are passthrough entities. The C corporation pays corporation tax and is not required to pass any funds to the shareholders. If the C corporation passes funds to the shareholders this is a dividend, and taxable to the shareholder, hence double taxation." }, { "docid": "587033", "title": "", "text": "\"Seriously, have you ever actually done any research on the CPI before making such silly claims? &gt;This is also kind of glossing over the fact that the CPI essentially makes the bold argument that energy and transportation prices never affect inflation. From the CPI website - http://www.bls.gov/cpi/cpifaq.htm#Question_9 &gt;Which index is the \"\"Official CPI\"\" reported in the media? Our broadest and most comprehensive CPI is called the All Items Consumer Price Index for All Urban Consumers (CPI-U) for the U.S. City Average, 1982-84 = 100. &gt;In addition to the All Items CPI, BLS publishes thousands of other consumer price indexes. One such index is called \"\"All items less food and energy\"\". Some users of CPI data use this index because food and energy prices are relatively volatile, and these users want to focus on what they perceive to be the \"\"core\"\" or \"\"underlying\"\" rate of inflation. &gt;Again, while we publish many indexes, our broadest measure of inflation includes all items consumers purchase, including food and energy. In addition, when CPI data are reported, these data can be reported on a not seasonally adjusted basis as well as a seasonally adjusted basis. Often, the media will report some, or all, of the following:\"" }, { "docid": "348445", "title": "", "text": "In short (pun intended), the shareholder lending the shares does not believe that the shares will fall, even though the potential investor does. The shareholder believes that the shares will rise. Because the two individuals believe that a different outcome will occur, they are able to make a trade. By using the available data in the market, they have arrived at a particular conclusion of the fair price for the trade, but each individual wants to be on the other side of it. Consider a simpler form of your question: Why would a shareholder agree to sell his/her shares? Why don't they just wait to sell, when the price is higher? After all, that is why the buyer wants to purchase the shares. On review, I realize I've only stated here why the original shareholder wouldn't simply sell and rebuy the share themselves (because they have a different view of the market). As to why they would actually allow the trade to occur - Zak (and other answers) point out that the shares being lent are compensated for by an initial fee on the transaction + the chance for interest during the period that the shares are owed for." }, { "docid": "286654", "title": "", "text": "\"In most jurisdictions, both the goods (raw materials) and the service (class) are being \"\"sold\"\" to the customer, who is the end user and thus the sale is subject to sales tax. So, when your friend charges for the class, that $100 is subject to all applicable sales taxes for the jurisdiction and all parent jurisdictions (usually city, county and state). The teacher should not have to pay sales tax when they buy the flowers from the wholesaler; most jurisdictions charge sales tax on end-user purchases only. However, they are required to have some proof of sales tax exemption for the purchase, which normally comes part and parcel with the DBA or other business entity registration paperwork in most cities/states. Wholesalers deal with non-end-user sales (exempt from sales tax) all the time, but your average Michael's or Hobby Lobby may not be able to deal with this and may have to charge your friend the sales tax at POS. Depending on the jurisdiction, if this happens, your friend may be able to reduce the amount the customer is paying that is subject to sales tax by the pre-tax value of the materials the customer has paid for, which your friend already paid the tax on.\"" }, { "docid": "282456", "title": "", "text": "\"Some banks allow mint.com read-only access via a separate \"\"access code\"\" that a customer can create. This would still allow an attacker to find out how much money you have and transaction details, and may have knowledge of some other information (your account number perhaps, your address, etc). The problem with even this read-only access is that many banks also allow users at other banks to set up a direct debit authorization which allows withdrawals. And to set the direct debit link up, the main hurdle is to be able to correctly identify the dates and amounts of two small test deposit transactions, which could be done with just read-only access. Most banks only support a single full access password per account, and there you have a bigger potential risk of actual fraudulent activity. But if you discover such activity and report it in a timely manner, you should be refunded. Make sure to check your account frequently. Also make sure to change your passwords once in a while.\"" }, { "docid": "363726", "title": "", "text": "\"Mint is one alternative. If you want the raw data in CSV format, you can use \"\"Export\"\" feature under\"" }, { "docid": "39625", "title": "", "text": "I'm a pretty big Yelp user. I have been frequenting a new local business and have come to understand how their reviews get filtered to help them. It's very simple to get the filtered reviews to come up on the main page. If you sign up and do one review it will be on the main page for a little while, a week or two, then drop off. They give the new user time to start doing reviews and to become part of the community. If there is no other activity, they become filtered. To get them back to the main page all the user has to do is friend a few people and do some more reviews. Not many even. They are a small sandwich shop and know their regulars. I shared with them this simple information and I have seen their page go from two reviews to seven. They just asked their customers to review other places and their reviews came back. The Yelp system is to stop the one review and done people. It works the same for bad reviews as well." }, { "docid": "122822", "title": "", "text": "Every child is obsessed with video games. It’s awesome. These games allow the young minds to explore strange worlds, become cool characters with mind blowing powers. Wouldn’t it be great if these children were allowed to create a game of their own? In many game design summit for kids, they are taught animation and video games using Scratch, Kodu, Unity, Game salad, and many other user-friendly software, easily allowing the kids to harness the power of coding. Visit us online here: https://www.youtube.com/watch?v=Qq3q2hnJJQ8&amp;feature=youtu.be" }, { "docid": "219043", "title": "", "text": "If I appear to be attacking you, I apologize up front because that's not my intent. * Windows phone has a market share of 2.5% and it's falling. Their market share is more closely compared with Blackberry than with Android or iOS. In addition, they are really only releasing low end phones and there are no known high end phones scheduled. * Office may be better but Blackberry was leading edge and 10 years later, they're pretty much gone. As a developer who has worked with Office products since Office 4.3 back in the 90's, there are just too many components that are clearly 10-15 years old that have not been updated. From data importing to VBA, there is just too much in there that they're just milking for as long as they can. I would add that when they introduced the Office subscription service in 2012, they told users that it was better to buy the subscription instead of buying the software outright because they would be constantly providing functional improvements like Google docs. That simply hasn't happened as there has been nothing but bug fixes for two years. * Azure may have a nice console (it's from 2011) but I'm here to tell you that working with Azure can be downright painful compared to AWS. Whether it's the firewall between two servers, SQL Azure data synch (in beta for 1.5 years and counting...seriously MS, what the f are you doing with that anyway?) to paid support (if you think Comcast ignores you, you aint seen nothing yet), they clearly are working in silos and not listening to their customers. * As for Windows 8, by their own admission, it's been a disaster and has really harmed their brand. 8.1 has brought back some much needed functionality but they need to make Windows 9 a winner, release it immediately and get everyone on it asap." }, { "docid": "504785", "title": "", "text": "In such a situation, is it really safe to give financial info to a person who does not encrypt it? Encryption only helps to an extent. i.e. during transmission of data or during brute force makes it more difficult to get the real data. However you concern is more of staff using this data, which encryption will not help much as they would be able to decrypt and see the data. In what ways could it be misused? This depends on the type of data. The financial data can be used to hack into your accounts if other bits of info are known. i.e. most of the times on Telephone requests; say putting card on hold, requesting balance on account, etc; only your address, mother maiden name, last few transaction details are asked. Some critical requests need more ID proofs; so generally not of concern. The other misuse would be selling this to marketing companies, so that you can be bombarded with sales pitch for anything and everything. The PAN and other ID documents are becoming more prone to mis-use. i.e. give a copy of PAN to open fraudulent accounts etc. A good practise would be to mark every copy of ID proof you give with the purpose as to why its given and a date. This would make the ID proof stale to an extent. If she is not going to encrypt it, should I ask her to delete all my old data and then create a new profile for my communication with her; the new profile not being my name, but a fake name? The regulations would not allow her to create fake accounts and may lead to issues and as such any recognised financial advisor would not allow this to be done. Quite a few countries have regulations for financial advisor's that need to be adhered to." }, { "docid": "279782", "title": "", "text": "\"Usually insiders are in a better position than you to understand their business, but that doesn't mean they will know the future with perfect accuracy. Sometimes they are wrong, sometimes life events force them to liquidate an otherwise promising investment, sometimes their minds change. So while it is indeed valuable information, as everything in fundamental analysis it must be taken with a grain of salt. Automatic Sell I think these refer to how the sell occurred. Often the employees don't get actual shares but options or warrants that can be converted to shares. Or there may be special predetermined arrangements regarding when and how the shares may be traded. Since the decision to sell here has nothing to do with the prospects of the business, but has to do with the personal situation of the employee, it's not quite the same as outright selling due to market concerns. Some people, for instance, are not interested in holding stock. Part of their compensation is given in stock, so they immediately sell the stock to avoid the headache of watching an investment. This obviously doesn't indicate that they expect the company will go south. I think automatic sell refers to these sorts of situations, but your broker should provide a more detailed definition. Disposition (Non Open Market) These days people trade through a broker, but there's nothing stopping you from taking the physical shares and giving them to someone in exchange for say a stack of cash. With a broker, you only \"\"sell\"\" without considering who is buying. The broker then finds buyers for you according to their own system. If selling without a broker you can also be choosy with who is buying, and it's not like anybody can just call up the CEO and ask to buy some stock, so it's a non-open market. Ultimately though it's still the insider selling. Just on a different exchange. So I would treat this as any insider sell - if they are selling, they may be expecting the stock to become less valuable. indirect ownership I think this refers to owning an entity that in turn owns the asset. For instance CEO of XYZ owns stock in ACME, but ACME holds shares of XYZ. This is a somewhat complicated situation, it comes down to whether you think they sold ACME because of the exposure to XYZ or because of some other risk that applies only to ACME and not XYZ. Generally speaking, I don't think you would find a rule like \"\"if insider transactions of so and so kinds > X then buy\"\" that provides guaranteed success. If such a rule was possible it would have been exploited already by the professionals. The more sensible option is to consider all data available to you and try to make a holistic evaluation. All of these insider activities can be bullish or bearish depending on many other factors.\"" }, { "docid": "445039", "title": "", "text": "\"Why are there so many stock exchanges in the world? The simple answer is that there is a lot of money to be made by charging fees to facilitate the trading of securities, but there are other factors at play here relating to new technologies. Trading volumes have increased rapidly in recent years. According to this ITG data, in 1997, 6.5 billion shares were traded on US exchanges. By 2015 this number had increased to 40.8 billion shares. There are a number of reasons for this rapid increase in volumes. Most significant would be the introduction of new technologies that allow for high volume, high frequency trading. This increase in activity has be accompanied by an increase in the number of stock exchanges. As CQM points out in his answer, there has been considerable consolidation in the ownership of \"\"legacy\"\" exchanges. For example, the NYSE merged with EuroNext in 2007, and the combined group is now owned by the Intercontinental Exchange, which also owns numerous smaller stock exchanges as well as a number of derivative/commodities exchanges. However, this consolidation in ownership has been more than matched by the creation of many \"\"virtual\"\" exchanges. In North America these virtual exchanges are called \"\"Alternative Trading Systems\"\". In Europe, they are called \"\"Multilateral Trading Facilities\"\". These new virtual exchanges, sometimes referred to as \"\"dark pools\"\", have begun to significantly eat away at the volumes of the legacy exchanges. If you look at the ITG data (linked above), you will see that the total volume of shares traded on legacy exchanges actually peaked in 2008, and has since then has decreased. This coincides roughly with the appearance of the virtual exchanges and the new high frequency trading methods. According to this paper from the SEC site, dated 2013, Alternative Trading Systems accounted for 11.3% of total volumes in 2012. This will have increased rapidly in the years since 2012. It is this loss of business that has prompted the consolidation in the ownership of the legacy exchanges. These new exchange are \"\"conceptually the same\"\" as the legacy exchanges and must play by the same regulatory rules.\"" }, { "docid": "265747", "title": "", "text": "\"These services and other employee perks are referred to as fringe benefits. An employee \"\"fringe benefit\"\" is a form of pay other than money for the performance of services by employees. Any fringe benefit provided to an employee is taxable income for that person unless the tax law specifically excludes it from taxation. One example of taxable fringe benefit is award/prize money (to prevent someone from \"\"winning\"\" most of their salary tax-free.) Cash awards are taxable unless given to charity. Non-cash awards are taxable unless nominal in value or given to charity. A less intuitive example is clothing. Clothing given to employees that is suitable for street wear is a taxable fringe benefit. Your example possibly fits under de minims (low-cost) fringe benefits such as low-value birthday or holiday gifts, event tickets, traditional awards (such as a retirement gift), other special occasion gifts, and coffee and soft drinks working condition fringe benefits--that is, property and services provided to an employee so that the employee can perform his or her job. Note that \"\"cafeteria plans\"\" in the source don't refer to cafeteria but allow employee choice between benefit options available.\"" } ]

[ { "docid": "466037", "title": "", "text": "You are describing a corporation. You can set up a corporation to perform business, but if you were using the money for any personal reasons the courts could Pierce the corporate veil and hold you personally liable. Also, setting up a corporation for purely personal reasons is fraud." } ]

[ { "docid": "527990", "title": "", "text": "\"Right, as I stated I agree that it will cause greater variance from the true intrinsic value for individual equities. To take this example to an extreme, traders can throw darts at a board of ticker symbols, purchase them, and still diversify away most firm specific risk. You're correct in stating that such a strategy will eventually cause systematic market failures if everyone does it, but the herd goes where they can make the most profit, and right now that is with ETFs. When fund managers prove they have foresight enough to exploit any systematic failures that this causes, or can start beating ETF returns, the herd will flock back to them. I only meant to point out the reasoning behind why this is happening, not advocating one over the other, and also to point out that Paul Singer shouldn't whine. To re-purpose an old saying, \"\"Don't get mad, get even (by making your investors rich).\"\"\"" }, { "docid": "378871", "title": "", "text": "This is a wonderful comprehensive answer as it relates to transferring goods, and evaluating profitability. I would like to add to your post and comment about a few other costs that are transferred. First though, I disagree with your comment about transfer pricing being about opportunity cost. I think transfer pricing is first and primarily about the matching principal. Properly matching expenses incurred to the revenues generated from those expenditures, or in the case of period expenses, to those entities that received a benefit in the proper period. I don't work in tax, so I'm by no means an expert in this subject, but I am a CPA and I feel I have a solid understanding of the subject. Some additional items going through TP might be: interest, shared corporate services, the amortization of intellectual property, technology fees, and depreciation charges. This is not a comprehensive list, and please don't take it as such. None of these need apply to every company, and certain industries and even individual companies will have exceptions. For example, for various reasons, a multi-national conglomerate may choose to maintain separate treasury functions for it's vastly different businesses, so you may not see much interest TP. Interest is pretty straight forward, and is the interest a company is paying on a debt. Not all interest is transferable, but a classic example might be borrowed funds used for an acquisition. The interest cost associated with that should be transferred in part back to the original entity. Short term borrowing costs used for operating capital is another classic example. Shared corporate services are centralized functions like a legal department, accounting department, executive offices, and the like. This can also be an IT department or in the instance of an international website (maybe google), an operations team monitoring the server loads and up-times. IP could just be patents that have definite lives that a number of businesses are benefiting from. IP is a bit of a mess to get into for various reasons and I'm trying to stay focused in this post. Some reasons for complexity include: the valuation, life of the asset, benefit of use, is the entity even really using it?, etc. I would imagine this is where companies get away with A LOT. Technology fees can be software licenses (Windows ain't free). Depreciation can be capitalized proprietary software. I'm running out of gas and wanted to comment about OP's question. I don't think SLA's and Internal billing services are a matter of directly increasing efficiency, more a matter of not creating inefficiencies. Going anecdotal, anywhere I've worked, the best person to do the job has been whoever's closest to the work. It wouldn't make much sense to me to have accounting gather up internal support during the VERY time sensitive month-end close for something like one division's trade magazine that another division placed an ad in. On the other hand, I think the allocation of copy expenses on an activity basis is an absolute waste of time. It all depends on the specific transaction in question. Great post bctich. Don't mean to detract, just looking to help others understand." }, { "docid": "481683", "title": "", "text": "\"Here are my reasons as to why bonds are considered to be a reasonable investment. While it is true that, on average over a sufficiently long period of time, stocks do have a high expected return, it is important to realize that bonds are a different type of financial instrument that stocks, and have features that are attractive to certain types of investors. The purpose of buying bonds is to convert a lump sum of currency into a series of future cash flows. This is in and of itself valuable to the issuer because they would prefer to have the lump sum today, rather than at some point in the future. So we generally don't say that we've \"\"lost\"\" the money, we say that we are purchasing a series of future payments, and we would only do this if it were more valuable to us than having the money in hand. Unlike stocks, where you are compensated with dividends and equity to take on the risks and rewards of ownership, and unlike a savings account (which is much different that a bond), where you are only being paid interest for the time value of your money while the bank lends it out at their risk, when you buy a bond you are putting your money at risk in order to provide financing to the issuer. It is also important to realize that there is a much higher risk that stocks will lose value, and you have to compare the risk-adjusted return, and not the nominal return, for stocks to the risk-adjusted return for bonds, since with investment-grade bonds there is generally a very low risk of default. While the returns being offered may not seem attractive to you individually, it is not reasonable to say that the returns offered by the issuer are insufficient in general, because both when the bonds are issued and then subsequently traded on a secondary market (which is done fairly easily), they function as a market. That is to say that sellers always want a higher price (resulting in a lower return), and buyers always want to receive a higher return (requiring a lower price). So while some sellers and buyers will be able to agree on a mutually acceptable price (such that a transaction occurs), there will almost always be some buyers and sellers who also do not enter into transactions because they are demanding a lower/higher price. The fact that a market exists indicates that enough investors are willing to accept the returns that are being offered by sellers. Bonds can be helpful in that as a class of assets, they are less risky than stocks. Additionally, bonds are paid back to investors ahead of equity, so in the case of a failing company or public entity, bondholders may be paid even if stockholders lose all their money. As a result, bonds can be a preferred way to make money on a company or government entity that is able to pay its bills, but has trouble generating any profits. Some investors have specific reasons why they may prefer a lower risk over time to maximizing their returns. For example, a government or pension fund or a university may be aware of financial payments that they will be required to make in a particular year in the future, and may purchase bonds that mature in that year. They may not be willing to take the risk that in that year, the stock market will fall, which could force them to reduce their principal to make the payments. Other individual investors may be close to a significant life event that can be predicted, such as college or retirement, and may not want to take on the risk of stocks. In the case of very large investors such as national governments, they are often looking for capital preservation to hedge against inflation and forex risk, rather than to \"\"make money\"\". Additionally, it is important to remember that until relatively recently in the developed world, and still to this day in many developing countries, people have been willing to pay banks and financial institutions to hold their money, and in the context of the global bond market, there are many people around the world who are willing to buy bonds and receive a very low rate of return on T-Bills, for example, because they are considered a very safe investment due to the creditworthiness of the USA, as well as the stability of the dollar, especially if inflation is very high in the investor's home country. For example, I once lived in an African country where inflation was 60-80% per year. This means if I had $100 today, I could buy $100 worth of goods, but by next year, I might need $160 to buy the same goods I could buy for $100 today. So you can see why simply being able to preserve the value of my money in a bond denominated in USA currency would be valuable in that case, because the alternative is so bad. So not all bondholders want to be owners or make as much money as possible, some just want a safe place to put their money. Also, it is true for both stocks and bonds that you are trading a lump sum of money today for payments over time, although for stocks this is a different kind of payment (dividends), and you only get paid if the company makes money. This is not specific to bonds. In most other cases when a stock price appreciates, this is to reflect new information not previously known, or earnings retained by the company rather than paid out as dividends. Most of the financial instruments where you can \"\"make\"\" money immediately are speculative, where two people are betting against each other, and one has to lose money for the other to make money. Again, it's not reasonable to say that any type of financial instrument is the \"\"worst\"\". They function differently, serve different purposes, and have different features that may or may not fit your needs and preferences. You seem to be saying that you simply don't find bond returns high enough to be attractive to you. That may be true, since different people have different investment objectives, risk tolerance, and preference for having money now versus more money later. However, some of your statements don't seem to be supported by facts. For example, retail banks are not highly profitable as an industry, so they are not making thousands of times what they are paying you. They also need to pay all of their operating expenses, as well as account for default risk and inflation, out of the different between what they lend and what they pay to savings account holders. Also, it's not reasonable to say that bonds are worthless, as I've explained. The world disagrees with you. If they agreed with you, they would stop buying bonds, and the people who need financing would have to lower bond prices until people became interested again. That is part of how markets work. In fact, much of the reason that bond yields are so low right now is that there has been such high global demand for safe investments like bonds, especially from other nations, such that bond issues (especially the US government) have not needed to pay high yields in order to raise money.\"" }, { "docid": "144563", "title": "", "text": "The thing you get wrong is that you think the LLC doesn't pay taxes on gains when it sells assets. It does. In fact, in many countries LLC are considered separate entities for tax properties and you have double taxation - the LLC pays its own taxes, and then when you withdraw the money from the LLC to your own account (i.e.: take dividends) - you pay income tax on the withdrawal again. Corporate entities usually do not have preferential tax treatment for investments. In the US, LLC is a pass-though entity (unless explicitly chosen to be taxed as a corporation, and then the above scenario happens). Pass-through entities (LLCs and partnerships) don't pay taxes, but instead report the gains to the owners, which then pay taxes as if the transaction was their personal one. So if you're in the US - investing under LLC would have no effect whatsoever on your taxes, or adverse effect if you chose to treat it as a corporation. In any case, investing in stocks is not a deductible expense, and as such doesn't reduce profits." }, { "docid": "589123", "title": "", "text": "\"As you said, in the US LLC is (usually, unless you elect otherwise) not a separate tax entity. As such, the question \"\"Does a US LLC owned by a non-resident alien have to pay US taxes\"\" has no meaning. A US LLC, regardless of who owns it, doesn't pay US income taxes. States are different. Some States do tax LLCs (for example, California), so if you intend to operate in such a State - you need to verify that the extra tax the LLC would pay on top of your personal tax is worth it for you. As I mentioned in the comment, you need to check your decision making very carefully. LLC you create in the US may or may not be recognized as a separate legal/tax entity in your home country. So while you neither gain nor lose anything in the US (since the LLC is transparent tax wise), you may get hit by extra taxes at home if they see the LLC as a non-transparent corporate entity. Also, keep in mind that the liability protection by the LLC usually doesn't cover your own misdeeds. So if you sell products of your own work, the LLC may end up being completely worthless and will only add complexity to your business. I suggest you check all these with a reputable attorney. Not one whose business is to set up LLCs, these are going to tell you anything you want to hear as long as you hire them to do their thing. Talk to one who will not benefit from your decision either way and can provide an unbiased advice.\"" }, { "docid": "592484", "title": "", "text": "\"Such data is typically only available from paid sources due to the amount of research involved in determining the identity of delisted securities, surviving entities in merger scenarios, company name changes, symbol changes, listing venue changes, research of all capital events such as splits, and to ensure that the data coverage is complete. Many stocks that are delisted from a major exchange due to financial difficulties are still publicly tradeable companies with their continuing to trade as \"\"OTC\"\" shares. Some large companies even have periods where they traded for a period of their history as OTC. This happened to NYSE:NAV (Navistar) from Feb 2007 to July 2008, where they were delisted due to accounting statement inaccuracies and auditor difficulties. In the case of Macromedia, it was listed on NASDAQ 13 Dec 1993 and had its final day of trading on 2 Dec 2005. It had one stock split (2:1) with ex-date of 16 Oct 1995 and no dividends were ever paid. Other companies are harder to find. For example, the bankrupt General Motors (was NYSE:GM) became Motoros Liquidation Corp (OTC:MTLQQ) and traded that way for almost 21 months before finally delisting. In mergers, there are in two (or more) entities - one surviving entity and one (or more) delisted entity. In demergers/spinoffs there are two (or more) entities - one that continues the capital structure of the original company and the other newly formed spun-off entity. Just using the names of the companies is no indication of its history. For example, due to monopoly considerations, AT&T were forced to spinoff multiple companies in 1984 and effectively became 75% smaller. One of the companies they spunoff was Southwestern Bell Corporation, which became SBC Communications in 1995. In 2005 SBC took over its former parent company and immediately changed its name to AT&T. So now we have two AT&Ts - one that was delisted in 2005 and another that exists to this day. Disclosure: I am a co-owner of Norgate Data (Premium Data), a data vendor in this area.\"" }, { "docid": "574941", "title": "", "text": "Awesome info, this is what I was looking for. I live in FL so i will look into LLC laws. Is there a difference in obtaining loans for multi-unit properties, or any special requirements? This would be my first purchase so I'm trying to decide if I should start with a multi-unit or a large home. I read something about a first time home buyers and the FHA allowing one to put down less of an initial investment. Im assuming this is if you are actually going to be living in the home or property? Would it make sense to have separate entities for specific types of units? For example One separate corporation per multi-unit property, but have multiple single family homes under another single entity? Thanks for the help. *quick add-on, would you know how long the corporation would have had to exist before being able to obtain a loan? For example, would XYZ, LLC. have to have been around for 3 years prior to the loan, or could i just incorporate the month before going to the bank?" }, { "docid": "18950", "title": "", "text": "I don't know the term sole trader but usually the trade off is a corporation allows for shield from liability (i.e. creditors) more flexibility with respect to personal tax management, but higher operating costs (incorporation, financial statements, etc). I always incorporate." }, { "docid": "262970", "title": "", "text": "\"&gt; But currently they don't even receive that. Yes, because everyone knows America has people starving in the streets left and right. I'm certainly an advocate for stronger social safety nets, but you are being unrealistic if you say we don't have millions of programs to feed and shelter people. Usually the only true homeless in this country are mentally ill. But that is a separate discussion. I am in no way against helping the poverty class as much as possible, especially with education. &gt; The systematic transfer of wealth from labor to capital nowadays plays no part? It's not a \"\"transfer.\"\" That doesn't even make any sense, I'd like to see you explain the logic behind that. The capital markets are stronger than ever before because the global labor market is exploding, and America is still the cornerstone of the global financial markets. The labor markets are weakening because, again, we are losing out to global competitors and technology. One goes up and the other goes down because of the same factor. One doesn't *cause* the other.\"" }, { "docid": "483588", "title": "", "text": "That's exactly what immunofort is saying, and it lines up with established financial theory (well, some of it). The general argument is that stocks are priced according to what risks they're exposed to. Several (although not all) of the major financial economics theories propose (and find empirical evidence for this) that the market as whole is a risk factor, so individual stocks would be priced in part based on how correlated they are with the market. Strictly speaking, the risk free rate is purely theoretical and can't be directly observed, but the US T-bill yield is usually considered to be a pretty good proxy for it." }, { "docid": "219398", "title": "", "text": "Bitcoin can facilitate this, despite the risks associated with using bitcoin exchanges and the price volatility at any given time. The speed of bitcoin can limit your exposure to the bitcoin network to one hour. Cyprus has a more advanced infrastructure than most countries to support bitcoin transactions, with Neo & Bee opening as a regulated bank/financial entity in Cyprus just two months ago, and ATM/Vending Machines existing for that asset. Anyway, you acquire bitcoin from an individual locally (in exchange for cash) or an exchange that does not require the same level of reporting as a bank account in Cyprus or Russia. No matter how you acquire the bitcoin, you transfer it to the exchange, sell bitcoin on the exchange for your desired currency (USD, EURO, etc), you instruct the exchange to wire the EURO to your cyprus bank account using your cyprus account's SWIFT code. The end. Depending on the combination of countries involved, the exchange may still encounter similar withdrawal limitations until certain regulatory requirements are resolved. Also, I'm unsure of the attitude toward bitcoin related answers on this site, so I tried to add a disclaimer about bitcoin's risks at the top, but that doesn't make this answer incorrect." }, { "docid": "30299", "title": "", "text": "\"As indicated in comments, this is common practice in the US as well as EU. For example, in this Fox Business article, a user had basically the same experience: their card was replaced but without the specific merchant being disclosed. When the reporter contacted Visa, they were told: \"\"We also believe that the public interest is best served by quickly notifying financial institutions with the information necessary to protect themselves and their cardholders from fraud losses. Even a slight delay in notification to financial institutions could be costly,” the spokesperson said in an e-mail statement. “Visa works with the breached entity to collect the necessary information and provides payment card issuers with the affected account numbers so they can take steps to protect consumers through independent fraud monitoring, and if needed, reissuing cards. The most critical information needed is the affected accounts, which Visa works to provide as quickly as possible.” What they're not saying, of course, is that it's in Visa's best interests that merchants let Visa know right away when a leak occurs, without having to think about whether it's going to screw that merchant over in the press. If the merchant has to consider PR, they may not let the networks know in as timely of a fashion - they may at least wait until they've verified the issue in more detail, or even wait until they've found who to pin it on so they don't get blamed. But beyond that, the point is that it's easier for the network (Visa/Mastercard/etc.) to have a system that's just a list of card numbers to submit to the bank for re-issuing; nobody there really cares which merchant was at fault, they just want to re-issue the cards quickly. Letting you know who's at fault is separate. There's little reason for the issuing bank to ever know; you should find out from the merchant themselves or from the network (and in my experience, usually the former). Eventually you may well find out - the article suggest that: [T]he situation is common, but there is some good news: consumers do in many cases find out the source of the breach. But of course doesn't go into detail about numbers.\"" }, { "docid": "489433", "title": "", "text": "\"For allocation, there's rules of thumb. 120-age is the percentage some folks recommend for stock market (high risk) allocation. With the balance in bonds, and a bit of international fund to add some more diversity. However, everyone needs to determine how much risk they're willing to take, and what their horizon is. Once you figure out your allocation, determine how much of your surplus goes into investing, and how much goes into short term savings for your short term financial goals such as purchasing a home. I would highly recommend reading about \"\"Financial Independence, Retire Early\"\" (FIRE). Most of the articles I've seen on it were folks in the US, with the odd Canadian and Brit, but the principles should be able to work in the Netherlands with adjustment. The idea behind FIRE is that you adjust your lifestyle to minimize expenses and save as much of your income as possible. When the growth of your savings is > the amount you spend on a yearly basis, you've reached financial independence and can retire any time you wish. CD ladder is a good idea for your emergency fund, but CDs (at least in the US) usually pay around the same rate as inflation, give or take. A ladder would help you preserve your emergency fund.\"" }, { "docid": "431230", "title": "", "text": "You don't need a Visa to create or own US property. Your registered agent will be able to take care of most of this, and your new entity will use the registered agent's address where applicable, but you may need your own separate address which can be your office in the UK. If you want privacy then you'll want a separate address, which can also be a PO Box or an address the registered agent also provides. US corporations, especially in Delaware, have a lot more compliance issues than the LLC product. Delaware has a lot more costs for formation and annual reports than most other united states. There are definitely a lot of states to choose from, but more people will have information for Delaware." }, { "docid": "534277", "title": "", "text": "\"A C-Corp is not a pass-through entity, any applicable taxes would be paid by the Corporation, which is a separate legal entity from yourself. If you use the points to purchase something for yourself, that would constitute \"\"income\"\" to you, and would be taxable on your personal income tax.\"" }, { "docid": "251574", "title": "", "text": "\"&gt;Besides, if banks are so evil, why would I ever do any business with them? Are you not familiar with the phrase \"\"a necessary evil\"\"? You must understand that the major difference between borrowing from an individual and borrowing from a financial institution is that the latter factors the risk of default into its business model. The bank expects a certain percentage of its borrowers to default and manages its risk accordingly, which is why there are such things as credit scores and variable APRs in the first place. Your bank doesn't \"\"trust\"\" you any further than it could throw you.\"" }, { "docid": "359950", "title": "", "text": "\"Its a good question. Off the top of my head I would suggest to revoke their licenses to do business, and involuntary dissolution of the corporate entity. Mandatory sale of all assets including customer lists and other intangibles to the highest bidder. The entity would essentially be absorbed by other businesses in their industry so the industry and economy as a whole probably wouldn't be affected too much by the \"\"execution.\"\" The shareholders would lose a lot obviously because the proceeds from the fire sale would probably be way lower than FMV. But fuck the shareholders, investing carries risk and their business failed. The relatively innocent employees could go work in the other businesses that bought up OldCo's assets. Higher level corporate executives should have to take personal responsibility legally. This is similar to how SOX requires the CEO and CFO to take personal responsibility for the financial statements they prepare and publish, with penalties up to and including millions of dollars of fines and jail time. But of course, as long as I'm dreaming, I'd like a pony too as the saying goes.\"" }, { "docid": "458376", "title": "", "text": "There would be a catastrophic collapse in the financial industry. Not exaggerating. Every bank is a company that's technically held by another company, a bank holding company. Every investment firm typically has anywhere from dozens to thousands of separate little companies (depending on the size of the overall firm) that it uses to manage money and risk. There's ways to try and solve agency problems and moral hazard problems in corporate governance, but disallowing corporations from creating wholly owned subsidiaries is not the way to do it." }, { "docid": "227757", "title": "", "text": "\"I don't know what you mean by \"\"claim for taxes,\"\" I think you mean pay taxes. I'm not sure how corps function in Canada but in the US single owner limited liability entities typically pass the net income through to the owner to be included in their personal tax return. So it seems all of this is more or less moot, because really you should probably already be including your income sourced from this project on your personal taxes and that's not really likely to change if you formed something more formal. The formal business arrangements really exist to limit the liability of the business spilling over in to the owner's assets. Or trouble in the owner's life spilling over to interrupt the business operation. I don't know what kind of business this is, but it may make sense to set up one of the limited liability arrangements to ensure that business liability doesn't automatically mean personal liability. A sole proprietorship or in the US we have DBA (doing business as) paperwork will get you a separate tax id number, which may be beneficial if you ever have to provide a tax ID and don't want to use your individual ID; but this won't limit your liability the way incorporating does.\"" } ]

[ { "docid": "430901", "title": "", "text": "I checked this myself and there is no monetary penalty for late filing. However, since I am late I have to do all publication over again which costs me extra $50." } ]

[ { "docid": "568238", "title": "", "text": "Make sure to get a Homestead Exemption if your state has one. This can keep your taxes from rising quite as steeply, and in some cases the county assessment office can get you a retroactive refund when your application is approved. Also, if you really think you're paying too high based on home resale values around you, most county assessors will also let you dispute your valuation. A higher value is great if you intend to sell, not so good if you're staying long term. Kind of like the difference between trading bonds and investing in them. Also, as I think one of the other posters pointed out, you can usually make extra small payments and direct them to escrow or to principal." }, { "docid": "258611", "title": "", "text": "The cost will be around $300-$500 if you do it correctly it in Florida and can be over a $1,000 if you do it in New York (New York is more expensive due to a publication requirement that New York has for LLC’s). The price ranges I’ve given include filing, state fees, getting a tax ID number (EIN), operating agreement, membership certificates, registered agent fees and publication fees if done in New York. Each state also have licensing boards and city fees that are applicable, so you would want to also make sure that you are keeping compliant there. Yearly paperwork to keep the LLC running won’t be so expensive, expect the state to charge a yearly fee and require some basic information to be submitted. I had a quick look at Florida, and with someone filing it for you, expect around $200 to $250 a year, plus registered agent fees. If you are late in Florida the penalty is $400 so you definitely would want a service that provides compliance calendar notifications to make sure you are on time with fees. In regards to bookkeeping and taxes, yearly tax filing will start at $250 to $500 for an LLC and move up from there depending on the services being offered and the amount of time of work. I recently referred someone to an accountant that will charge $250 to file an almost zero tax return on an LLC. I think $40 an hour is a little low for a bookkeeper but it all depends on where you are. I know in some major cities bookkeepers expect $75 an hour or higher. So the expectation in Miami and Manhattan will probably be more expensive than Jacksonville and Albany. If you doing a little business don’t expect the cost to be too much on the bookkeeping. So, breakdown: $300-$500 (FL) - $1,000 (NY) Registration of LLC + any business license, city or other registrations $250 Yearly Fee + Yearly Registered Agent + any business licenses, city or other fee $500 Tax Return + Bookkeeping Fee Banks will charge more than a personal account so expect $120 a year plus. In regards to service I would look at companies that specialize in foreigners setting up businesses in the US, because they will have services designed to help you more than services that primarily specialize with US clients. You are going to have some different needs, based on not having a Social Security Number or establishing from overseas." }, { "docid": "504816", "title": "", "text": "I don't think the verbal confirmation from the branch manager is worth anything, unless you got it in writing it basically never happened. That said, what did you sign exactly? An application? I'd think they would be well within their rights to deny that, no matter what the branch manager said. If you actually signed a binding contract between you and the bank, things would be different but the fact that 'approval' was mentioned suggests that all you and the bank signed was an application and the bank manager made some unreasonable promises he or she doesn't want to be reminded of now. If the complaints department can't get off their collective backsides, a firm but polite letter to the CEO's office might help, or it might end up in the round filing cabinet. But it's worth a try. Other than that, if you are unhappy enough to go through the pain, you can try to remortgage with another bank and end the business relationship with your current bank." }, { "docid": "426462", "title": "", "text": "\"&gt;It's sad...when I hear young workers talk about their job application strategies, more often than not they involve figuring out how to \"\"fool\"\" the HR bots. LOL. It took me a second with your \"\"HR bots\"\" to realize you were talking about the software and not the HR personnel. Because I have always (even 30 years back) viewed HR as basically operating on a lot of faulty fundamental assumptions -- the BEST way to get hired (even back then, BEFORE the \"\"software application screening process\"\") was to do an \"\"end run around HR\"\". Part of the reason is that HR (or previously the \"\"Personnel Dept\"\") was really designed from the get-go only to fill the generic \"\"factory worker\"\" positions -- jobs that had minimal base-level skill requirements (i.e. the checkbox type stuff where any relatively intelligent person should be able to determine with a pretty high accuracy whether the candidates could do the job) -- in other words the open positions that were effectively \"\"commodities\"\", and where the turnover was high and/or the number of people employed fairly large. *But then...* a combination of HR wanting to be more \"\"professional\"\" combined with the advent of the \"\"generic MBA manager\"\" (who believes he/she can manage \"\"anything\"\" without specific domain knowledge or experience) created an opening for HR to take over the hiring of virtually ALL positions. So what we ended up with was the generic MBA manager (lacking domain knowledge/experience) shifting the responsibility (or at least most of it) for candidate filtering &amp; hiring off to generic HR people/processes (who pretty much by definition, lack domain knowledge/experience) -- and who then attempted to \"\"systematize\"\" the whole thing. Add in stuff like equal opportunity \"\"anti-discrimination\"\" laws (and lawsuits) to drive the \"\"generic-ization\"\" of the whole process... and you have the perfect pre-conditions for the storm that is the current fiasco. So we end up with generic (and lets face it, often ignorant) managers taking \"\"job requirements\"\" and coming up with checklist style \"\"help wanted ads\"\" (CS Degree, 5-10 years of Ruby on Rails work experience, etc)-- HR departments that are clueless about the validity/availability of those requirements pretty much just keying the crap into the ads &amp; application filtering software in a rote fashion -- and like a badly constructed Google search, it shouldn't be surprising that they come up with minimal \"\"results\"\". Of course within the \"\"discarded\"\" applicants are probably several potentially *excellent* hires -- but they will simply never be found. --- So... SMART people will (still? again?) do their best -- not to \"\"game\"\" the bots -- but to do an \"\"end run around\"\" the whole thing. And that means using your \"\"network\"\" to get your name in the door and your resume in the hands of the \"\"person that matters\"\" within the company (that may or just as often may NOT be the manager who makes the \"\"hiring decision\"\" -- it may very well be the most experienced person in his department; who then PUSHES the manager to interview and hire you) -- and you preferably do that BEFORE the damned ad is even written, and BEFORE the HR department is even aware that there is a \"\"need\"\" for a hire. (Keep in mind that there is often a span of several weeks, if not several months between the REAL awareness of a \"\"need\"\" and the manager/HR getting around to actually starting the \"\"help wanted\"\" fiasco-ridden process.) One key aspect of that is that -- via the \"\"in the door ahead of time\"\" -- even IF the company *requires* the HR process to be followed, the job spec can be \"\"constructed\"\" to match the pre-qualified candidate, and his/her resume can go to the top of the stack (already being in the manager's hands with a hearty recommendation/endorsement from one of his critical team members: i.e. \"\"HIRE this guy/gal!\"\") Unfortunately, it seems that -- for all the emphasis on \"\"networking\"\" these days -- colleges and other \"\"how to get hired\"\" classes, seldom (if ever) teach those techniques. *But if you ask around/look around within companies and identify the really \"\"good fit\"\" people, a LOT of them will have been hired by this method, and emphatically were NOT found via HR listings &amp; processes.*\"" }, { "docid": "525685", "title": "", "text": "\"Everything I have read here sounds good except for one small detail. My bank does indeed identify ATM rebates as taxable income. They, in fact, seemed to have begun this practice several years ago but somehow forgot to send 1099's to their own customers despite sending them to the IRS. This ended up costing me nearly $2,000 in back taxes to cover 2012, 2013 and 2014. My bank sent a letter of apology and will cover any penalties and interest accrued \"\"due to their error\"\". No one from the bank ever told me that these rebates could be taxable when I signed on for this special checking account for which I pay a fee each month to continue. So what is the truth, is it taxable income or not? I have now paid for the 2012 and 2013 tax years for something I still say is not income. I am about to pay the 2014 tax bill and will have to pay another $850 or so due to this ruling by my bank. How can this be right??\"" }, { "docid": "283539", "title": "", "text": "##Owsley County, Kentucky Owsley County is a county located in the Eastern Coalfield region of the U.S. state of Kentucky. As of the 2010 census, the population was 4,755, making it the second-least populous county in Kentucky. The county seat is Booneville. The county was organized on January 23, 1843 from Clay, Estill, and Breathitt counties and named for William Owsley (1782–1862), the judge of the Kentucky Court of Appeals and Governor of Kentucky (1844–48). *** ##Wilcox County, Alabama Wilcox County is a county of the U.S. state of Alabama. As of the 2010 census, the population was 11,670. Its county seat is Camden. *** ^[ [^PM](https://www.reddit.com/message/compose?to=kittens_from_space) ^| [^Exclude ^me](https://reddit.com/message/compose?to=WikiTextBot&amp;message=Excludeme&amp;subject=Excludeme) ^| [^Exclude ^from ^subreddit](https://np.reddit.com/r/economy/about/banned) ^| [^FAQ ^/ ^Information](https://np.reddit.com/r/WikiTextBot/wiki/index) ^] ^Downvote ^to ^remove" }, { "docid": "10089", "title": "", "text": "Congratulations on deciding to save for retirement. Since you cite Dave Ramsey as the source of your 15% number, what does he have to say about where to invest the money? If you want to have instantaneous penalty-free access to your retirement money, all you need to do is set up one or more ordinary accounts that you think of as your retirement money. Just be careful not to put the money into CDs since Federal law requires a penalty of three months interest if you cash in the CD before its maturity date (penalty!) or put the money into those pesky mutual funds that charge a redemption fee (penalty!) if you take the money out within x months of investing it where x can be anywhere from 3 to 24 or more. In Federal tax law (and in most state tax laws as well) a retirement account has special privileges accorded to it in that the interest, dividends, capital gains, etc earned on the money in your retirement account are not taxed in the year earned (as they would be in a non-retirement account), but the tax is either deferred till you withdraw money from the account (Traditional IRAs, 401ks etc) or is waived completely (Roth IRAs, Roth 401ks etc). In return for this special treatment, penalties are imposed (in addition to tax) if you withdraw money from your retirement account before age 59.5 which presumably is on the distant horizon for you. (There are some exceptions (including first-time home buying and extraordinary medical expenses) to this rule that I won't bother going into). But You are not required to invest your retirement money into such a specially privileged retirement account. It is perfectly legal to keep your retirement money in an ordinary savings account if you wish, and pay taxes on the interest each year. You can invest your retirement money into municipal bonds whose interest is free of Federal tax (and usually free of state tax as well if the municipality is located in your state of residence) if you like. You can keep your retirement money in a sock under your mattress if you like, or buy a collectible item (e.g. a painting) with it (this is not permitted in an IRA), etc. In short, if you are concerned about the penalties imposed by retirement accounts on early withdrawals, forgo the benefits of these accounts and put your retirement money elsewhere where there is no penalty for instant access. If you use a money management program such as Mint or Quicken, all you need to do is name one or more accounts or a portfolio as MyRetirementMoney and voila, it is done. But those accounts/portfolios don't have to be retirement accounts in the sense of tax law; they can be anything at all." }, { "docid": "80769", "title": "", "text": "I can't address Indian law but US law has no problems with you having savings accounts in India. Furthermore, there are no tax consequences from paying off the student loan. However there is big problem here--while the US has no rules against foreign bank accounts it has reporting rules that you certainly have violated (if you hadn't violated them you wouldn't be asking the question.) 1) Those foreign bank accounts must be listed on your tax return. 2) Those foreign bank accounts must be listed on a PDF that's filed with the (Financial Crimes Enforcement Network. (Yes, it's very stupid they need identical information sent to two different departments.) 2) The interest you earned on that bank account is income that should have been reported on your return. As for what to do about it--this is the realm where you get professional help. As for the outcome--since you didn't set out to cheat they have a much less harsh system set up. Expect to amend your 2012 and 2013 returns (and 2014 if you've already filed it), pay interest and late-payment penalties on the additional tax caused by the interest and pay a penalty of 5% of the highest total value of the accounts. Since the discovery of large amounts of money being hidden from the taxman in Swiss bank accounts Congress has gone 1000# gorilla about it and been pressuring foreign banks to cough up the details on any US-citizen or US-resident depositors." }, { "docid": "70009", "title": "", "text": "Ignorance - people might not pay attention to the value, or forgot that they had them. Fees - the gain could be too small and eaten away by fees, so it's cheaper to abandon them. Knowledge - people might not understand that they miss a chance to cash in Formal errors - when the execution is incorrectly filed and fails therefore, and the time is already run out when they realize." }, { "docid": "196374", "title": "", "text": "\"First to clear a few things up. It is definitely not a gift. The people are sending you money only because you are providing them with a service. And for tax purposes, it is not a \"\"Donation\"\". It has nothing to do with the fact that you are soliciting the donation, as charitable organizations solicit donations all the time. For tax purposes, it is not a \"\"Donation\"\" because you do not have 501(c)(3) non profit status. It is income. The question is then, is it \"\"Business\"\" income, or \"\"Hobby\"\" related income? Firstly, you haven't mentioned, but it's important to consider, how much money are you receiving from this monthly, or how much money do you expect to receive from this annually? If it's a minimal amount, say $50 a month or less, then you probably just want to treat it as a hobby. Mostly because with this level of income, it's not likely to be profitable. In that case, report the income and pay the tax. The tax you will owe will be minimal and will probably be less than the costs involved with setting up and running it as a business anyway. As a Hobby, you won't be able to deduct your expenses (server costs, etc...) unless you itemize your taxes on Schedule A. On the other hand if your income from this will be significantly more than $600/yr, now or in the near future, then you should consider running it as a business. Get it clear in your mind that it's a business, and that you intend it to be profitable. Perhaps it won't be profitable now, or even for a while. What's important at this point is that you intend it to be profitable. The IRS will consider, if it looks like a business, and it acts like a business, then it's probably a business... so make it so. Come up with a name for your business. Register the business with your state and/or county as necessary in your location. Get a bank account for your business. Get a separate Business PayPal account. Keep personal and business expenses (and income) separate. As a business, when you file your taxes, you will be able to file a Schedule C form even if you do not itemize your taxes on Schedule A. On Schedule C, you list and total your (business) income, and your (business) expenses, then you subtract the expenses from the income to calculate your profit (or loss). If your business income is more than your business expenses, you pay tax on the difference (the profit). If your business expenses are more than your business income, then you have a business loss. You would not have to pay any income tax on the business income, and you may be able to be carry the loss over to the next and following years. You may want to have a service do your taxes for you, but at this level, it is certainly something you could do yourself with some minimal consultations with an accountant.\"" }, { "docid": "65702", "title": "", "text": "\"Securities and ETFs are also subjected to Estate Tax. Some ways: Draft a \"\"Transfer on Death\"\" instruction to the broker, that triggers a transfer to an account in the beneficiary's name, in most cases avoiding probate. If the broker does not support it, find another broker. Give your brokerage and bank password/token to your beneficiary. Have him transfer out holdings within hours of death. Create a Trust, that survives even after death of an individual. P.S. ETF is treated as Stock (a company that owns other companies), regardless of the nature of the holdings. P.S.2 Above suggestions are only applicable to nonresident alien of the US.\"" }, { "docid": "35736", "title": "", "text": "\"Also posting here to get answers 1) In pre-university education, what do I list along with my A levels? Are AS levels and GCSEs necessary? 2) Should i upload a degree transcript? (they say its optional hence why i'm asking) 3) Does the answer to \"\"How did you hear about JPM/GS/CS/BAML?\"\" affect your application? (moronic i know, but i thought better to know than to be clueless) 4) Do your answers to the equal opportunities form affect your application? (just want to know since its almost accepted now that if youre not a white male, your application will get scrutinised in some way depending on the reader, and i'm not white) 5) Following on from the previous question, my first name is Mohammad so should I consider changing my name on my CV and application forms? Again because of the bad press that Muslims get, and since Mohammad is such an obvious Muslim name. I also speak an Asian language so should i list that on my form/CV? I know this sounds like I want to hide my identity, but believe me it's the last thing I want to do. It's just something I feel like I might have to do. Nor do I want any sympathy for doing this. It's something a friend of mine suggested and I want to get people's opinions.\"" }, { "docid": "300297", "title": "", "text": "\"To expand on what @fishinear and some others are saying: The only way to look at it is that the parents have invested, because the parents get a % of the property in the end, rather than the original loan amount plus interest. It is investment; it is not a loan of any kind. One way to understand this is to imagine that after 20 years, the property triples in value (or halves in value). The parents participate as if they had invested in 75% ownership of the property and the OP as if 25% ownership of the property. Note that with a loan, there is a (potentially changing) outstanding loan balance, that could be paid to end the loan (to pay off the loan), and there is an agreed upon an interest rate that is computed on the outstanding balance — none of those apply to this situation; further with a loan there is no % of the property: though the property may be used to secure the loan, that isn't ownership. Basically, since the situation bears none of the qualities of a loan, and yet does bear the qualities of investment, the parents have bought a % ownership of the property. The parents have invested in 75% of the real estate, and the OP is renting that 75% from them for: The total rent the OP is paying the parents for their 75% of the property is then (at least) $1012.50/mo, A rental rate of $1012.50/mo for 75% of the property equates to a rental price of $1350/mo for the whole property. This arrangement is only fair to both parties when the fair-market rental value of the whole property is $1350/mo; it is unfair to the OP when the fair-market rental value of property is less, and unfair to the parents when the fair-market rental value of property is more. Of course, the fair-market rental value of the property is variable over time, so the overall fairness would need to understand rental values over time. I feel like this isn't actually a loan if I can never build more equity in the condo. Am I missing something? No, it isn't a loan. You and your parents are co-investing in real estate. Further, you are renting their portion of the investment from them. For comparison, with a loan you have 100% ownership in the property from the start, so you, the owner, would see all the upside/downside as the property valuation changes over time whether the loan is paid off or not. The borrower owes the loan balance (and interest) not some % of the property. A loan may be secured by the property (using a lien) but that is quite different from ownership. Typically, a loan has a payment schedule setup to reduce the loan balance (steadily) over time so that you eventually pay it off. With a loan you gain equity % — the amount you own outright, free & clear — in two ways, (1) by gradually paying off the loan over time so the unencumbered portion of the property grows, and (2) if the valuation of the property increases over time that gain in equity % is yours (not the lenders). However note that the legal ownership is all 100% yours from the start. Are my parents ripping me off with this deal that doesn't allow me to build my equity in my home? You can evaluate whether you are being ripped off by comparing the $1350/mo rate to the potential rental rate for the property over time (which will be a range or curve, and there are real estate websites (like zillow.com or redfin.com, others) to help estimate what fair-market rent might be). Are there similar deals like this...? A straight-forward loan would have the borrower with 100% legal ownership from the start, just that the property secures the loan. Whereas with co-investment there is a division of ownership % that is fixed from the start. It is unusual to have both investment and loan at the same time where they are setup for gradual change between them. (Investment and loan can certainly be done together but would usually be done as completely separate contracts, one loan, one investment with no adjustment between the two over time.) To do both investment and loan would be unusual but certainly be possible, I would imagine; however that is not the case here as being described. I am not familiar with contracts that do both so as to take over the equity/ownership/investment over time while also reducing loan balance. Perhaps some forms of rent-to-own work that way, something to look into — still, usually rent-to-own means that until the renter owns it 100%, the landlord owns 100%, rather than a gradual % transfer over time (gradual transfer would imply co-ownership for a long time, something that most landlords would be reluctant to do). Transfer of any particular % of real estate ownership typically requires filing documents with the county and may incur fees. I am not aware of counties that allow gradual % transfer with one single filing. Still, the courts may honor a contract that does such gradual transfer outside of county filings. If so, what should I do? Explain the situation to your parents, and, in particular, however far out of balance the rental rate may be. Decide for yourself if you want to rent vs. buy, and where (that property or some other). If your parents are fair people, they should be open to negotiation. If not, you might need a lawyer. I suspect that a lawyer would be able to find several issues with which to challenge the contract. The other terms are important as well, namely gross vs. net proceeds (as others point out) because selling a property costs a % to real estate agents and possibly some taxes as well. And as the others have pointed out, if the property ultimately looses value, that could be factored in as well. It is immaterial to judging the fairness of this particular situation whether getting a bank loan would be preferable to renting 75% from the parents. Further, loan interest rates don't factor into the fairness of this rental situation (but of course interest rates do factor into identifying the better of various methods of investment and methods of securing a place to live, e.g. rent vs. buy). Contributed by @Scott: If your parents view this as an investment arrangement as described, then you need to clarify with them if the payments being made to them are considered a \"\"buy out\"\" of their share. This would allow you to gain the equity you seek from the arrangement. @Scott: Terms would have to be (or have been) declared to that effect; this would involve specifying some schedule and/or rates. It would have to be negotiated; this it is not something that could go assumed or unstated. -- Erik\"" }, { "docid": "220559", "title": "", "text": "Something like this sort of thing happened to me but with Chase bank. The county made a mistake on our taxes and forgot to give us the right deductions and we got a whopping high property tax bill. Since we did have an escrow account the bank just paid the taxes and raised our mortgage by a nearly unaffordable 60% or so even though we called the bank and told them not to pay the tax bill as it was being disputed. By the time we got the tax issues sorted out Chase refused to adjust the mortgage. The only way we were able to get out of it was to refinance with another bank and opt out of the escrow account and handle taxes on our own, which fixed the whole problem. It seemed an awful lot like an attempt to force us into a foreclosure. If we didn't have the money to refinance we would have barely been able to afford the mortgage payment. Why they would want to do that I have no idea. It really sucked though." }, { "docid": "256101", "title": "", "text": "I would talk to an immigration lawyer. This sounds like the kind of thing that they'd deal with frequently. As I understand it, your concern is mostly about managing the transfer, not the sale. An immigration lawyer is going to see clients with overseas assets frequently. If this isn't something that they do themselves, they can refer you appropriately. In general when I'm looking for a lawyer, I start with the local bar association. The one for San Francisco. If that's the wrong bay area, they are normally at the county level. So you can find them by searching for bar association with the appropriate county or city name. If you explain your problem briefly, they can direct you." }, { "docid": "394429", "title": "", "text": "Hmm didn't expect downvotes for stating that QNX is technically one of the best. It is used in Nuclear power stations, the shuttle robot arm , in Ciscos top of the line carrier grade router (CRS1 using IOS XR), amongst many other applications especially within infotainment in the automotive sector. http://www.qnx.com/ It's a great asset that they bought at a good price. I have worked in embedded computing for 20 years in the corporate world, I have specified and used pretty much any OS you care to name, this is a great one with its transparent IPC, high availability manager, user mode drivers, etc. Please don't connect QNX with what you see on the blackberry phones because it's not the same OS." }, { "docid": "319386", "title": "", "text": "Search official county bankruptcy records, bankruptcy discharge papers, bankruptcy creditors listing at lowest cost on web. You can search either of bankruptcy discharge papers, Creditor listing or complete bankruptcy file as per your needs. We have identified a resource to help consumer and business filer can search and find their county bankruptcy court records after getting discharged from bankruptcy court case (All 50 states)." }, { "docid": "94259", "title": "", "text": "Preparation &amp; processing an application for obtaining Code Number / sub -code number to the newly establishment &amp; Branch office in various part of states for extending the benefit of ESI Scheme to employees employed in that regions. We would process an online application to obtain TIC of newly joined employees within 10 days from the date of joining and data for the same shall be provided by you in time. We would be retrieving the Individual Insurance No.s &amp; maintain their contributions in the devised ESIC Register to be maintained. Monthly Payment Challans to be computed online and same shall be forwarded to you for payment on or before 21st of every month. To ensure payment before due date, data shall be provided in time. Preparation and compilation of Half Yearly Returns and Annual Returns would be our responsibility in cases where manual challan is prepared. All the Payments and Returns would be filed within the stipulated time and the adherence would be monitored by us. Guidelines to the Insured Persons (I.P.) pertaining to the Benefits under the ESIC Act, 1948 and provision of Information related to Insurance Medical Practitioner(Imp's) and Hospitals through ESIC. We would be liasoning on behalf of the establishment with the Regional Office &amp; Branch Office for ensuring smooth functioning. We would also be attending the periodical Inspections and hearings on behalf of the establishment. The Responsibility of the Assessment would be limited for the period which would be coverable under our service tenure. We will keep the Company posted on all Amendments &amp; Development of the Act." }, { "docid": "544732", "title": "", "text": "Is it cheaper to send in state tax now or wait until I file my return? Unless not paying now will trigger some sort of state tax penalty (which will depend on your situation and what state you live in), there's no practical difference between paying now and paying when you file. The only thing you lose by paying now will be the possible return you could earn by investing it, which is probably minimal. I would be more concerned about the penalties than any opportunity costs." } ]

[ { "docid": "306280", "title": "", "text": "\"There is a ten year statue of limitations on debt collection, bankruptcy, etc. The problem is, if you start paying, even say, $1, you \"\"acknowledge\"\" the debt and the clock starts again. Debt claims fall under the \"\"he said, she said,\"\" rubric. In debt restructuring situations, the debtor is taught to write all their creditors DENYING debts. Some percentage of those creditors won't have the paperwork to back up their claims. Others will, and can press their claims. Then a court decides. But in any event, a debt more than tens years old is a \"\"stale,\"\" debt. A court is likely to rule in your favor. Unless you \"\"acknowledge\"\" the debt.\"" } ]

[ { "docid": "474573", "title": "", "text": "\"@Joe's original answer and the example with proportionate application of the payment to the two balances is not quite what will happen with US credit cards. By US law (CARD Act of 2009), if you make only the minimum required payment (or less), the credit-card company can choose which part of the balance that sum is applied to. I am not aware of any company that chooses to apply such payments to anything other than that part of the balance which carries the least interest rate (including the 0% rate that \"\"results\"\" from acceptance of balance transfer offers). If you make more than the minimum required payment, then the excess must, by law, be applied to paying off the highest rate balance. If the highest rate balance gets paid off completely, any remaining amount must be applied to second-highest rate balance, and so on. Thus, it is not the case that that $600 payment (in Joe's example) is applied proportionately to the $5000 and $1000 balances owed. It depends on what the required minimum payment is. So, what would be the minimum required payment? The minimum payment is the total of (i) all finance charges incurred during that month, (ii) all service fees and penalties (e.g. fee for exceeding credit limit, fee for taking a cash advance, late payment penalty) and other charges (e.g. annual card fee) and (iii) a fraction of the outstanding balance that (by law) must be large enough to allow the customer to pay off the entire balance in a reasonable length of time. The law is silent on what is reasonable, but most companies use 1% (which would pay off the balance over 8.33 years). Consider the numbers in Joe's example together with the following assumptions: $5000 and $1000 are the balances owed at the beginning of the month, no new charges or service fees during that month, and the previous month's minimum monthly payment was made on the day that the statement paid so that the finance charge for the current month is on the balances stated). The finance charge on the $5000 balance is $56.25, while the finance charge on the $1000 balance is $18.33, giving a minimum required payment of $56.25+18.33+60 = $134.58. Of the $600 payment, $134.58 would be applied to the lower-rate balance ($5000 + $56.25 = $5056.25) and reduce it to $4921.67. The excess $465.42 would be applied to the high-rate balance of $1000+18.33 = $1018.33 and reduce it to $552.91. In general, it is a bad idea to take a cash advance from a credit card. Don't do it unless you absolutely must have cash then and there to buy something from a merchant who does not accept credit cards, only cash, and don't be tempted to use the \"\"convenience checks\"\" that credit-card companies send you from time to time. All such cash advances not only carry larger rates of interest (there may also be upfront fees for taking an advance) but any purchases made during the rest of the month also become subject to finance charge. In other words, there is no \"\"grace period\"\" for new charges, and this state of affairs will last for one month beyond the first credit-card statement whose statement is paid off in full in timely fashion. Finally, turning to the question asked, viz. \"\" I am trying to determine how much I need to pay monthly to zero the balance, ....\"\", as per the above calculations, if the OP makes the minimum required payment of $134.58 plus $1018.33, that $134.58 will be applied to the low-rate balance and the rest $1018.33 will pay off the high-rate balance in full if the payment is made on the day the statement is issued. If payment is made later, but before the due date, that $1018.33 will be accruing finance charges until the date the payment is made, and these will appear as 22% rate balance on next month's statement. Similarly for the low-rate balance. What if several monthly payments will be required? The best calculator known to me is at https://powerpay.org (free but it is necessary to set up a username and password). Enter in all the credit card balances and the different interest rates, and the total amount of money that can be used to pay off the balances, and the site will lay out a payment plan. (Basically, pay off the highest-interest rate balance as much as possible while making minimum required payments on the rest). Most people are surprised at how much can be saved (and how much shorter the time to be debt-free is) if one is willing to pay just a little bit more each month.\"" }, { "docid": "52250", "title": "", "text": "It sounds like your current loan is in your name. As such, you are responsible for paying it. Not your family, you. It also sounds like the loan payments are regularly late. That'll likely drastically affect your credit rating. Given what you've said, it doesn't surprise me that you were declined for a credit card. With the information on your credit report, you are a poor risk. Assuming your family is unable to pay loan on time (and assuming you aren't willing to do so), you desperately need to get your name off the loan. This may mean selling the property and closing out the loan. This won't be enough to fix your credit, though. All that will do is stop making your credit worse. It'll take a few years (five years in Canada, not sure how many years in India) until this loan stops showing up on your credit report. That's why it is important to do this immediately. Now, can a bank give you a loan or a credit card despite bad credit? Yes, absolutely. It all depends on how bad your credit is. If the bank is willing to do so, they'll most likely charge a higher interest rate. But the bank may well decide not to give you a loan. After all, your credit report shows you don't make your loan payments on time. You may also want to request your own copy of your credit report. You may have to pay for this, especially if you want to see your score. This could be valuable information if you are looking to fix your finances, and may be worth the cost. If you are sure it's just this one loan, it may not be necessary. Good luck! Edit: In India CIBIL is the authority that maintains records. Getting to know you exact score will help. CIBIL offers it via TransUnion. The non-payment will keep appearing on your record for 3 years. As you don't have any loans, get a credit card from a Bank where you have Fixed Deposits / PPF Account as it would be easier to get one. It can then help you build the credit." }, { "docid": "402325", "title": "", "text": "\"&gt; So I asked this question in /r/DebateaCommunist and got some interesting answers, mostly about how banks exist to make money out of nowhere and to fool people. What do yall have to say? That isn't what they said. Nobody mentioned fooling people from what I can see from a cursory glance. And if they did, they're being facetious. Also, they didn't mean \"\"make money from thin air\"\" in the sense of it being a magical trick. They make money from a sort of market inefficiency: they broker between people who want to invest money and those who want to borrow it. The top two answers are about right: a bank borrows money from investors (who deposit money in checking and savings accounts), and lends it to borrowers in the form of loans or mortgages. The difference between the interest rates is their profit. You deposit $1000 with me at 2% for 20 years. I give you $1485.95 at the end of that term. Where did I get the extra five hundred books? Well I lent it out in mortgages over the same terms at 6% and received $3207.14 over the same period of time. Your $1000 made you $485.95, and made me $1721.19 which I keep for the purposes of providing you with ATMs, dealing with bad debts and staffing the place. Simple, eh? Of course, they also provide other services in addition to this, and the way in which they do it is regulated, but that's all a bank is at its core. A central bank is slightly different: they issue money (i.e. \"\"print\"\" it), and supply it at a headline interest rate to the commercial banks. And of course banks borrow amongst themselves. But then we get ourselves down the rabbit hole of \"\"grown up\"\" economics and LIBOR and the like... there are whole textbooks used to explain exactly how that mechanism works and what's going on there. But if you want to get rich, find a way to start a bank. Seriously. Doing it to the old school way is seriously profitable if you can be trusted.\"" }, { "docid": "234890", "title": "", "text": "1 - For FHA loans PMI is required for mortages where there is not at least 20% equity. Bank Financed Non-FHA loans may have other standards. If you are getting an FHA loan ,if possible put down 20% so that you do not have to pay PMI. That said your PMI costs should be reduced by the size of your down payment since the PMI covers the difference between your equity value (Based on the appraisal at time of purchase) and 20% equity value of the home. So if you buy a home for 425k(assuming 100% appraisal price) 20% equity would be 85k. So if you put 10% down you would be paying PMI until you accrue an addition 42500 in equity. And you will be paying PMI on that for about 12 years(typical on 30 year mortgage) or until you refinance(having home appraised at higher value than purchase price where you would have 20% equity). There are ways to get out of PMI early but few banks are willing to help you through the hoops unless you refinance(and pay more closing costs). 2 - Different banks offer better rates or other benefits for paying points. We paid $300 for a 1.5% reduction in our interest rate (less than 1%) but it was called a point. We were offered a few other points (.25% for 2500 and an one time on demand interest rate adjustment for ~3k) but declined but they may make more sense on a 425k home than our more modest one. You can talk to a banker about this now, get preapproved(which helps with getting offers accepted sometimes), and find out more details about the mortgage they will offer you. This meeting should be free(I would say will but some bank would charge just to prove me wrong) and help answer your questions more authoritatively than anyone here can. 3 - The costs will come out of your down payment. So if you put down 42.5k down your costs will come out of that. So you will probably end up with 30~35k being applied towards your purchase price with the rest going for costs. You can tell the banker you want to put 10% towards the price and the banker will give you a down payment probably around 50k to cover costs etc. (My figures are hopefully intentionally high better to find out that it will cost less than my guesstimate than get your hopes up just to find out the costs are higher than expected.)" }, { "docid": "192602", "title": "", "text": "Paying the minimum balance on a loan can be DEVASTATING and is highly UN-RECOMMENDED. It is important you understand your loan and the terms associated with it. Loans are given for a period of time but if you pay the minimum it does NOT mean you will pay it all off by the end. When paying a loan money is applied to the interest first and any extra amount is then applied to the principle. Here's an example: If I have a $12 loan for 1 year. The interest is 100%. My minimum payment each month is $1. If I pay that minimum only I will be stuck paying $12 at the end of the loan. Why you ask? because each month I'm being charged $1 interest and the payment I am making is only going towards that interest. However if I paid $2 instead now $1 goes to the principal (the original $12 I borrowed). This means that next month I will only be charged interest on $11 dollars instead of $12. You need to know how much is going towards the interest of your loan and how much is going towards the principle you can speak with your bank about this and they will help you understand. In many cases they actually provide you with the numbers on your statment with examples of how long it would take to payoff your loan with minimum only and how long it would take if you added an extra x amount each month. I recommend using the Snowball Method to pay of your debt. It's simple and effective. How much you should add to each monthly payment depends on how much you can afford to add. Here are some calculators you can play around with: CNN Money Bank Rate Calc Edit: So with the additional information you provided we can estimate that you have about 2200 free cash flow each month(that's your cash after you pay all your bills). We can put away 500 each month for a rainy day fund, just to be safe.(job loss, accidents, or anything we can't predict) So assuming that is all your expenses including the money you spend on entertainment. That leaves you with $1700 you can add on to your loan payments. So you can pay off your third loan in 1 month. Then add the remaining balance to the 2nd loan. With this income it should take you less then a year to pay off all your loans." }, { "docid": "340484", "title": "", "text": "\"Allen, welcome to Money.SE. You've stumbled into the issue of Debt Snowball, which is the \"\"low balance\"\" method of paying off debt. The other being \"\"high interest.\"\" I absolutely agree that when one has a pile of cards, say a dozen, there is a psychological benefit to paying off the low balances and knocking off card after card. I am not dismissive of that motivation. Personal Finance has that first word, personal, and one size rarely fits all. For those who are numbers-oriented, it's worth doing the math, a simple spreadsheet showing the cost of the DS vs paying by rate. If that cost is even a couple hundred dollars, I'll still concede that one less payment, envelope, stamp, etc, favors the DS method. On the other hand, there's the debt so large that the best payoff is 2 or 3 years away. During that time, $10000 paid toward the 24% card is saving you $2400/yr vs the $500 if paid toward 5% debt. Hard core DSers don't even want to discuss the numbers, strangely enough. In your case, you don't have a pile of anything. The mortgage isn't even up for discussion. You have just 2 car loans. Send the $11,000 to the $19K loan carrying the 2.5%. This will save you $500 over the next 2 years vs paying the zero loan down. Once you've done that, the remaining $8000 will become your lowest balance, and you should flip to the Debt Snowball method, which will keep you paying that debt off. DS is a tool that should be pulled out for the masses, the radio audience that The David (Dave Ramsey, radio show host) appeals to. They may comprise the majority of those with high credit card debt, and have greatest success using this method. But, you exhibit none of their symptoms, and are best served by the math. By bringing up the topic here, you've found yourself in the same situation as the guy who happens to order a white wine at a wedding, and finds his Mormon cousin offering to take him to an AA meeting the next day. In past articles on this decision, I've referenced a spreadsheet one can download. It offers an easy way to see your choice without writing your own excel doc. For the situation described here, the low balance total interest is $546 vs $192 for the higher interest. Not quite the $500 difference I estimated. The $350 difference is low due to the small rate difference and relatively short payoffs. In my opinion, knowledge is power, and you can decide either way. What's important is that if you pay off the zero interest first, you can say \"\"I knew it was a $350 difference, but I'd rather have just one outstanding loan for the remain time.\"\" My issue with DS is when it's preached like a religion, and followers are told to not even run the numbers. I wrote an article, Thinking about Dave Ramsey a number of years back, but the topic never gets old.\"" }, { "docid": "464619", "title": "", "text": "\"I started a business a few years ago. At one point it wasn't going so well and my father \"\"loaned\"\" me an amount not too dissimilar to what you've done. From a personal perspective, the moment I took that loan there was a strain the relationship. Especially when I was sometimes late on the interest payments... Unfortunately thoughts like \"\"he doesn't need this right now, but if I don't pay the car loan then that is taken away\"\" came up a few times and paying the interest fell to the bottom of the monthly bill payment stack. At some point my wife and I finally took a hard look at my finances and goals. We got rid of things that simply weren't necessary (car payment, cable tv, etc) and focused on the things we needed to. Doing the same with the business helped out as well, as it helped focus me to to turn things around. Things are now going great. That said, two of my siblings ran into their own financial trouble that our parents helped them on. When this happened my father called us together and basically forgave everyone's debt by an equal amount which covered everything plus wrote a check to the one that was doing fine. This \"\"cleared the air\"\" with regards to future inheritance, questions about how much one sibling was being helped vs another, etc. Honestly, it made family gatherings more enjoyable as all that underlying tension was now gone. I've since helped one of my children. Although I went about it an entirely different way. Rather than loan them money, I gave it to them. We also had a few discussions on how I think they ought to manage their finances and a set of goals to work towards which we co-developed. Bearing in mind that they are an individual and sometimes you can lead a horse... Given the current state of things I consider it money well \"\"spent\"\".\"" }, { "docid": "451457", "title": "", "text": "\"A major thing to consider when deciding whether to invest or pay off debt is cash flow. Specifically, how each choice affects your cash flow, and how your cash flow is affected by various events. Simply enough, your cash flow is the amount of money that passes through your finances during a given period (often a month or a year). Some of this is necessary payments, like staying current on loans, rent, etc., while other parts are not necessary, such as eating out. For example, you currently have $5,500 debt at 3% and another $2,500 at 5%. This means that every month, your cashflow effect of these loans is ($5,500 * 3% / 12) + ($2,500 * 5% / 12) = $24 interest (before any applicable tax effects), plus any required payments toward the principal which you don't state. To have the $8,000 paid off in 30 years, you'd be paying another $33 toward the principal, for a total of about $60 per month before tax effects in your case. If you take the full $7,000 you have available and use it to pay off the debt starting with the higher-interest loan, then your situation changes such that you now: Assuming that the repayment timeline remains the same, the cashflow effect of the above becomes $1,000 * 3% / 12 = $2.50/month interest plus $2.78/month toward the principal, again before tax effects. In one fell swoop, you just reduced your monthly payment from $60 to $5.25. Per year, this means $720 to $63, so on the $7,000 \"\"invested\"\" in repayment you get $657 in return every year for a 9.4% annual return on investment. It will take you about 11 years to use only this money to save another $7,000, as opposed to the 30 years original repayment schedule. If the extra payment goes toward knocking time off the existing repayment schedule but keeping the amount paid toward the principal per month the same, you are now paying $33 toward the principal plus $2.50 interest against the $1,000 loan, which means by paying $35.50/month you will be debt free in 30 months: two and a half years, instead of 30 years, an effective 92% reduction in repayment time. You immediately have another about $25/month in your budget, and in two and a half years you will have $60 per month that you wouldn't have if you stuck with the original repayment schedule. If instead the total amount paid remains the same, you are then paying about $57.50/month toward the principal and will be debt free in less than a year and a half. Not too shabby, if you ask me. Also, don't forget that this is a known, guaranteed return in that you know what you would be paying in interest if you didn't do this, and you know what you will be paying in interest if you do this. Even if the interest rate is variable, you can calculate this to a reasonable degree of certainty. The difference between those two is your return on investment. Compare this to the fact that while an investment in the S&P might have similar returns over long periods of time, the stock market is much more volatile in the shorter term (as the past two decades have so eloquently demonstrated). It doesn't do you much good if an investment returns 10% per year over 30 years, if when you need the money it's down 30% because you bought at a local peak and have held the investment for only a year. Also consider if you go back to school, are you going to feel better about a $5.25/month payment or a $60/month payment? (Even if the payments on old debt are deferred while you are studying, you will still have to pay the money, and it will likely be accruing interest in the meantime.) Now, I really don't advocate emptying your savings account entirely the way I did in the example above. Stuff happens all the time, and some stuff that happens costs money. Instead, you should be keeping some of that money easily available in a liquid, non-volatile form (which basically means a savings account without withdrawal penalties or a money market fund, not the stock market). How much depends on your necessary expenses; a buffer of three months' worth of expenses is an often recommended starting point for an emergency fund. The above should however help you evaluate how much to keep, how much to invest and how much to use to pay off loans early, respectively.\"" }, { "docid": "350980", "title": "", "text": "If it were me, I'd be debt free today, Monday, at latest. 100K-(53K+31.2K) = 15.8K would be my bank balance by this afternoon. I am not sure why you would count 6K of your daughter's money as yours to use. Either it is her money, or yours, not both. If you still want debt, which I think is silly, you might try to refi your home with a home equity loan. That loan would be in first position, at a fixed rate, and for a fixed term. Regions bank did some thing like this for a person with excellent credit and plenty of equity. They got a 7 year loan at 2.6% when the prevailing interest rate on a 15 year was about a point higher." }, { "docid": "10180", "title": "", "text": "\"Depending on how you view the loan, it could either be considered an Asset or a Liability. Since you are not charging interest, it might seem more intuitive to create an \"\"Assets:Cash Loan\"\" account, and transfer money to & from it (when you receive payments) like you would with a bank account. Personally, I prefer to think of all loans as liabilities. Whether it's a debt which you owe someone, or a balance which someone else owes you, since it's an 'unsettled' amount I file it under \"\"Liabilities:Loan\"\". Either way, you record the initial balance as a debit from your bank, and then record payments as credits back to your primary account. The only way that income or expenses ever gets involved would be if you charged interest (income) or if you forgave some or all of the loan (expense) at some point in the future.\"" }, { "docid": "231280", "title": "", "text": "\"The short answer to all of this is that it depends on the loan and on the collections agency. It's an \"\"interesting\"\" time to be a collections agency right now. On the one hand, people are defaulting on debts, and those creditors want to be paid and are beating down the agencies' doors. On the other hand, if you can't pay you can't pay, and the threat of collections action is not much of a motivation when you're already 90 days out, and so collections agencies are having to consult crystal balls and tea leaves to try to determine which debts they're likely to collect if they buy. Many collections agencies have begun subscribing to the \"\"you catch more flies with honey than vinegar\"\" philosophy; \"\"we know it may be very difficult for you right now, so we'll make you a deal to settle the debt for 80% of face value, and you'll never hear from us again\"\". Other agencies continue to live by the threat model; \"\"we're heartless and cruel and we don't care that it's tough; we own you and you will pay us everything we ask for or we will make your life hell every way we can\"\". There are advantages, and a certain synergy, to both approaches. You really do get more success by making a deal, so the agency that is willing to work with the debtor and offer them a good deal is going to be more likely to collect. However, that quickly becomes an incentive to not pay; \"\"Yeah, they sent me this outrageous bill for my sprained ankle, so I just ignored it and let 'em sweat, and ended up paying half what they billed me\"\". Sprinkle in just a few cases of \"\"Yeah, I couldn't pay my cell phone bill so I just let them cut it off, but the collections agency started calling and mailing me every day and I had to pay twice what I owed in the first place to make it stop\"\", which filters through the collective psyche of the masses, and all of a sudden if and when they do offer a deal on a debt you fell behind on, you jump on it. Now, to the question at the end of your post. It's always better for your credit to pay than to not pay. An open collections account on your credit score will always be a bigger ding than a closed one. But, open or closed, that collections activity remains part of your history unless the collections agency agrees to retract it. Even then, you may have to go around to the big three credit bureaus and get the account removed, using documentation which the agency must provide stating something to the effect of \"\"we agree that this never happened\"\". If the agency refuses to remove this black mark, how black it will be depends on the terms by which the account was settled. The reporting agencies will be told the face value of the debt that was sent to collections, and they will be told the amount paid to settle it. If the debt was settled for face value, that tells people reading your report that, well, you were very late and only paid under duress, but at least you did make good on the debt in full. If you settle for less than the face value, that says something different entirely; not only could you not pay the original creditor, you had to negotiate to reduce the amount to pay the debt collector. That makes extending you credit very risky; not only are you a proven risk for being late to pay, not only are you a proven risk for them having to write off the debt, but if and when they sell it to a collections agency, the agency will see that a past debt was settled for less than face value and assume they'll get the same treatment, and so will offer less to buy the debt. Both of those cases are still better than an open collection; that says to someone considering loaning you money that not only will you default, not only will they have to write it off, not only will the collections agency make less profit... the collections agency is unlikely to see ANYTHING from this bad debt and may not even agree to buy it.\"" }, { "docid": "462036", "title": "", "text": "\"This may be a bit advanced now, but once you start really working and get a place, I think this will apply more... Do I set up a bank account now? Yes. There is no reason not to. As an adult you will be using this much more than you think. Assuming you have a little money, you can walk in to any bank almost any day of the week and set up an account with them in very little time. Note that they may require you to be 18 if your parents won't be with you on the account. Otherwise, just ask any bank representative to help you do this. Just to be clear, if you can get a credit union account over a typical bank account, this is a great idea. Credit unions provide exactly the same financial services as a normal bank, but typically have variety of advantages over banks. Bank Account Parts Bank accounts typically have two parts, a checking account and a savings account. Your checking account typically is what you use for most day-to-day transactions and your savings account is generally used for, well, saving money. Having a bank account often gives you the following advantages: They give you an ability to store money without having large amounts of cash on hand. Once you start working regularly, you'll find you won't want to keep ~$600+ cash every two weeks in your wallet or apartment. They help you pay bills. When you set up your bank account, you will likely be able to get a Visa debit card which will process like a regular credit card but simply deduct funds from your checking account. You can use this card online to pay utilities (i.e. electricity and water), general bills (e.g. your cell phone and cable), purchase items (ex. at Amazon) or use it in stores to pay in lieu of cash. Be aware -- some banks will give you an ATM-only card before they send you the Visa debit card in the mail. This ATM-only card can only be used at ATMs as it's name implies. Similarly, if you can invest about ~$200 to build your credit, you can often get a deposit secured credit card attached to your account (basically a credit card where the bank keeps your money in case you can't pay your bill). If you treat this card with responsibility, you can eventually transition to an unsecured credit card. They save you hassles when cashing your check. If you don't have a bank where you can cash your check (e.g. you don't have an account), you will likely be charged check cashing fees (usually by places such as grocery stores or payday loan chains, or even other banks). Furthermore, if your check is over a certain amount, some places may refuse to cash your check period and a bank may be your only option. They give you a way to receive money electronically. The most common example of this is direct deposit. Many employers will send your money directly to your bank account instead of requiring you to cash a check. If they are prompt, this money gets to you faster and saves you trouble (on payday, you'll just receive a pay stub detailing your wages and the amount deposited rather than a check). Also, since you asked about taxes, you should know that when you do eventually file with the IRS, they have an option to receive your tax refund electronically as well (e.g. direct deposit into your bank account) and that can literally save you months in some cases depending on when you file your return and how many paper checks they have to process. Does it cost money to setup? It depends. Some banks have special offers, some don't. Most places will set up an account for free, but may require a minimum deposit to open the account (typically $50-$100). The Visa debit card mentioned above generally comes free. If you want a secured credit card as above, you will want about an additional $200 (so $250 - $300 total). Note that this is absolutely NOT required. You can exclusively use the Visa debit card above if you wish. Bank Account Fees Any fees charged when you have a bank account are usually minor anymore. Regardless, the bank will hand you a whole bunch of paperwork (mostly in legalese) detailing exactly how your account works. That said, the bank person helping set things up will cover what you need to know about keeping the account in plain English. The most common types of fee associated with a bank account are monthly maintenance fees and overdraft fees, but these aren't always necessarily charged. Likewise, there may be some other fees associated with the account but these vary from bank to bank. Monthly Maintenance Fees To give some examples... Overdraft Fees Overdraft fees are typically charged when you attempt to spend more money than you have in your bank account and the bank has to cover these charges. Overdraft fees typically apply to using paper checks (which it is unlikely you will be using), but not always. That said, it is very unlikely you will be charged overdraft fees for three reasons: Many banks have done away with these fees in lieu of other ways of generating revenue. Banks that still charge these fees usually have \"\"overdraft protection\"\" options for a little more money a month, effectively negating the possibility you will be charged these fees. The ability to deduct an amount of money from your checking account is now typically checked electronically before the payment is authorized. That is, using a Visa debit card, the card balance is checked immediately, and even when using paper check, most retailers have check scanning machines that do roughly the same thing. On a personal note, the bank that I have allows my account to be deducted below my checking account balance only if the payment is requested electronically (e.g. someone who has my card information charges me for a monthly service). In this case, the funds are simply listed in the negative and deducted from any amount I deposit till the proper amount is repaid (e.g. if I'm at -$25 dollars due to a charge when my account balance was $0 and then I deposit $100, my available balance will then be $75, not $100). Finally, per the comment by @Thebluefish, while I minimize the likelihood you will be charged overdraft fees, it is good to check into the exact circumstances under which you might be charged unexpectedly by your bank. Read the documentation they give you carefully, including any mailed updates, and you'll reduce the chance of receiving a nasty surprise. For reference, here are some of the fees charged by Bank of America. What about taxes? When you begin working, an employer will usually have you fill out a tax form such as a W-4 Employee's Withholding Allowance Certificate so that your employer can withhold the correct federal income tax from your wages. If they don't, then it is your responsibility to calculate and file your own income taxes (if you are self-employed, an independent contractor or paid under the table). If your employer is reputable, they will send you additional information (generally in February) you need to properly file your taxes prior to April 15th (the IRS tax deadline for most people). This additional information will likely be some variation of a W-2 Wage and Tax Statement or possibly a Form 1099-MISC. Do I have to worry about money in my bank account? Unless you have a significant amount in your bank savings account earning interest (see \"\"Should I save for the future?\"\" below), you won't have to pay any sort of tax on money in your bank account. If you do earn enough taxable interest, the bank will send you the proper forms to file your taxes. How do I file taxes? While it won't apply till next year, you will likely be able to fill out a Form 1040EZ Income Tax Return for Single and Joint Filers With No Dependents, as long as you don't have any kids in the meantime. ;-) You will either mail in the paper form (available at your local IRS office, post office, public library, etc.) or file electronically. There will be a lot of information on how to do this when the time comes, so don't worry about details just yet. Assuming your all paid up on your taxes (very likely unless you get a good paying job and take a lot of deductions throughout the year on your W-4), you'll probably get money back from the IRS when you file your tax return. As I mentioned above, if you have a bank account, you can opt to have your refund money returned electronically and get it much sooner than if you didn't have a bank account (again, possibly saving you literal months of waiting). Should I save for my future? If so, how much? Any good articles? Yes, you should save for the future, and start as soon as possible. It's outside the scope of this answer, but listen to your Economics professor talk about compound interest. In short, the later you start saving, the less money you have when you retire. Not that it makes much difference now, but you have to think that over 45 years of working (age 20-65), you likely have to have enough money for another 20+ years of not working (65-85+). So if you want $25,000 a year for retirement, you need to make ~$50,000 - $75,000 a year between your job and any financial instruments you have (savings account, stocks, bonds, CDs, mutual funds, IRAs, job retirement benefits, etc.) Where you should stick money your money is a complicated question which you can investigate at length as you get older. Personally, though, I would recommend some combination of IRA (Individual Retirement Account), long term mutual funds, and some sort of savings bonds. There is a metric ton of information regarding financial planning, but you can always read something like Investing For Dummies or you can try the Motley Fool's How To Invest (online and highly recommended). But I'm Only 17... So what should you do now? Budget. Sounds dumb, but just look at your basic expenses and total them all up (rent, utilities, phone, cable, food, gas, other costs) and divide by two. Out of each paycheck, this is how much money you need to save not to go into debt. Try to save a little each month. $50 - $100 a month is a good starting amount if you can swing it. You can always try to save more later. Invest early. You may not get great returns, but you don't need much money to start investing. Often you can get started with as little as $20 - $100. You'll have to do research but it is possible. Put money in your savings account. Checking accounts do not typically earn interest but money in savings accounts often do (that is, the bank will actually add money to your savings assuming you leave it in there long enough). Unfortunately, this rate of interest is only about 3.5% on average, which for most people means they don't get rich off it. You have to have a significant amount of money ($5,000+) to see even modest improvements in your savings account balance each month. But still, you may eventually get there. Get into the habit of putting money places that make you money in the long run. Don't go into debt. Don't get payday loans, pawn items, or abuse credit cards. Besides wrecking your credit, even a small amount of debt ($500+) can be very hard to break out of if you don't have a great paying job and can even make you homeless (no rent means no apartment). Remember, be financially responsible -- but assuming your parents aren't totally tight with money, don't be afraid to ask for cash when you really need it. This is a much better option than borrowing from some place that charges outrageous interest or making your payments late. Have an emergency account. As already mentioned in another excellent answer, you need to have money to \"\"smooth things out\"\" when you encounter unexpected events (your employer has trouble with your check, you have to pay for some sort of repair bill, you use more gas in your car in a month than normal, etc.) Anywhere from $200 - $2000+ should do it, but ideally you should have at least enough to cover a month of basic expenses. Build good credit. Avoid the temptation to get a lot of credit cards, even if stores and banks are dying to give them to you. You really only need one to build good credit (preferably a secured one from your bank, as mentioned above). Never charge more than you can pay off in a single month. Charging, then paying that amount off before the due date on your next statement, will help your credit immensely. Likewise, pay attention to your rent, utilities and monthly services (cell phone, cable, etc.). Even though these seem like options you can put off (\"\"Oh my electric bill is only $40? I'll pay that next month...\"\") late payments on all of these can negatively affect your credit score, which you will need later to get good loans and buy a house. Get health insurance. Now that the Affordable Care Act (ACA a.k.a Obamacare) has been enacted, it is now simpler to get health insurance, and it is actually required you have some. Hopefully, your employer will offer health coverage, you can find reasonably priced coverage on your own, or you live in a state with a health exchange. Even if you can't otherwise get/afford insurance, you may qualify for some sort of state coverage depending on income. If you don't have some sort of health insurance (private or otherwise), the IRS can potentially fine you when you file your taxes. Not to be too scary, but the fine as currently proposed is jumping up to about $700 for individuals in 2016 or so. So... even if you don't grab health insurance (which you absolutely should), you need to save about $60 a month, even if just for the fine. This answer turned out a bit longer than intended, but hopefully it will help you a little bit. Welcome to the wonderful world of adult financial responsibility. :-)\"" }, { "docid": "544840", "title": "", "text": "Obama never helped with the debt overhand on households as he promised. All the overleveraged household debt due to homes with first and/or second mortgages that exceeded the value of the home was more or less unrelieved by his HAARP program, and other programs that were supposed to relieve overleveraged households. So the debt overhand was never addressed and is still being worked through as millions of homeowners pay down mortgages. It's going to continue for a few more years, until people start building up equity again. This all affects the economy, as consumers have less money to buy things with or maintain solvency, as trillions are still being funnelled to finance companies and investors in real estate derivatives. For example, a large part of the student loan bubble is due to this debt, since many homeowners who would have, in the past, taken out tax deductible equity loans to finance their kids's education, can no longer do so. Instead, a portion of student debt is being carried by the kids themselves, whoo graduate under debt and can't buy their own homes or spend their paychecks, for years or decades. There has been widespread non-compliance among banks with Obama's HAARP program and other measures intended to provide homeowners from the housing bubble debt overhang, but the Administration never followed through or engaged in enforcement actions that encouraged compliance. Those programs were therefore ineffective and/or were always intended just to be window-dressing, or faux achievements. The banks are still raking in trillions of undue profits from overpriced mortgages created during the housing bubble their practices helped create. Those trillions are coming out of the rest of the economy, where the dollars would be better spent." }, { "docid": "533589", "title": "", "text": "Suppose you have been paying interest on previous charges in the past. Your monthly statement is issued on April 12, and (since you just received your income tax refund), you pay it off in full on April 30. You don't charge anything to the card at all after April 12. Thus, on April 30, your credit card balance shows as zero since you just paid it off. But your April 12 statement billed you for interest only till April 12. So, on May 12, your next monthly bill will be for the interest for your nonzero balance from April 13 through April 30. Assuming that you still are not making any new charges on your card and pay off the May 12 bill in timely fashion, you will finally have a zero bill on June 12. What if you charge new items to your credit card after April 12? Well, your balance stopped revolving on April 30, and that's when interest is no longer charged on the new charges. But you do owe interest for a charge on April 13 (say) until April 30 when your balance is no longer revolving, and this will be added to your bill on May 12. Purchases made after April 30 will not be charged interest unless you fall off the wagon again and don't pay your May 12 bill in full by the due date of the bill (some time in early June)." }, { "docid": "327441", "title": "", "text": "\"Bankruptcy should be your last option, and you will find that BK will not resolve most of your problems, and create many more problems. There are two kinds of BK that are available to the average person, Ch13 debt repayment and Ch7 liquidation. Both have severe repercussions and lasting effects on your credit (7-10 years, after discharge). And the calculations required under the 2005 BAPCPA are complex and may require help to understand. Ch7 liquidation is the more severe course, and the trustee would liquidate assets that exceed exemptions (vary by state) to pay your creditors. Ch13 debt repayment is hard, and only 20-25% of those who pursue that route complete the debt repayment plan. Your credit score for either course would suffer greatly (200-250 points) and would remain reduced for years, especially since you would have to rebuild credit. And the law is flawed both in design and execution as there is no reward for successful debt repayment, few finish their repayment plan (20-25%), the mean recovery for unsecured creditors in repayment is zero (thus does not help creditors), and leaves the debtor with damaged credit for years (not a fresh start). Although you may have made some decisions that have placed you in a difficult position, you can find solutions to resolve these problems. You may find that simply learning to make better choices will improve your situation. Take a financial education course (such as the Dave Ramsey course), and learn how to budget, and make better choices. The LearnVest website offers a simple way to budget by dividing budgeting into only three (3) categories with suggested percentages for each, essentials (<50%), financial priorities (>20%), and lifestyle (<30%). The damage to your credit from the derogatory effects of BK would linger for years, but the damage from poor payment history declines much quicker, and loses most of the effect after 2 years (and should you keep the accounts open, leaves you with good history and longer account history), thus the effects decline to minimal after as little as 2 years of good behavior/payment history. Make a plan that prioritizes the debts, and how you will resolve the problem, and work the plan. Based upon the income and debts you mention, the situation you have may not be as bad as it appears. You may be getting bad advice, especially from a debt settlement company that might be more interested in their fees than in your problem. Since you \"\"want to play fair and continue with payments, but when people start to get greedy like this I am ready to just stop caring\"\", you really need two things, a plan, and a friend, someone who you can talk to honestly and openly, and who can support you as you work through the plan you make. Since you \"\"would prefer the option that will give me the most peace of mind and allow me to start saving money as soon as possible\"\", you need to find an approach that fits your goals. Your statement that you \"\"don't plan on ever using credit again\"\", fits with the Dave Ramsey philosophy and resonates with many of us who have learned that those who grant credit are often harsh masters. Now that you have provided more information, the advice below expands upon the above reflecting upon your specific situation. Since you make $62K/year, you may be close to the median income, and the BAPCPA (Bankruptcy Abuse Prevention and Consumer Protection Act of 2005) has a presumption of abuse for filing Ch7 when you have above median income (for your state, check the law). As you may be pushed into Ch13 debt repayment anyway, examine what you could do to repay the debt (over 5 years, 60 months, as that would be a Ch13 repayment duration). Since you have $8K of revolving (unsecured?) debt, that would be repaid in Ch13 over 60 months at about $133/month (no interest), but you would also be paying 10% to the trustee. There might be some portion of your auto debt which is unsecured, and also be repaid unsecured, suppose that is $3000. That would add another $50/month to the plan. The car could be repaid over 60 months (including interest), so you might be repaying $300/month for the car (estimate), although the payment could be higher or lower depending upon how much of the value of the car is unsecured. The trustee might object that the car is too expensive (depends upon the value, and the trustee), and require be liquidated. Since BK excludes relief for student loans, you might find yourself paying the student loans at the same payment. Your $62K income suggests that you have about $4200/month (guess, after taxes). The mortgage payment is higher than 25% ($1050-1100 would be ideal for your income). But after your mortgage payment you should still have about $3900. Even with $300 for credit card debt, $500 for car, and $400 for student loans (guessing), that leaves $2700 for essentials (utilities, food), lifestyle (cellphone, entertainment), and savings. You might find a friend who is good at budgeting who would be willing to help you craft a budget and be your \"\"responsibility partner\"\" to help you stick to the budget. Here is a sample plan (your mileage may vary), Essentials (50%, $2100): $2180 Financial (30%, 1230): $1250 Lifestyle (20%, 840): $500 (pick up slack here, as you have high debt load)\"" }, { "docid": "485119", "title": "", "text": "If you think you can manage the risk and the spread is ultimately worth it to you, there's nothing stopping you. I know in the U.S., in CA specifically, you need to have $85,000 annual income or net worth over some threshold to be able to loan more than $2,500 via peer-to-peer loan investing. I've had an account at prosper since around 2010, it does pretty well. It's made my taxes a bit more complicated each year, but it's been profitable for me. I wouldn't lever up on it though. My Prosper Experience My experience with Prosper has generally been positive. My real motivation for starting the account was generating a dataset that I could analyze, here's some of that analysis. I started the account by trickling $100 /month in to buy four $25 loans. Any payments received from these loans were used to buy more $25 loans. I've kept my risk to an average of about A- (AA, A, B, C, D, E, HR are the grades); though the interest rates have reduced over time. At this point, I have a few hundred loans outstanding in various stages of completion. In calendar 2015 I had a monthly average of 0.75% of my loans charged-off and about 3% of loans at some stage of delinquency. I receive about 5.5% of my principle value in receipts on average each month, including loan pay-offs and charge-offs. Interest and other non-principle payments comprise just shy of 20% of my monthly receipts. Prosper's 1% maintenance fee translates to about 8% of my monthly non-principle receipts. It's all a pretty fine line, it wouldn't take many defaults to turn my annual return negative; though in 5 years it hasn't happened yet. Considering only monthly charge-offs against monthly non-principle receipts I had two net negative months in 2015. I made about a net 4.5% annual return on my average monthly outstanding principle for calendar 2015. When I log in to my Prosper account it claims my return is closer to 7.5% (I'm not sure how that number is calculated). The key is diversifying your risk just like a bank would. I don't know how the other services function at a nuts and bolts level. With prosper I choose which loans to fund which means I determine my risk level. I assume the other services function similarly. Regarding collection of charged-off loans. I don't know how much real effort is expended by Prosper. I've had a few notes sold for about 10% of the outstanding balance; and I don't know who they were sold to. Comically, I have loan that's made more payments in collections than when it was in good standing. There is definitely more to this than handing over $15,000 and receiving 6% on it." }, { "docid": "197796", "title": "", "text": "Ditto to Victor. The simple rule is: Pay the minimums on all so you don't get any late fees, etc, then pay off the highest interest rate loan first. A couple of special cases do come to mind: If one or more of these are credit cards, then, here in the U.S. at least, credit cards charge you interest on the average daily balance, unless you pay off the balance entirely, in which case you pay zero interest. So for example say you had two credit cards, both with 1% per month interest, with debt of $2000 and $1000. You have $1500 available. Ignoring minimum payments for the moment, if you put that $1500 against the larger balance, you would still pay interest on the full amount for the current month, or $30. But if you paid off the smaller and put the difference against the larger, then your interest for the current month would be only $15. (Either way, your interest for NEXT month would be the same -- 1% of the $1500 remaining balance or $15 -- assuming you couldn't pay off the other card.) If one or more of the loans are mortgage loans on which you are paying mortgage insurance, then when you get the balance below a certain point -- usually 80% of the original loan amount -- you no longer have to pay mortgage insurance premiums. Thus the amount you are paying on such premiums needs to be factored into the calculation. There may be other special cases. Those are the ones that I've run into." }, { "docid": "365293", "title": "", "text": "Firstly, thank you for taking the time to respond, let me see what I can answer to help give you a bigger picture. * I am the rental manager but like I say, it's a small unit where the operations team is only 5 strong. We all have a hand in everything really and it was my precedent for implementing procedures in the past that triggered them to ask me into looking into this. * Honestly, I don't think I have much of a budget. That being said, if there's a price to anything and I can justify the company spending the money, they will be fair. From a personal perspective, I never even considered that third party software would be required for this kind of thing. If there's any you could recommend (licensed or open sourced) that would be greatly appreciated. * From what I can tell, the people in charge want a process in which we can fully understand CSAT from both a service and product standpoint. We can use the information gathered from our service feedback to improve ourselves and we can use the information gathered about the vehicles we lease (the products) so we can market them correctly in the future. Seeing how the customer feels on the vehicle's fuel economy, performance, comfort on the driver, downtime, etc. which can lead us to marketing the vehicles better or influence what vehicles we purchase moving on. * For the most part, I think the working processes are going to remain the same, where the customer support manager will have a more active role in getting these calls/visits/emails out to the customers and react accordingly. Again, thank you so much for your help." }, { "docid": "346387", "title": "", "text": "There are several things being mixed up in the questions being asked. The expense ratio charged by the mutual fund is built into the NAV per share of the fund, and you do not see the charge explicitly mentioned as a deduction on your 401k statement (or in the statement received from the mutual fund in a non-401k situation). The expense ratio is listed in the fund's prospectus, and should also have been made available to you in the literature about the new 401k plan that your employer is setting up. Mutual fund fees (for things like having a small balance, or for that matter, sales charges if any of the funds in the 401k are load funds, God forbid) are different. Some load mutual funds waive the sales charge load for 401k participants, while some may not. Actually, it all depends on how hard the employer negotiates with the 401k administration company who handles all the paperwork and the mutual fund company with which the 401k administration company negotiates. (In the 1980s, Fidelity Magellan (3% sales load) was a hot fund, but my employer managed to get it as an option in our plan with no sales load: it helped that my employer was large and could twist arms more easily than a mom-and-pop outfit or Solo 401k plan could). A long long time ago in a galaxy far far away, my first ever IRA contribution of $2000 into a no-load mutual fund resulted in a $25 annual maintenance fee, but the law allowed the payment of this fee separately from the $2000 if the IRA owner wished to do so. (If not, the $25 would reduce the IRA balance (and no, this did not count as a premature distribution from the IRA). Plan expenses are what the 401k administration company charges the employer for running the plan (and these expenses are not necessarily peanuts; a 401k plan is not something that needs just a spreadsheet -- there is lots of other paperwork that the employee never gets to see). In some cases, the employer pays the entire expense as a cost of doing business; in other cases, part is paid by the employer and the rest is passed on to the employees. As far as I know, there is no mechanism for the employee to pay these expenses outside the 401k plan (that is, these expenses are (visibly) deducted from the 401k plan balance). Finally, with regard to the question asked: how are plan fees divided among the investment options? I don't believe that anyone other than the 401k plan administrator or the employer can answer this. Even if the employer simply adopts one of the pre-packaged plans offered by a big 401k administrator (many brokerages and mutual fund companies offer these), the exact numbers depend on which pre-packaged plan has been chosen. (I do think the answers the OP has received are rubbish)." } ]

[ { "docid": "525967", "title": "", "text": "Investigate the statute of limitations in your area. 15 years sounds like in most places it is past the allowable time a debt collector can legally collect or report it on your credit report. The statute of limitations means you still owe the debt, but they collector can no longer use the court system to collect it from you. They can file a lawsuit, they will just lose. Please read up on how to handle yourself with a debt that is past the SoL, so that you don't accidentally reset the clock. What I don't know for sure is how that applies to a business, and I cannot remember ever hearing a difference between personal vs business debt, but it is best to consult a lawyer regarding it. References:" } ]

[ { "docid": "65043", "title": "", "text": "I'm sorry, I know that it's not your fault but you really need to think about what you're saying and stop listening to the financial advisors on tv... If you think that all you need to do is give people money to spend then you need to read up on Zimbabwe. They tried that - at it's hight they *think* that Zim's inflation hit 6.5 x 10^108 % ([that's 6.5 quindecillion novemdecillion percent](http://en.wikipedia.org/wiki/Hyperinflation_in_Zimbabwe)). I can't even begin to imagine how large that is - basically bread cost billions of zim dollars a loaf. I remember hearing the one day that they were dropping 3 zeros from their notes. I'm ashamed to say that I laughed. No one is buying right now because, instead of buying stuff, everyone is paying back loans - or they're too scared to buy in case they need the cash to survive in the future. Look at the liquidity crisis; the housing bubble; all the bank failing/needing to be bailed out lately - all because people couldn't pay back the loans they took out. The US government is already $15 trillion in debt (nearly 16 trillion now) - and that's only the public debt. The gov is already paying $454 billion every year *just to repay the **interest** on the debt!* Never mind actually paying back the principle amount. Last year it added another $1.2 trillion to the deficit (that's another 1,200,000,000 dollars that it owes on top of the 15,000,000,000 dollars it already owes). At the beginning of this year, public debt amounted to 102% of GDP - that means that if everyone in America didn't buy what ever it was that they bought last year and instead repaid the public debt (not private mind you, just the debts that the government owed) then they *still* wouldn't have been able to pay it all off. Now after reading all of that, please keep a straight face and tell me that all that the government needs to spend even more money to sort it all out." }, { "docid": "197796", "title": "", "text": "Ditto to Victor. The simple rule is: Pay the minimums on all so you don't get any late fees, etc, then pay off the highest interest rate loan first. A couple of special cases do come to mind: If one or more of these are credit cards, then, here in the U.S. at least, credit cards charge you interest on the average daily balance, unless you pay off the balance entirely, in which case you pay zero interest. So for example say you had two credit cards, both with 1% per month interest, with debt of $2000 and $1000. You have $1500 available. Ignoring minimum payments for the moment, if you put that $1500 against the larger balance, you would still pay interest on the full amount for the current month, or $30. But if you paid off the smaller and put the difference against the larger, then your interest for the current month would be only $15. (Either way, your interest for NEXT month would be the same -- 1% of the $1500 remaining balance or $15 -- assuming you couldn't pay off the other card.) If one or more of the loans are mortgage loans on which you are paying mortgage insurance, then when you get the balance below a certain point -- usually 80% of the original loan amount -- you no longer have to pay mortgage insurance premiums. Thus the amount you are paying on such premiums needs to be factored into the calculation. There may be other special cases. Those are the ones that I've run into." }, { "docid": "570921", "title": "", "text": "\"I added the tag 'budget' to your question. A detailed budget is the ideal tool for someone in your situation. And the details you offer indicate to me that's exactly what you've done. This first step is out of the way. Our (US) Vice President has a saying \"\"Don’t tell me what you value. Show me your budget and I will tell you what you value.\"\" In this light, I suggest you consider each and every item in your budget. With $87 left this past month, consider how cutting back a bit and finding a way to not spend another $45, less than 1% of that budget, will increase that savings over 50%. Every item can be lowered. If you took a cab, why not take public transportation. For cabs, can you car-pool, and join up with coworkers to share the ride? Can you downsize the apartment or get a bigger one but with a roommate? I've seen people do this. They go from a tiny one bedroom to a larger 2 bedroom that costs 50% more, but they are just paying half the rent. They also save on utilities, internet, etc. When I analyzed my food budget, I calculated $10/person per day. Can you cut back restaurant meals or takeout food? Sorry, not 'can you', but 'are you willing to'? Last, there are unlimited way to earn more money. You might not get the $35/hr you make at your day job, but just $15/hr is still $120 for a weekend shift. 2 of those a month can help you kill the debt, and gain some pocket money. A fellow blogger was in IT, but in a tight budget situation like you. He \"\"delivered away his debt\"\" by working for a pizza shop. Simple to do, but he had a goal, and quit when the debt was paid.\"" }, { "docid": "409573", "title": "", "text": "A financial institution is not obligated to offer you a loan. They will only offer you a loan if they believe that they will make money off you. They use all the info available in order to determine if offering you a loan is profitable. In short, whether they offer you a loan, and the interest rate they charge for that loan, is based on a few things: How much does it cost the bank to borrow money? [aka: how much does the bank need to pay people who have savings accounts with them?]; How much does the bank need to spend in order to administer the loan? [ie: the loan officer's time, a little time for the IT guy who helps around the office, office space they are renting in order to allow the transaction to take place]; and How many people will 'default' and never be able to repay their loan? [ex: if 1 out of 100 people default on their loans, then every one of those 100 loans needs to be charged an extra 1% in order to recover the money the bank will lose on the person who defaults]. What we are mostly interested in here is #3: how likely are you to default? The bank determines that by determining your income, your assets, your current debts outstanding, your past history with payments (also called a credit score), and specifically to mortgages, how much the house is worth. If you don't have a long credit history, and because you don't have a long income history, and because you are putting <10% down on the condo [20% is often a good % to strive for, and paying less than that can often imply you will need mandatory mortgage insurance, depending on jurisdiction] the bank is a little more uncertain about your likelihood to pay. Banks don't like uncertainty, and they can deal with that uncertainty in two ways: (1) They can charge you a higher interest rate; OR (2) They can refuse you the loan. Now just because one bank refuses you a loan, doesn't mean all will - but being refused by one bank is probably a good indication that many / most institutions would refuse you, because they all use very similar analytical tools to determine your 'risk level'. If you are refused a loan, you can try again at another institution, or you can wait, save a larger down payment, and build your credit history by faithfully paying your credit card every month, paying your utilities, and making your car and rent payments on time. This will give the banks more comfort that you will have the ability to pay your mortgage every month, and a larger down payment will give them comfort that if the housing market dips, you won't owe more than the house is worth. My parting shot is this: If you are new in your career with no income history, be very careful about buying a property immediately, even if you get approved. A good rule of thumb is to only buy a property when you plan on living there for at least 5 years, or else you are likely to lose money overall, after factoring closing costs and maintenance fees. If you are refused a loan, that's probably a good sign that you aren't financially ready yet, but even if a bank approves you for a loan, you might not be ready yet either." }, { "docid": "451457", "title": "", "text": "\"A major thing to consider when deciding whether to invest or pay off debt is cash flow. Specifically, how each choice affects your cash flow, and how your cash flow is affected by various events. Simply enough, your cash flow is the amount of money that passes through your finances during a given period (often a month or a year). Some of this is necessary payments, like staying current on loans, rent, etc., while other parts are not necessary, such as eating out. For example, you currently have $5,500 debt at 3% and another $2,500 at 5%. This means that every month, your cashflow effect of these loans is ($5,500 * 3% / 12) + ($2,500 * 5% / 12) = $24 interest (before any applicable tax effects), plus any required payments toward the principal which you don't state. To have the $8,000 paid off in 30 years, you'd be paying another $33 toward the principal, for a total of about $60 per month before tax effects in your case. If you take the full $7,000 you have available and use it to pay off the debt starting with the higher-interest loan, then your situation changes such that you now: Assuming that the repayment timeline remains the same, the cashflow effect of the above becomes $1,000 * 3% / 12 = $2.50/month interest plus $2.78/month toward the principal, again before tax effects. In one fell swoop, you just reduced your monthly payment from $60 to $5.25. Per year, this means $720 to $63, so on the $7,000 \"\"invested\"\" in repayment you get $657 in return every year for a 9.4% annual return on investment. It will take you about 11 years to use only this money to save another $7,000, as opposed to the 30 years original repayment schedule. If the extra payment goes toward knocking time off the existing repayment schedule but keeping the amount paid toward the principal per month the same, you are now paying $33 toward the principal plus $2.50 interest against the $1,000 loan, which means by paying $35.50/month you will be debt free in 30 months: two and a half years, instead of 30 years, an effective 92% reduction in repayment time. You immediately have another about $25/month in your budget, and in two and a half years you will have $60 per month that you wouldn't have if you stuck with the original repayment schedule. If instead the total amount paid remains the same, you are then paying about $57.50/month toward the principal and will be debt free in less than a year and a half. Not too shabby, if you ask me. Also, don't forget that this is a known, guaranteed return in that you know what you would be paying in interest if you didn't do this, and you know what you will be paying in interest if you do this. Even if the interest rate is variable, you can calculate this to a reasonable degree of certainty. The difference between those two is your return on investment. Compare this to the fact that while an investment in the S&P might have similar returns over long periods of time, the stock market is much more volatile in the shorter term (as the past two decades have so eloquently demonstrated). It doesn't do you much good if an investment returns 10% per year over 30 years, if when you need the money it's down 30% because you bought at a local peak and have held the investment for only a year. Also consider if you go back to school, are you going to feel better about a $5.25/month payment or a $60/month payment? (Even if the payments on old debt are deferred while you are studying, you will still have to pay the money, and it will likely be accruing interest in the meantime.) Now, I really don't advocate emptying your savings account entirely the way I did in the example above. Stuff happens all the time, and some stuff that happens costs money. Instead, you should be keeping some of that money easily available in a liquid, non-volatile form (which basically means a savings account without withdrawal penalties or a money market fund, not the stock market). How much depends on your necessary expenses; a buffer of three months' worth of expenses is an often recommended starting point for an emergency fund. The above should however help you evaluate how much to keep, how much to invest and how much to use to pay off loans early, respectively.\"" }, { "docid": "437706", "title": "", "text": "Your comment regarding your existing finances is very relevant and helpful. You need to understand that generally in personal finance circles, when a strong earning 22 year-old is looking for a loan it's usually a gross spending problem. Their car costs $1,000 /month and their bar tabs are adding up so the only logical thing to do is get a loan. Most 22-year-olds don't have a mortgage soaking up their income, or a newborn. With all of this in mind I essentially agree with DStanley and, personally, and many people here would probably disagree, I'd stop the 401(K) contribution and use that money to pay the debt. You're still very young from a retirement standpoint, let the current balance ride and forego the match until the debt is paid. I think this is more about being debt free at 22 quickly than it's about how much marginal money could be saved via 401(k) or personal loan or this strategy or that strategy. I think at your age, you'll benefit greatly from simply being debt free. There are other very good answers on this site and other places regarding the pitfalls of a 401(k) loan. The most serious of which is that you have an extremely limited time to pay the entire loan upon leaving the company. Failure to repay in that situation incurs tax liability and penalties. From my quick math, assuming your contribution is 8% of $70,000 /year, you're contributing something in the neighborhood of $460/month to your 401(k). If you stopped contributing you'd probably take home a high $300 number net of taxes. It'll take around 20 months to pay the loan off using this contribution money without considering your existing payments, in total you're probably looking at closer to 15 months. You'll give up something in the neighborhood of $3,500 in match funds over the repayment time. But again, you're 22, you'll resume your contributions at 24; still WAY ahead of most people from a retirement savings standpoint. I don't think my first retirement dollar was contributed until I was about 29. Sure, retirement savings is important, but if you've already started at age 22 you're probably going to end up way ahead of most either way. When you're 60 you're probably not going to bemoan giving up a few grand of employer match in your 20s. That's what I would do. Edit: I actually like stannius's suggestion in the comments below. IF there's enough vested in your plan that is also available for withdrawal that you could just scoop $6,500 out of your 401(k) net of the 10% penalty and federal and state taxes (which would be on the full amount) to pay the debt, I'd consider that instead of stopping the prospective contributions. That way you could continue your contributions and receive the match contributions on a prospective basis. I doubt this is a legitimate option because it's very common for employers to restrict or forbid withdrawal of employee and/or employer contributions made during your employment, but it would be worth looking in to." }, { "docid": "263440", "title": "", "text": "\"In addition to tax-related benefits, one answer may be that it helps them avoid being inundated with requests to support other foundations. Most charities have access to public records that indicate potential donors based on income and demographic. They can use that info to solicit for donations. \"\"Hey NFL Player, you have lots of money, and we have cute starving emus that really need your help!\"\" Here's a blurb from Foundation Source about some of the benefits to starting your own foundation. Get an Immediate Tax Deduction, but Give Later: You get the tax deduction when the foundation is funded, then make your charitable gifts over time. Leave a Lasting Legacy: Foundations set up in perpetuity can burnish your name far beyond your lifetime. Because gifts are made from an endowment that generates investment revenue, the total gifts made by the foundation can far surpass the actual funding. Be Taken More Seriously as a Philanthropist: A foundation imparts a gravitas that causes people to take your philanthropy more seriously, due to the structured, organized approach you employ for your giving. Sidestep Unsolicited Requests: When you focus your foundation on specific giving areas, your mission statement can be used to politely turn down off-target funding requests. Deepen and Focus Your Philanthropy: Whereas individual donors often spread their giving among as many causes as possible, the formalized structure of a foundation often encourages donors to narrow their focus to specific causes. Build a Better Family: As family members take on philanthropic research, present their findings to the board, participate in the decision-making process, and track results, they hone skills that will serve them for years to come. Tax-Deductible Grants to Individuals in Need: A private foundation allows you to provide emergency assistance directly to individuals using dollars for which you’ve already received a tax deduction. Run Charitable Programs Without Setting Up a Separate Nonprofit: Direct charitable activities are IRS-approved programs that permit foundations to directly fund and carry out their own projects. Pay Charitable Expenses: All legitimate and reasonable expenses incurred in carrying out the foundation’s charitable mission can be paid by the foundation and will count toward the annual minimum distribution requirement. Provide Loans Instead of Grants: When used to support a charitable purpose, private foundations can employ loans, loan guarantees, and even equity investments, which are paid back (potentially with interest), so you can recycle your philanthropic capital for other charitable causes. https://www.foundationsource.com/resources/library/top-10-advantages-of-a-private-foundation/ There's a similar list here on the website for an attorney that specializes in philanthropy and non-profits. I won't copy/paste that list as it's similar, but I wanted to provide an additional source confirming the above benefits. This link contains some disadvantages as well. http://www.hurwitassociates.com/l_start_pros.php\"" }, { "docid": "315974", "title": "", "text": "If you have a 20,000 balance and a 8.75% interest rate, you should be paying between $145 and $150 in interest each month, with the balance going to principal. (0.0875/12=0.007292, and that times 20,000 is 145.83; as interest is compounded daily, it'll be a little higher than that.) If the minimum is below $145, then you are not covering the interest; I suspect that is what is happening here, and they're reporting interest paid that wasn't covered in a prior month (assuming you have some months where you only pay the statement minimum, which is less than the total accrued interest). Assuming you're in the US (or most other western countries), your loan servicer should be explaining the exact amount each payment that goes to principal and interest. I recommend calling them up and finding out exactly why it's not consistent; what should be happening, assuming you pay more than the amount of interest each month, is the interest should go down (very) slowly each month and the amount paying off principal should go up (also slowly). EG: Etc., until eventually the interest is zero and your loan is paid off. It probably won't go this quickly for this size of loan - you're only paying off a tiny percentage of principal each month, $50/$20000 or 1/400th - so you won't make too much headway at this rate. Even adding another $25 would make a huge difference to the length of the loan and the amount of interest paid, but that's another story. You will eventually at this rate pay off the loan (at $200 a month for all 12 months); this isn't dissimilar to a 30 year mortgage in terms of percent interest to principal (in fact, it's better!). $50 a month times twelve is $600; 400 payments would take care of it (so a bit over 30 years). However, as you go you pay more principal and less interest, so you will actually pay it off in 15 years if you continue paying $200 a month exactly. What you may be seeing in your case is a combination of things: In months you pay less (ie, $100, say), the extra $45 in interest needs to go somewhere. It effectively becomes part of the principal, but from what I've seen that doesn't always happen directly - ie, they account it differently at least for a short time (up to a year, in my experience). This is because of tax laws, if I understand correctly - the amount you pay in interest is tax-deductible, but not the amount of the principal - so it's important for you to have as much called 'interest' as possible. Thus, if you pay $100 this month and $200 next month, that total of $300 is paying ~$290 of interest and $10 of principal, just as if you'd paid it $150 each month. If you had any penalties, such as for late payments, those come out off the top before interest; they may sometimes take that out as well. All in all, I strongly suggest having an enforced minimum (on your end) of the interest amount at least; that prevents you from being in a situation where your loan grows. If you can't always hit $200, that's fine; but at least hit $150 every single month. Otherwise you have a never ending cycle of student loan debt that you really don't want to be in. Separately, on the $1000 payment: As long as you make sure it's not assigned in such a way that the lender only accepts a month's worth at a time (which shouldn't happen, but there are shady lenders), it shouldn't matter what is called 'principal' and what is called 'interest'. The interest won't go up just because you're making a separate payment (it'll go down!). The portion that goes to interest will go to paying off the amount of interest you owe from the time of your last payment, plus any accrued but unpaid interest, plus principal. You won't have the option of not paying that interest, and it doesn't really matter anyway - it's all something you owe and all accruing interest, it only really matters for accounting and taxes. Double check with your lender (on the phone AND on their website, if possible) that overpayments are not penalized and are applied to principal immediately (or within a few days anyway) and you should be fine." }, { "docid": "91926", "title": "", "text": "\"For the mortgage, you're confusing cause and effect. Loans like mortgages generally have a very simple principle behind them: at any given time, the interest charged at that time is the product of the amount still owing and the interest rate. So for example on a mortgage of $100,000, at an interest rate of 5%, the interest charged for the first year would be $5,000. If you pay the interest plus another $20,000 after the first year, then in the second year the interest charge would be $4,000. This view is a bit of an over-simplification, but it gets the basic point across. [In practice you would actually make payments through the year so the actual balance that interest is charged on would vary. Different mortgages would also treat compounding slightly differently, e.g. the interest might be added to the mortgage balance daily or monthly.] So, it's natural that the interest charged on a mortgage reduces year-by-year as you pay off some of the mortgage. Mortgages are typically setup to have constant payments over the life of the mortgage (an \"\"amortisation schedule\"\"), calculated so that by the end of the planned mortgage term, you'll have paid off all of the principal. It's a straightforward effect of the way that interest works in general that these schedules incorporate higher interest payments early on in the mortgage, because that's the time when you owe more money. If you go for a 15-year mortgage, each payment will involve you paying off significantly more principal each time than with a 30-year mortgage for the same balance - because with a 15-year mortgage, you need to hit 0 after 15 years, not 30. So since you pay off the principal faster, you naturally pay less interest even when you just compare the first 15 years. In your case what you're talking about is paying off the mortgage using the 30-year payments for the first 15 years, and then suddenly paying off the remaining principal with a lump sum. But when you do that, overall you're still paying off principal later than if it had been a 15-year mortgage to begin with, so you should be charged more interest, because what you've done is not the same as having a 15-year mortgage. You still will save the rest of the interest on the remaining 15 years of the term, unless there are pre-payment penalties. For the car loan I'm not sure what is happening. Perhaps it's the same situation and you just misunderstood how it was explained. Or maybe it's setup with significant pre-payment penalties so you genuinely don't save anything by paying early.\"" }, { "docid": "365293", "title": "", "text": "Firstly, thank you for taking the time to respond, let me see what I can answer to help give you a bigger picture. * I am the rental manager but like I say, it's a small unit where the operations team is only 5 strong. We all have a hand in everything really and it was my precedent for implementing procedures in the past that triggered them to ask me into looking into this. * Honestly, I don't think I have much of a budget. That being said, if there's a price to anything and I can justify the company spending the money, they will be fair. From a personal perspective, I never even considered that third party software would be required for this kind of thing. If there's any you could recommend (licensed or open sourced) that would be greatly appreciated. * From what I can tell, the people in charge want a process in which we can fully understand CSAT from both a service and product standpoint. We can use the information gathered from our service feedback to improve ourselves and we can use the information gathered about the vehicles we lease (the products) so we can market them correctly in the future. Seeing how the customer feels on the vehicle's fuel economy, performance, comfort on the driver, downtime, etc. which can lead us to marketing the vehicles better or influence what vehicles we purchase moving on. * For the most part, I think the working processes are going to remain the same, where the customer support manager will have a more active role in getting these calls/visits/emails out to the customers and react accordingly. Again, thank you so much for your help." }, { "docid": "460357", "title": "", "text": "\"Tell them you will not loan them any more money until their existing debts are paid off. This is closer to how the real world works and it won't come across as vengeful or like your changing your initial \"\"contract\"\". If they protest, lovingly tell them that your money is not their money, and that an interest free loan from their father is a privilege, not a right. As far as charging interest on your loans, go for it! Charge them 5% or something small. Just don't do it on the existing loans or that will come across as changing your initial \"\"contract\"\" again, and perhaps once they've proven themselves to be reliable borrowers they can once again earn the privilege to have an interest free loan. The book \"\"The Millionaire Next Door\"\" has really good thoughts on this in its section on Economic Outpatient Care.\"" }, { "docid": "350980", "title": "", "text": "If it were me, I'd be debt free today, Monday, at latest. 100K-(53K+31.2K) = 15.8K would be my bank balance by this afternoon. I am not sure why you would count 6K of your daughter's money as yours to use. Either it is her money, or yours, not both. If you still want debt, which I think is silly, you might try to refi your home with a home equity loan. That loan would be in first position, at a fixed rate, and for a fixed term. Regions bank did some thing like this for a person with excellent credit and plenty of equity. They got a 7 year loan at 2.6% when the prevailing interest rate on a 15 year was about a point higher." }, { "docid": "192602", "title": "", "text": "Paying the minimum balance on a loan can be DEVASTATING and is highly UN-RECOMMENDED. It is important you understand your loan and the terms associated with it. Loans are given for a period of time but if you pay the minimum it does NOT mean you will pay it all off by the end. When paying a loan money is applied to the interest first and any extra amount is then applied to the principle. Here's an example: If I have a $12 loan for 1 year. The interest is 100%. My minimum payment each month is $1. If I pay that minimum only I will be stuck paying $12 at the end of the loan. Why you ask? because each month I'm being charged $1 interest and the payment I am making is only going towards that interest. However if I paid $2 instead now $1 goes to the principal (the original $12 I borrowed). This means that next month I will only be charged interest on $11 dollars instead of $12. You need to know how much is going towards the interest of your loan and how much is going towards the principle you can speak with your bank about this and they will help you understand. In many cases they actually provide you with the numbers on your statment with examples of how long it would take to payoff your loan with minimum only and how long it would take if you added an extra x amount each month. I recommend using the Snowball Method to pay of your debt. It's simple and effective. How much you should add to each monthly payment depends on how much you can afford to add. Here are some calculators you can play around with: CNN Money Bank Rate Calc Edit: So with the additional information you provided we can estimate that you have about 2200 free cash flow each month(that's your cash after you pay all your bills). We can put away 500 each month for a rainy day fund, just to be safe.(job loss, accidents, or anything we can't predict) So assuming that is all your expenses including the money you spend on entertainment. That leaves you with $1700 you can add on to your loan payments. So you can pay off your third loan in 1 month. Then add the remaining balance to the 2nd loan. With this income it should take you less then a year to pay off all your loans." }, { "docid": "462036", "title": "", "text": "\"This may be a bit advanced now, but once you start really working and get a place, I think this will apply more... Do I set up a bank account now? Yes. There is no reason not to. As an adult you will be using this much more than you think. Assuming you have a little money, you can walk in to any bank almost any day of the week and set up an account with them in very little time. Note that they may require you to be 18 if your parents won't be with you on the account. Otherwise, just ask any bank representative to help you do this. Just to be clear, if you can get a credit union account over a typical bank account, this is a great idea. Credit unions provide exactly the same financial services as a normal bank, but typically have variety of advantages over banks. Bank Account Parts Bank accounts typically have two parts, a checking account and a savings account. Your checking account typically is what you use for most day-to-day transactions and your savings account is generally used for, well, saving money. Having a bank account often gives you the following advantages: They give you an ability to store money without having large amounts of cash on hand. Once you start working regularly, you'll find you won't want to keep ~$600+ cash every two weeks in your wallet or apartment. They help you pay bills. When you set up your bank account, you will likely be able to get a Visa debit card which will process like a regular credit card but simply deduct funds from your checking account. You can use this card online to pay utilities (i.e. electricity and water), general bills (e.g. your cell phone and cable), purchase items (ex. at Amazon) or use it in stores to pay in lieu of cash. Be aware -- some banks will give you an ATM-only card before they send you the Visa debit card in the mail. This ATM-only card can only be used at ATMs as it's name implies. Similarly, if you can invest about ~$200 to build your credit, you can often get a deposit secured credit card attached to your account (basically a credit card where the bank keeps your money in case you can't pay your bill). If you treat this card with responsibility, you can eventually transition to an unsecured credit card. They save you hassles when cashing your check. If you don't have a bank where you can cash your check (e.g. you don't have an account), you will likely be charged check cashing fees (usually by places such as grocery stores or payday loan chains, or even other banks). Furthermore, if your check is over a certain amount, some places may refuse to cash your check period and a bank may be your only option. They give you a way to receive money electronically. The most common example of this is direct deposit. Many employers will send your money directly to your bank account instead of requiring you to cash a check. If they are prompt, this money gets to you faster and saves you trouble (on payday, you'll just receive a pay stub detailing your wages and the amount deposited rather than a check). Also, since you asked about taxes, you should know that when you do eventually file with the IRS, they have an option to receive your tax refund electronically as well (e.g. direct deposit into your bank account) and that can literally save you months in some cases depending on when you file your return and how many paper checks they have to process. Does it cost money to setup? It depends. Some banks have special offers, some don't. Most places will set up an account for free, but may require a minimum deposit to open the account (typically $50-$100). The Visa debit card mentioned above generally comes free. If you want a secured credit card as above, you will want about an additional $200 (so $250 - $300 total). Note that this is absolutely NOT required. You can exclusively use the Visa debit card above if you wish. Bank Account Fees Any fees charged when you have a bank account are usually minor anymore. Regardless, the bank will hand you a whole bunch of paperwork (mostly in legalese) detailing exactly how your account works. That said, the bank person helping set things up will cover what you need to know about keeping the account in plain English. The most common types of fee associated with a bank account are monthly maintenance fees and overdraft fees, but these aren't always necessarily charged. Likewise, there may be some other fees associated with the account but these vary from bank to bank. Monthly Maintenance Fees To give some examples... Overdraft Fees Overdraft fees are typically charged when you attempt to spend more money than you have in your bank account and the bank has to cover these charges. Overdraft fees typically apply to using paper checks (which it is unlikely you will be using), but not always. That said, it is very unlikely you will be charged overdraft fees for three reasons: Many banks have done away with these fees in lieu of other ways of generating revenue. Banks that still charge these fees usually have \"\"overdraft protection\"\" options for a little more money a month, effectively negating the possibility you will be charged these fees. The ability to deduct an amount of money from your checking account is now typically checked electronically before the payment is authorized. That is, using a Visa debit card, the card balance is checked immediately, and even when using paper check, most retailers have check scanning machines that do roughly the same thing. On a personal note, the bank that I have allows my account to be deducted below my checking account balance only if the payment is requested electronically (e.g. someone who has my card information charges me for a monthly service). In this case, the funds are simply listed in the negative and deducted from any amount I deposit till the proper amount is repaid (e.g. if I'm at -$25 dollars due to a charge when my account balance was $0 and then I deposit $100, my available balance will then be $75, not $100). Finally, per the comment by @Thebluefish, while I minimize the likelihood you will be charged overdraft fees, it is good to check into the exact circumstances under which you might be charged unexpectedly by your bank. Read the documentation they give you carefully, including any mailed updates, and you'll reduce the chance of receiving a nasty surprise. For reference, here are some of the fees charged by Bank of America. What about taxes? When you begin working, an employer will usually have you fill out a tax form such as a W-4 Employee's Withholding Allowance Certificate so that your employer can withhold the correct federal income tax from your wages. If they don't, then it is your responsibility to calculate and file your own income taxes (if you are self-employed, an independent contractor or paid under the table). If your employer is reputable, they will send you additional information (generally in February) you need to properly file your taxes prior to April 15th (the IRS tax deadline for most people). This additional information will likely be some variation of a W-2 Wage and Tax Statement or possibly a Form 1099-MISC. Do I have to worry about money in my bank account? Unless you have a significant amount in your bank savings account earning interest (see \"\"Should I save for the future?\"\" below), you won't have to pay any sort of tax on money in your bank account. If you do earn enough taxable interest, the bank will send you the proper forms to file your taxes. How do I file taxes? While it won't apply till next year, you will likely be able to fill out a Form 1040EZ Income Tax Return for Single and Joint Filers With No Dependents, as long as you don't have any kids in the meantime. ;-) You will either mail in the paper form (available at your local IRS office, post office, public library, etc.) or file electronically. There will be a lot of information on how to do this when the time comes, so don't worry about details just yet. Assuming your all paid up on your taxes (very likely unless you get a good paying job and take a lot of deductions throughout the year on your W-4), you'll probably get money back from the IRS when you file your tax return. As I mentioned above, if you have a bank account, you can opt to have your refund money returned electronically and get it much sooner than if you didn't have a bank account (again, possibly saving you literal months of waiting). Should I save for my future? If so, how much? Any good articles? Yes, you should save for the future, and start as soon as possible. It's outside the scope of this answer, but listen to your Economics professor talk about compound interest. In short, the later you start saving, the less money you have when you retire. Not that it makes much difference now, but you have to think that over 45 years of working (age 20-65), you likely have to have enough money for another 20+ years of not working (65-85+). So if you want $25,000 a year for retirement, you need to make ~$50,000 - $75,000 a year between your job and any financial instruments you have (savings account, stocks, bonds, CDs, mutual funds, IRAs, job retirement benefits, etc.) Where you should stick money your money is a complicated question which you can investigate at length as you get older. Personally, though, I would recommend some combination of IRA (Individual Retirement Account), long term mutual funds, and some sort of savings bonds. There is a metric ton of information regarding financial planning, but you can always read something like Investing For Dummies or you can try the Motley Fool's How To Invest (online and highly recommended). But I'm Only 17... So what should you do now? Budget. Sounds dumb, but just look at your basic expenses and total them all up (rent, utilities, phone, cable, food, gas, other costs) and divide by two. Out of each paycheck, this is how much money you need to save not to go into debt. Try to save a little each month. $50 - $100 a month is a good starting amount if you can swing it. You can always try to save more later. Invest early. You may not get great returns, but you don't need much money to start investing. Often you can get started with as little as $20 - $100. You'll have to do research but it is possible. Put money in your savings account. Checking accounts do not typically earn interest but money in savings accounts often do (that is, the bank will actually add money to your savings assuming you leave it in there long enough). Unfortunately, this rate of interest is only about 3.5% on average, which for most people means they don't get rich off it. You have to have a significant amount of money ($5,000+) to see even modest improvements in your savings account balance each month. But still, you may eventually get there. Get into the habit of putting money places that make you money in the long run. Don't go into debt. Don't get payday loans, pawn items, or abuse credit cards. Besides wrecking your credit, even a small amount of debt ($500+) can be very hard to break out of if you don't have a great paying job and can even make you homeless (no rent means no apartment). Remember, be financially responsible -- but assuming your parents aren't totally tight with money, don't be afraid to ask for cash when you really need it. This is a much better option than borrowing from some place that charges outrageous interest or making your payments late. Have an emergency account. As already mentioned in another excellent answer, you need to have money to \"\"smooth things out\"\" when you encounter unexpected events (your employer has trouble with your check, you have to pay for some sort of repair bill, you use more gas in your car in a month than normal, etc.) Anywhere from $200 - $2000+ should do it, but ideally you should have at least enough to cover a month of basic expenses. Build good credit. Avoid the temptation to get a lot of credit cards, even if stores and banks are dying to give them to you. You really only need one to build good credit (preferably a secured one from your bank, as mentioned above). Never charge more than you can pay off in a single month. Charging, then paying that amount off before the due date on your next statement, will help your credit immensely. Likewise, pay attention to your rent, utilities and monthly services (cell phone, cable, etc.). Even though these seem like options you can put off (\"\"Oh my electric bill is only $40? I'll pay that next month...\"\") late payments on all of these can negatively affect your credit score, which you will need later to get good loans and buy a house. Get health insurance. Now that the Affordable Care Act (ACA a.k.a Obamacare) has been enacted, it is now simpler to get health insurance, and it is actually required you have some. Hopefully, your employer will offer health coverage, you can find reasonably priced coverage on your own, or you live in a state with a health exchange. Even if you can't otherwise get/afford insurance, you may qualify for some sort of state coverage depending on income. If you don't have some sort of health insurance (private or otherwise), the IRS can potentially fine you when you file your taxes. Not to be too scary, but the fine as currently proposed is jumping up to about $700 for individuals in 2016 or so. So... even if you don't grab health insurance (which you absolutely should), you need to save about $60 a month, even if just for the fine. This answer turned out a bit longer than intended, but hopefully it will help you a little bit. Welcome to the wonderful world of adult financial responsibility. :-)\"" }, { "docid": "282379", "title": "", "text": "\"I think there's value in charging family members/friends interest if it will make them take the loan seriously. The problem is that if you're thinking about charging interest because the person seems to be borrowing from you too cavalierly, it may be too late to make them take it seriously. In the situation you describe, if you're concerned about the loans being paid back, I think you need to have a serious conversation with the kids and make it clear you expect them to pay the loans back on whatever schedule you agreed to. If, based on your knowledge of your kids, you think charging interest would help motivate them to do this, great. If not, charging interest is unlikely to accomplish anything that the conversation itself won't accomplish. If you haven't previously outlined a specific schedule or set of expectations for how you want to be paid back, just doing that (in writing) may be enough to make them realize it's not a joke. The conventional wisdom is that you shouldn't lend money to anyone unless you're either a) okay with never being paid back; or b) willing to pursue legal remedies to ensure you're paid back. Most people aren't willing to sue their own family members over small loans, which means in most cases it's not a good idea to loan money to family unless you're \"\"okay with\"\" never being repaid (whatever level of \"\"okay with\"\" makes sense for you). I should note that I don't have kids; my advice here is just how I would handle it if I were considering loaning money to my brother or a close friend or the like. This means I don't really know anything about \"\"teaching the kids about the real world\"\", but I have to say my hunch is that if your kids are 25+ and married, it's too late to radically change their views on how \"\"the real world\"\" works; unless they had a very sheltered early adulthood, they've been living in the real world for too long and will have their own ideas of how it works.\"" }, { "docid": "134063", "title": "", "text": "Plus you already have money in a 529 plan that is meant for college expenses (and cannot be used to pay student loans) - use that money for what it's for. I disagree with @DStanley, as a current college student I would say to take out loans. Most of the time I am against loans though. So WHY? There are very few times you will receive loans at 0% interest (for 4+ years). You have money saved currently, but you do not know what the future entails. If you expend all of your money on tuition and your car breaks down, what do you do? You can not used student loans to pay for your broken car.Student loans, as long as they are subsidized, serve as a wonderful risk buffer. You can pay off your loans with summer internships and retain the initial cash you had for additional activities that make college enjoyable, i.e - Fraternity/ Sorority, clubs, dinners, and social nights. Another benefit to taking these loans would assist in building credit, with an additional caveat being to get a credit card. In general, debt/loans/credit cards are non-beneficial. But, you have to establish debt to allow others to know that you can repay. Establishing this credit rating earlier than later is critical to cheaper interest rates on (say) a mortgage. You have made it through, you have watched your expenses, and you can pay your debt. Finish It. If you do it right, you will not have loans when you graduate, you will have a stunning credit rating, and you will have enjoyed college to its fullest potential (remember, you only really go through it once.) But this is contingent on: Good luck, EDIT: I did not realize the implication of this penalty which made me edit the line above to include: (to the extent you can per year) For now, student loan repayment isn't considered a qualified educational expense. This means that if you withdraw from a 529 to pay your debts, you may be subject to income taxes and penalties.Source Furthermore, Currently, taxpayers who use 529 plan money for anything other than qualified education expenses are subject to a 10% federal tax penalty. Source My advice with this new knowledge, save your 529 if you plan on continuing higher education at a more prestigious school. If you do not, use it later in your undergraduate years." }, { "docid": "450830", "title": "", "text": "\"The bottom line is that you are kind of a terrible customer for them. Granted you are far better than one that does not pay his bills, but you are (probably) in the tier right above that. Rewards cards are used to lure the unorganized into out of control interest rates and late payments. These people are Capital One's, and others, best customers. They have traded hundreds of dollars in interest payments for a couple of dollars in rewards. The CC company says: \"\"YUMMY\"\"! You, on the other hand, cut into their \"\"meager\"\" profits from fees collected from your transactions. Why should they help you make more money? Why should they further cut into your profits? Response to comment: Given your comment I think the bottom line is a matter of perspective. You seem like a logical, altruistic type person who probably seeks a win-win situation in business dealings. This differs from CC companies they operate to seek one thing: enslavement. BTW the \"\"terrible customer\"\" remark should be taken as a compliment. After you get past the marketing lies you begin to see what reward programs and zero percent financing is all about. How do most people end up with 21%+ interest rates? They started with a zero percent balance loan, and was late for a payment. Reward cards work a bit differently. Studies show that people tend to spend about 17% more when they use a reward card. I've caught myself ordering an extra appetizer or beer and have subsequently stopped using a reward card for things I can make a decision at the time of purchase. For people with tight budgets this leads to debt. My \"\"meager\"\" profits paragraph makes sense when you understand the onerous nature of CC companies. They are not interested in earning 2% on purchases (charge 3% and give back 1%) for basically free money. You rightly see this as what should be a win-win for all parties involved. Thus the meager in quotation marks. CC companies are willing to give back 1% and charge 3% if you then pay 15% or more on your balance. Some may disagree with me on the extracting nature of CC companies, but they are wrong. I like him as an actor, but I don't believe Samuel Jackson's lines.\"" }, { "docid": "317419", "title": "", "text": "I see you've marked an answer as accepted but I MUST tell you that STOPPING your 401k contribution all together is a bad idea. Your company match is 100% rate of return(or 50% depending on structure). I don't care what market you look at, or how bad a loan you take out, you will not receive 100% rate of return, or be charged 100% interest. Further, taking out a loan against your 401k effectively does two things: It is a loan that must be repaid according to the terms of your 401k AND in every 401k I've ever encountered, you cannot make contributions to the 401k until the loan is repaid. This in effect stops your contributions, and will almost certainly save you very little on your interest rates on your current loans. I have 4 potential solutions that may help achieve your goal without sacrificing your 401k match and transferring the debt from one lender to another, but they are conditional. Is your company match 100% up to 4% of your salary, or 50% of your contribution (up to a limit you have not yet reached)? This is important. If it is 100% up to 4%, stop committing the additional 4% and use that to pay down your debt...and after ward set up that 4% as auto pay into an IRA, not into the 401k. An IRA will make you more money because YOU have control over its management, not your employer. If it is 50% match, contribute until the match is met because you cannot get 50% rate of return anywhere, then take your additional monies and get an IRA. As far as your debt, in this scenario simply suck it up and pay it as is. You will lose far more than you gain by stopping your contributions. If you simply must reduce your expenses by 150$ month try refinancing the mortgage and rolling the 6500$ into it. If you get a big enough drop in the interest rate you could still end up paying less. OR If you cannot make the gain there, try snowballing the three payments. You do this by calling your student loan vendor and telling them you need to make much smaller payments, like even zero depending on the type of loan. Then take ALL of the money you are currently spending on the 3 loans and put into the car payment. When it's gone, roll the whole thing into the higher interest student loan, then finally roll it all into the last student loan. You'll pay it off faster, and student loans have lots of laws and regulations regarding working with payers to keep them paying something without breaking them. WHATEVER YOU DO, DO NOT STOP YOUR CONTRIBUTIONS. 50% OR 100%, THAT MONEY IS GUARANTEED AT A HIGHER RATE OF RETURN THAN YOU CAN GET ANYWHERE, ESPECIALLY GUARANTEED." }, { "docid": "257483", "title": "", "text": "\"First of all, congratulations on admitting your problem and on your determination to be debt-free. Recognizing your mistakes is a huge first step, and getting rid of your debt is a very worthwhile goal. When considering debt consolidation, there are really only two reasons to do so: Reason #1: To lower your monthly payment. If you are having trouble coming up with enough money to meet your monthly obligations, debt consolidation can lower your monthly payment by extending the time frame of the debt. The problem with this one is that it doesn't help you get out of debt faster. It actually makes it longer before you are out of debt and will increase the total amount of interest that you will pay to the banks before you are done. So I would not recommend debt consolidation for this reason unless you are truly struggling with your cashflow because your minimum monthly payments are too high. In your situation, it does not sound like you need to consolidate for this reason. Reason #2: To lower your interest rate. If your debt is at a very high rate, debt consolidation can lower your interest rate, which can reduce the time it will take to eliminate your debt. The consolidation loan you are considering is at a high interest rate on its own: 13.89%. Now, it is true that some of your debt is higher than that, but it looks like the majority of your debt is less than that rate. It doesn't sound to me that you will save a significant amount of money by consolidating in this loan. If you can obtain a better consolidation loan in the future, it might be worth considering. From your question, it looks like your reasoning for the consolidation loan is to close the credit card accounts as quickly as possible. I agree that you need to quit using the cards, but this can also be accomplished by destroying the cards. The consolidation loan is not needed for this. You also mentioned that you are considering adding $3,000 to your debt. I have to say that it doesn't make sense at all to me to add to your debt (especially at 13.89%) when your goal is to eliminate your debt. To answer your question explicitly, yes, the \"\"cash buffer\"\" from the loan is a very bad idea. Here is what I recommend: (This is based on this answer, but customized for you.) Cut up/destroy your credit cards. Today. You've already recognized that they are a problem for you. Cash, checks, and debit cards are what you need to use from now on. Start working from a monthly budget, assigning a job for every dollar that you have. This will allow you to decide what to spend your money on, rather than arriving at the end of the month with no idea where your money was lost. Budgeting software can make this task easier. (See this question for more information. Your first goal should be to put a small amount of money in a savings account, perhaps $1000 - $1500 total. This is the start of your emergency fund. This money will ensure that if something unexpected and urgent comes up, you won't be so cash poor that you need to borrow money again. Note: this money should only be touched in an actual emergency, and if spent, should be replenished as soon as possible. At the rate you are talking about, it should take you less than a month to do this. After you've got your small emergency fund in place, attack the debt as quickly and aggressively as possible. The order that you pay off your debts is not significant. (The optimal method is up for debate.) At the rate you suggested ($2,000 - 2,500 per month), you can be completely debt free in maybe 18 months. As you pay off those credit cards, completely close the accounts. Ignore the conventional wisdom that tells you to leave the unused credit card accounts open to try to preserve a few points on your credit score. Just close them. After you are completely debt free, take the money that you were throwing at your debt, and use it to build up your emergency fund until it is 3-6 months' worth of your expenses. That way, you'll be able to handle a small crisis without borrowing anything. If you need more help/motivation on becoming debt free and budgeting, I recommend the book The Total Money Makeover by Dave Ramsey.\"" } ]

[ { "docid": "574948", "title": "", "text": "This sounds like a shady trick. I would consult with a consumer debt lawyer in your area. Most county bar associations in the US have a referral service, where they recommend a local lawyer and there is a reduced fee for the initial visit. I think the statute of limitations is 10 years in most cases, but it depends on where you live. From these bare details,I think they don;t have much of a case. Go see a lawyer and don't let them harrass you." } ]

[ { "docid": "570921", "title": "", "text": "\"I added the tag 'budget' to your question. A detailed budget is the ideal tool for someone in your situation. And the details you offer indicate to me that's exactly what you've done. This first step is out of the way. Our (US) Vice President has a saying \"\"Don’t tell me what you value. Show me your budget and I will tell you what you value.\"\" In this light, I suggest you consider each and every item in your budget. With $87 left this past month, consider how cutting back a bit and finding a way to not spend another $45, less than 1% of that budget, will increase that savings over 50%. Every item can be lowered. If you took a cab, why not take public transportation. For cabs, can you car-pool, and join up with coworkers to share the ride? Can you downsize the apartment or get a bigger one but with a roommate? I've seen people do this. They go from a tiny one bedroom to a larger 2 bedroom that costs 50% more, but they are just paying half the rent. They also save on utilities, internet, etc. When I analyzed my food budget, I calculated $10/person per day. Can you cut back restaurant meals or takeout food? Sorry, not 'can you', but 'are you willing to'? Last, there are unlimited way to earn more money. You might not get the $35/hr you make at your day job, but just $15/hr is still $120 for a weekend shift. 2 of those a month can help you kill the debt, and gain some pocket money. A fellow blogger was in IT, but in a tight budget situation like you. He \"\"delivered away his debt\"\" by working for a pizza shop. Simple to do, but he had a goal, and quit when the debt was paid.\"" }, { "docid": "385506", "title": "", "text": "A loan is most generally a liability, a part of the balance sheet. Expenses & income are part of the income statement. Income is the net of revenues after expenses. The interest is an expense on the income statement, but the loan itself does not reside there unless if it is defaulted and forgiven. Then it would become a revenue or contra-expense, depending on the methodology. The original purpose of the income statement is to show the net inflows of short term operational accruals which would exclude new borrowing and repaid loans. The cash flow statement will better show each cash event such as borrowing debt, repaying debt, or paying off a bill. To show how a loan may have funded a bill, which in theory it directly did not because an entity, be it a person or business, is like a single tank of water with multiple pipes filling and multiple pipes extracting, so it is impossible to know which exact inflow funded which exact outflow unless if there is only one inflow per period and one outflow per the same period. That being said, with a cash flow statement, the new loan will show a cash inflow when booked under the financing portion, and paying a bill will show a cash outflow when booked under the operating portion. With only those two transactions booked and an empty balance sheet beforehand, it could be determined that a new loan funded a bill payment." }, { "docid": "437706", "title": "", "text": "Your comment regarding your existing finances is very relevant and helpful. You need to understand that generally in personal finance circles, when a strong earning 22 year-old is looking for a loan it's usually a gross spending problem. Their car costs $1,000 /month and their bar tabs are adding up so the only logical thing to do is get a loan. Most 22-year-olds don't have a mortgage soaking up their income, or a newborn. With all of this in mind I essentially agree with DStanley and, personally, and many people here would probably disagree, I'd stop the 401(K) contribution and use that money to pay the debt. You're still very young from a retirement standpoint, let the current balance ride and forego the match until the debt is paid. I think this is more about being debt free at 22 quickly than it's about how much marginal money could be saved via 401(k) or personal loan or this strategy or that strategy. I think at your age, you'll benefit greatly from simply being debt free. There are other very good answers on this site and other places regarding the pitfalls of a 401(k) loan. The most serious of which is that you have an extremely limited time to pay the entire loan upon leaving the company. Failure to repay in that situation incurs tax liability and penalties. From my quick math, assuming your contribution is 8% of $70,000 /year, you're contributing something in the neighborhood of $460/month to your 401(k). If you stopped contributing you'd probably take home a high $300 number net of taxes. It'll take around 20 months to pay the loan off using this contribution money without considering your existing payments, in total you're probably looking at closer to 15 months. You'll give up something in the neighborhood of $3,500 in match funds over the repayment time. But again, you're 22, you'll resume your contributions at 24; still WAY ahead of most people from a retirement savings standpoint. I don't think my first retirement dollar was contributed until I was about 29. Sure, retirement savings is important, but if you've already started at age 22 you're probably going to end up way ahead of most either way. When you're 60 you're probably not going to bemoan giving up a few grand of employer match in your 20s. That's what I would do. Edit: I actually like stannius's suggestion in the comments below. IF there's enough vested in your plan that is also available for withdrawal that you could just scoop $6,500 out of your 401(k) net of the 10% penalty and federal and state taxes (which would be on the full amount) to pay the debt, I'd consider that instead of stopping the prospective contributions. That way you could continue your contributions and receive the match contributions on a prospective basis. I doubt this is a legitimate option because it's very common for employers to restrict or forbid withdrawal of employee and/or employer contributions made during your employment, but it would be worth looking in to." }, { "docid": "474573", "title": "", "text": "\"@Joe's original answer and the example with proportionate application of the payment to the two balances is not quite what will happen with US credit cards. By US law (CARD Act of 2009), if you make only the minimum required payment (or less), the credit-card company can choose which part of the balance that sum is applied to. I am not aware of any company that chooses to apply such payments to anything other than that part of the balance which carries the least interest rate (including the 0% rate that \"\"results\"\" from acceptance of balance transfer offers). If you make more than the minimum required payment, then the excess must, by law, be applied to paying off the highest rate balance. If the highest rate balance gets paid off completely, any remaining amount must be applied to second-highest rate balance, and so on. Thus, it is not the case that that $600 payment (in Joe's example) is applied proportionately to the $5000 and $1000 balances owed. It depends on what the required minimum payment is. So, what would be the minimum required payment? The minimum payment is the total of (i) all finance charges incurred during that month, (ii) all service fees and penalties (e.g. fee for exceeding credit limit, fee for taking a cash advance, late payment penalty) and other charges (e.g. annual card fee) and (iii) a fraction of the outstanding balance that (by law) must be large enough to allow the customer to pay off the entire balance in a reasonable length of time. The law is silent on what is reasonable, but most companies use 1% (which would pay off the balance over 8.33 years). Consider the numbers in Joe's example together with the following assumptions: $5000 and $1000 are the balances owed at the beginning of the month, no new charges or service fees during that month, and the previous month's minimum monthly payment was made on the day that the statement paid so that the finance charge for the current month is on the balances stated). The finance charge on the $5000 balance is $56.25, while the finance charge on the $1000 balance is $18.33, giving a minimum required payment of $56.25+18.33+60 = $134.58. Of the $600 payment, $134.58 would be applied to the lower-rate balance ($5000 + $56.25 = $5056.25) and reduce it to $4921.67. The excess $465.42 would be applied to the high-rate balance of $1000+18.33 = $1018.33 and reduce it to $552.91. In general, it is a bad idea to take a cash advance from a credit card. Don't do it unless you absolutely must have cash then and there to buy something from a merchant who does not accept credit cards, only cash, and don't be tempted to use the \"\"convenience checks\"\" that credit-card companies send you from time to time. All such cash advances not only carry larger rates of interest (there may also be upfront fees for taking an advance) but any purchases made during the rest of the month also become subject to finance charge. In other words, there is no \"\"grace period\"\" for new charges, and this state of affairs will last for one month beyond the first credit-card statement whose statement is paid off in full in timely fashion. Finally, turning to the question asked, viz. \"\" I am trying to determine how much I need to pay monthly to zero the balance, ....\"\", as per the above calculations, if the OP makes the minimum required payment of $134.58 plus $1018.33, that $134.58 will be applied to the low-rate balance and the rest $1018.33 will pay off the high-rate balance in full if the payment is made on the day the statement is issued. If payment is made later, but before the due date, that $1018.33 will be accruing finance charges until the date the payment is made, and these will appear as 22% rate balance on next month's statement. Similarly for the low-rate balance. What if several monthly payments will be required? The best calculator known to me is at https://powerpay.org (free but it is necessary to set up a username and password). Enter in all the credit card balances and the different interest rates, and the total amount of money that can be used to pay off the balances, and the site will lay out a payment plan. (Basically, pay off the highest-interest rate balance as much as possible while making minimum required payments on the rest). Most people are surprised at how much can be saved (and how much shorter the time to be debt-free is) if one is willing to pay just a little bit more each month.\"" }, { "docid": "197796", "title": "", "text": "Ditto to Victor. The simple rule is: Pay the minimums on all so you don't get any late fees, etc, then pay off the highest interest rate loan first. A couple of special cases do come to mind: If one or more of these are credit cards, then, here in the U.S. at least, credit cards charge you interest on the average daily balance, unless you pay off the balance entirely, in which case you pay zero interest. So for example say you had two credit cards, both with 1% per month interest, with debt of $2000 and $1000. You have $1500 available. Ignoring minimum payments for the moment, if you put that $1500 against the larger balance, you would still pay interest on the full amount for the current month, or $30. But if you paid off the smaller and put the difference against the larger, then your interest for the current month would be only $15. (Either way, your interest for NEXT month would be the same -- 1% of the $1500 remaining balance or $15 -- assuming you couldn't pay off the other card.) If one or more of the loans are mortgage loans on which you are paying mortgage insurance, then when you get the balance below a certain point -- usually 80% of the original loan amount -- you no longer have to pay mortgage insurance premiums. Thus the amount you are paying on such premiums needs to be factored into the calculation. There may be other special cases. Those are the ones that I've run into." }, { "docid": "372993", "title": "", "text": "\"I had to apply for an American Express card, which was also rejected. Then I had searched for a Marbles Credit Card Stop applying for credit cards/loans. Doing so is just making your credit rating worse. Credit agencies will downgrade your credit rating if they see lots of signs of credit checking. It's a sign you're desperately looking for credit, which you are...! 44.9% APR This is very expensive credit. You can get personal loans on the high street for 3-4%. 44.9% is really bad value. You're simply going to make the situation worse. Am I taking off a loan from website as amingos loans to help me build up my credit rating Again this is 44% interest! You also need a guarantor. So you're not only going to get yourself in trouble but a family member too: don't do this! This will only help your credit rating if you pay it back successfully, which given your situation seems like a risk. Contact the Money Advice Service or the National Debt Line. Explain your situation in detail to them. They are a government-backed service designed for people in your situation. They will offer practical advice and can even help negotiate with your creditors, etc. Here's some general advice about getting out of debt from Money Saving Expert Traditional debt help says 'never borrow your way out of a debt problem'. But this ignores the varying cost of different debts. The MoneySaving approach is: \"\"Never borrow more to get out of a debt problem.\"\"\"" }, { "docid": "345403", "title": "", "text": "\"Congratulations. The first savings goal should be an emergency fund. Think of this not as an investment, but as insurance against life's woes. They happen and having this kind of money earmarked allows one to invest without needing to withdraw at an inopportune time. This should go into a \"\"high interest\"\" savings account or money market account. Figure three to six months of expenses. The next goal should be retirement savings. In the US this is typically done through 401K or if your company does not offer one, either a ROTH IRA or Traditional IRA. The goal should be about 15% of your income. You should favor a 401k match over just about anything else, and then a ROTH over that. The key to transforming from a broke college student into a person with a real job, and disposable income, is a budget. Otherwise you might just end up as a broke person with a real job (not fun). Part of your budget should include savings, spending, and giving. All three areas are the key to building wealth. Once you have all of those taking care of the real fun begins. That is you have an emergency fund, you are putting 15% to retirement, you are spending some on yourself, and giving to a charity of your choice. Then you can dream some with any money left over (after expenses of course). Do you want to retire early? Invest more for retirement. Looking to buy a home or own a bunch of rental property? Start educating yourself and invest for that. Are you passionate about a certain charity? Give more and save some money to take time off in order to volunteer for that charity. All that and more can be yours. Budgeting is a key concept, and the younger you start the easier it gets. While the financiers will disagree with me, you cannot really invest if you are borrowing money. Keep debt to zero or just on a primary residence. I can tell you from personal experience that I did not started building wealth until I made a firm commitment to being out of debt. Buy cars for cash and never pay credit card interest. Pay off student loans as soon as possible. For some reason the idea of giving to charity invokes rancor. A cursory study of millionaires will indicate some surprising facts: most of them are self made, most of them behave differently than pop culture, and among other things most of them are generous givers. Building wealth is about behavior. Giving to charity is part of that behavior. Its my own theory that giving does almost no good for the recipient, but a great amount of good for the giver. This may seem difficult to believe, but I ask that you try it.\"" }, { "docid": "409573", "title": "", "text": "A financial institution is not obligated to offer you a loan. They will only offer you a loan if they believe that they will make money off you. They use all the info available in order to determine if offering you a loan is profitable. In short, whether they offer you a loan, and the interest rate they charge for that loan, is based on a few things: How much does it cost the bank to borrow money? [aka: how much does the bank need to pay people who have savings accounts with them?]; How much does the bank need to spend in order to administer the loan? [ie: the loan officer's time, a little time for the IT guy who helps around the office, office space they are renting in order to allow the transaction to take place]; and How many people will 'default' and never be able to repay their loan? [ex: if 1 out of 100 people default on their loans, then every one of those 100 loans needs to be charged an extra 1% in order to recover the money the bank will lose on the person who defaults]. What we are mostly interested in here is #3: how likely are you to default? The bank determines that by determining your income, your assets, your current debts outstanding, your past history with payments (also called a credit score), and specifically to mortgages, how much the house is worth. If you don't have a long credit history, and because you don't have a long income history, and because you are putting <10% down on the condo [20% is often a good % to strive for, and paying less than that can often imply you will need mandatory mortgage insurance, depending on jurisdiction] the bank is a little more uncertain about your likelihood to pay. Banks don't like uncertainty, and they can deal with that uncertainty in two ways: (1) They can charge you a higher interest rate; OR (2) They can refuse you the loan. Now just because one bank refuses you a loan, doesn't mean all will - but being refused by one bank is probably a good indication that many / most institutions would refuse you, because they all use very similar analytical tools to determine your 'risk level'. If you are refused a loan, you can try again at another institution, or you can wait, save a larger down payment, and build your credit history by faithfully paying your credit card every month, paying your utilities, and making your car and rent payments on time. This will give the banks more comfort that you will have the ability to pay your mortgage every month, and a larger down payment will give them comfort that if the housing market dips, you won't owe more than the house is worth. My parting shot is this: If you are new in your career with no income history, be very careful about buying a property immediately, even if you get approved. A good rule of thumb is to only buy a property when you plan on living there for at least 5 years, or else you are likely to lose money overall, after factoring closing costs and maintenance fees. If you are refused a loan, that's probably a good sign that you aren't financially ready yet, but even if a bank approves you for a loan, you might not be ready yet either." }, { "docid": "585288", "title": "", "text": "I also had a student loan and glad you are taking a good look on interest rate as it really makes a huge difference. One of the strategies I followed was since my credit improved as I stepped out of school. I took advantage of a good 0 percent credit card. I applied for discover and got a decent credit limit. There are 2 particular things you are looking for in a credit card in this situation Usually the initial $0 transaction charge is only for a couple of months so ensure you take advantage of that. What is the benefit: Imagine being able to pay off that higher interest rate balance with 0% and not have to worry about it immediately. That way you save on the interest you would be paying and stress as well Watch out for: Although you have to ensure that you do payoff the money you paid through the 0 percent credit card ( which may have been put off for a year or even 15 months or so) other wise you may have to pay it all at once as the offer is expiring. Note: for credit cards ensure to note when the 0% is expiring as that is usually not mentioned on the statement and you may have to call the customer service. I was in a similar situation and was able to pay it all off fairly quickly. I am sure you will as well." }, { "docid": "134063", "title": "", "text": "Plus you already have money in a 529 plan that is meant for college expenses (and cannot be used to pay student loans) - use that money for what it's for. I disagree with @DStanley, as a current college student I would say to take out loans. Most of the time I am against loans though. So WHY? There are very few times you will receive loans at 0% interest (for 4+ years). You have money saved currently, but you do not know what the future entails. If you expend all of your money on tuition and your car breaks down, what do you do? You can not used student loans to pay for your broken car.Student loans, as long as they are subsidized, serve as a wonderful risk buffer. You can pay off your loans with summer internships and retain the initial cash you had for additional activities that make college enjoyable, i.e - Fraternity/ Sorority, clubs, dinners, and social nights. Another benefit to taking these loans would assist in building credit, with an additional caveat being to get a credit card. In general, debt/loans/credit cards are non-beneficial. But, you have to establish debt to allow others to know that you can repay. Establishing this credit rating earlier than later is critical to cheaper interest rates on (say) a mortgage. You have made it through, you have watched your expenses, and you can pay your debt. Finish It. If you do it right, you will not have loans when you graduate, you will have a stunning credit rating, and you will have enjoyed college to its fullest potential (remember, you only really go through it once.) But this is contingent on: Good luck, EDIT: I did not realize the implication of this penalty which made me edit the line above to include: (to the extent you can per year) For now, student loan repayment isn't considered a qualified educational expense. This means that if you withdraw from a 529 to pay your debts, you may be subject to income taxes and penalties.Source Furthermore, Currently, taxpayers who use 529 plan money for anything other than qualified education expenses are subject to a 10% federal tax penalty. Source My advice with this new knowledge, save your 529 if you plan on continuing higher education at a more prestigious school. If you do not, use it later in your undergraduate years." }, { "docid": "257483", "title": "", "text": "\"First of all, congratulations on admitting your problem and on your determination to be debt-free. Recognizing your mistakes is a huge first step, and getting rid of your debt is a very worthwhile goal. When considering debt consolidation, there are really only two reasons to do so: Reason #1: To lower your monthly payment. If you are having trouble coming up with enough money to meet your monthly obligations, debt consolidation can lower your monthly payment by extending the time frame of the debt. The problem with this one is that it doesn't help you get out of debt faster. It actually makes it longer before you are out of debt and will increase the total amount of interest that you will pay to the banks before you are done. So I would not recommend debt consolidation for this reason unless you are truly struggling with your cashflow because your minimum monthly payments are too high. In your situation, it does not sound like you need to consolidate for this reason. Reason #2: To lower your interest rate. If your debt is at a very high rate, debt consolidation can lower your interest rate, which can reduce the time it will take to eliminate your debt. The consolidation loan you are considering is at a high interest rate on its own: 13.89%. Now, it is true that some of your debt is higher than that, but it looks like the majority of your debt is less than that rate. It doesn't sound to me that you will save a significant amount of money by consolidating in this loan. If you can obtain a better consolidation loan in the future, it might be worth considering. From your question, it looks like your reasoning for the consolidation loan is to close the credit card accounts as quickly as possible. I agree that you need to quit using the cards, but this can also be accomplished by destroying the cards. The consolidation loan is not needed for this. You also mentioned that you are considering adding $3,000 to your debt. I have to say that it doesn't make sense at all to me to add to your debt (especially at 13.89%) when your goal is to eliminate your debt. To answer your question explicitly, yes, the \"\"cash buffer\"\" from the loan is a very bad idea. Here is what I recommend: (This is based on this answer, but customized for you.) Cut up/destroy your credit cards. Today. You've already recognized that they are a problem for you. Cash, checks, and debit cards are what you need to use from now on. Start working from a monthly budget, assigning a job for every dollar that you have. This will allow you to decide what to spend your money on, rather than arriving at the end of the month with no idea where your money was lost. Budgeting software can make this task easier. (See this question for more information. Your first goal should be to put a small amount of money in a savings account, perhaps $1000 - $1500 total. This is the start of your emergency fund. This money will ensure that if something unexpected and urgent comes up, you won't be so cash poor that you need to borrow money again. Note: this money should only be touched in an actual emergency, and if spent, should be replenished as soon as possible. At the rate you are talking about, it should take you less than a month to do this. After you've got your small emergency fund in place, attack the debt as quickly and aggressively as possible. The order that you pay off your debts is not significant. (The optimal method is up for debate.) At the rate you suggested ($2,000 - 2,500 per month), you can be completely debt free in maybe 18 months. As you pay off those credit cards, completely close the accounts. Ignore the conventional wisdom that tells you to leave the unused credit card accounts open to try to preserve a few points on your credit score. Just close them. After you are completely debt free, take the money that you were throwing at your debt, and use it to build up your emergency fund until it is 3-6 months' worth of your expenses. That way, you'll be able to handle a small crisis without borrowing anything. If you need more help/motivation on becoming debt free and budgeting, I recommend the book The Total Money Makeover by Dave Ramsey.\"" }, { "docid": "471111", "title": "", "text": "\"&gt;Really? I kinda thought it had something to do with losing 2.6 million jobs in 2008. Now that's a lot of revenue gone! Oh also the bush tax cuts All the more reason to keep increase spending by 5-10% a year, right? How about we create an envionment that yields more jobs rather than increasing the taxes of those left? Because that worked so well for social security originally supported by 5-10 employees per 1 receiving benefits, now it's only supported by 2 employees per 1 receiving benefits-- ultra sustainable! &gt;So almost 10% of our deficit? I'd say that's a good start. 10% of our deficit, so 1/4th the amount of DEBT INTEREST we'll pay this year? A drop in the bucket either way. Spending is the real culprit. &gt;I do agree we spend way too much on the pentagon, but pretty sure that went up a lot without our two unfunded republican wars. And now we're in a half dozen active and secret conflicts; Afganistan, Pakistan, Syria, Libya, Eygpt. All the more reason for Obama to IMMEDIATELY remove us from those wars. But he hasn't he has expanded them. And our military costs keep going up. It's not about \"\"this isn't the right time to withdrawl\"\" it's about his corporate masters being the same as the Bush corporate masters telling him to continue. It's about oil/gas and the pipelines and projection of power that comes with it. Obama has continued and expanded the same policies as Bush, he cannot hide behind, \"\"Well Bush was worse\"\", he can't say that because it isnt true. Infact we're killing more peasants in other countries than ever before--- just with military industrial complex built drones. &gt;There's also the unfunded Bush Medicare prescription drug plan. Yep, that prevents the government from negotiating prices on prescriptions for a token $10 Billion rebate, but which will yield $10 Trillion in revenues over the next 15 years. Sounds like a great ROI while the costs of drugs is skyhigh in the US. So what did Obama do? He fed that industry another 30 million new customers without so much as any discount. The government purposely stays out of the negotiation of price. Why? Because the bill was written by insurance industry and healthcare industry executives like most bills are. Healthcare is nice, but its the COST of healthcare that is the issue. If the cost was more reasonable, you wouldnt even need insurance, but because they can charge $70 for a single pair of rubber gloves, when the market price on a BOX is $5-10 we can plainly see the cost of medical care in the US is bloated and we get much less than comparative countries. Obama is just like Bush, he has enriched the various industries. The only difference between bush and Obama are which industries are enriched. You'll notice I didn't mention enrichment of citizens because they are an afterthought. Obama only needs to SELL the program to citizens, he sold it we bought it. &gt;You can't seriously think putting those people back in charge will lead to good things. No I don't think republicans or people like Bush or Romney are necessarily good for us either. The thing I have a problem with is that people like you think Obama is any different. He's not, new president, same as the old president. New speech writer, new cabinet (stuffed with corporate cronies and former lobbyists), but business as usual and marching orders from corporate and private masters.\"" }, { "docid": "91926", "title": "", "text": "\"For the mortgage, you're confusing cause and effect. Loans like mortgages generally have a very simple principle behind them: at any given time, the interest charged at that time is the product of the amount still owing and the interest rate. So for example on a mortgage of $100,000, at an interest rate of 5%, the interest charged for the first year would be $5,000. If you pay the interest plus another $20,000 after the first year, then in the second year the interest charge would be $4,000. This view is a bit of an over-simplification, but it gets the basic point across. [In practice you would actually make payments through the year so the actual balance that interest is charged on would vary. Different mortgages would also treat compounding slightly differently, e.g. the interest might be added to the mortgage balance daily or monthly.] So, it's natural that the interest charged on a mortgage reduces year-by-year as you pay off some of the mortgage. Mortgages are typically setup to have constant payments over the life of the mortgage (an \"\"amortisation schedule\"\"), calculated so that by the end of the planned mortgage term, you'll have paid off all of the principal. It's a straightforward effect of the way that interest works in general that these schedules incorporate higher interest payments early on in the mortgage, because that's the time when you owe more money. If you go for a 15-year mortgage, each payment will involve you paying off significantly more principal each time than with a 30-year mortgage for the same balance - because with a 15-year mortgage, you need to hit 0 after 15 years, not 30. So since you pay off the principal faster, you naturally pay less interest even when you just compare the first 15 years. In your case what you're talking about is paying off the mortgage using the 30-year payments for the first 15 years, and then suddenly paying off the remaining principal with a lump sum. But when you do that, overall you're still paying off principal later than if it had been a 15-year mortgage to begin with, so you should be charged more interest, because what you've done is not the same as having a 15-year mortgage. You still will save the rest of the interest on the remaining 15 years of the term, unless there are pre-payment penalties. For the car loan I'm not sure what is happening. Perhaps it's the same situation and you just misunderstood how it was explained. Or maybe it's setup with significant pre-payment penalties so you genuinely don't save anything by paying early.\"" }, { "docid": "147163", "title": "", "text": "Personal finances are not intuitive for everyone, and it can be a challenge to know what to do when you haven't been taught. Congratulations on recognizing that you need to make a change. The first step that I would recommend is what you've already done: Assemble your bank statements so you can get an accurate picture of what money you currently have. Keep organized folders so you can find your bank statements when you need them. In addition to the bank statements for your checking and savings accounts, you also need to assess any debt that you have. Have you taken out any loans that need to be paid back? Do you have any credit card debt? Make a list of all your debts, and make sure that you have folders for these statements as well. Hopefully, you don't have any debts. But if you are like most people, you owe money to someone, and you may even owe more money than you currently have in your bank accounts. If you have debts, fixing this problem will be one of your goals. No matter what your debt is, you need to make sure that from now on, you don't spend more money than you take in as income. To do this, you need to make a budget. A budget is a plan for spending your money. To get started with a budget, make a list of all the income you will receive this month. Add it up, and write that amount at the top of a page. Next, you want to make a list of all the expenses you will have this month. Some of these expenses are more or less fixed: rent, utility bills, etc. Write those down first. Some of the expenses you have more control over, such as food and entertainment. Give yourself some money to spend on each of these. You may also have some larger expenses that will happen in the future, such as a tuition or insurance payment. Allocate some money to those, so that by the time that payment comes around, you will have saved enough to pay for those expenses. If you find that you don't have enough income to cover all of your expenses in a month, you need to either reduce your expenses somewhere or increase your income until your budget is at a point where you have money left over at the end of each month. After you've gotten to this point, the next step is figuring out what to do with that extra money left over. This is where your goals come into play. If you have debt, I recommend that one of your first goals is to eliminate that debt as fast as possible. If you have no money saved, you should make one of your goals saving some money as an emergency fund. See the question Oversimplify it for me: the correct order of investing for some ideas on what order you should place your goals. Doing the budget and tracking all of your spending on paper is possible, but many people find that using the right software to help you do this is much easier. I have written before on choosing budgeting software. All of the budgeting software packages I mentioned in that post are from the U.S., but many of them can successfully be used in Europe. YNAB, the program I use, even has an unofficial German users community that you might find useful. One of the things that budgeting software will help you with is the process of reconciling your bank statements. This is where you go through the bank statement each month and compare it to your own record of spending transactions in your budget. If there are any transactions that appear in the statement that you don't have recorded, you need to figure out why. Either it is an expense that you forgot to record, or it is a charge that you did not make. Record it if it is legitimate, or dispute the expense if it is fraudulent. For more information, look around at some of the questions tagged budget. I also recommend the book The Total Money Makeover by Dave Ramsey, which will provide more help in making a budget and getting out of debt." }, { "docid": "459724", "title": "", "text": "Danger. The affidavit is a legal document. Understand the risk of getting caught. If you are planning on using the condo to generate income the chances that you default on the loan are higher than an owner occupied property. That is why they demand more down payment (20%+) and charge a higher rate. The document isn't about making sure you spend 183+ nights a year in the property, it is making sure that it isn't a business, and you aren't letting a 3rd party live in the property. If you within the first year tell the mortgage company to send the bill to a new address, or you change how the property is insured, they will suspect that it is now a rental property. What can they do? Undo the loan; ask for penalty fee; limit your ability to get a mortgage in the future; or a percentage of the profits How likely is it? The exact penalty will be in the packet of documents you receive. It will depend on which government agency is involved in the loan, and the lenders plan to sell it on the secondary market. It can also depend on the program involved in the sale of the property. HUD and sister agencies lock out investors during the initial selling period, They don't want somebody to represent themselves as homeowner, but is actually an investor. Note: some local governments are interested not just in non-investors but in properties being occupied. Therefore they may offer tax discounts to residents living in their homes. Then they will be looking at the number of nights that you occupy the house in a year. If they detect that you aren't really a resident living in the house, that has tax penalties. Suggestion: If you don't want to wait a year buy the condo and let the loan officer know what your plan is. You will have to meet the down payment and interest rate requirements for an investment property. Your question implies that you will have enough money to pay the required 20% down payment. Then when you are ready buy the bigger house and move in. If you try and buy the condo with a non-investment loan you will have to wait a year. If you try and pay cash now, and then get a home equity loan later you will have to admit it is a rental. And still have to meet the investor requirements." }, { "docid": "402325", "title": "", "text": "\"&gt; So I asked this question in /r/DebateaCommunist and got some interesting answers, mostly about how banks exist to make money out of nowhere and to fool people. What do yall have to say? That isn't what they said. Nobody mentioned fooling people from what I can see from a cursory glance. And if they did, they're being facetious. Also, they didn't mean \"\"make money from thin air\"\" in the sense of it being a magical trick. They make money from a sort of market inefficiency: they broker between people who want to invest money and those who want to borrow it. The top two answers are about right: a bank borrows money from investors (who deposit money in checking and savings accounts), and lends it to borrowers in the form of loans or mortgages. The difference between the interest rates is their profit. You deposit $1000 with me at 2% for 20 years. I give you $1485.95 at the end of that term. Where did I get the extra five hundred books? Well I lent it out in mortgages over the same terms at 6% and received $3207.14 over the same period of time. Your $1000 made you $485.95, and made me $1721.19 which I keep for the purposes of providing you with ATMs, dealing with bad debts and staffing the place. Simple, eh? Of course, they also provide other services in addition to this, and the way in which they do it is regulated, but that's all a bank is at its core. A central bank is slightly different: they issue money (i.e. \"\"print\"\" it), and supply it at a headline interest rate to the commercial banks. And of course banks borrow amongst themselves. But then we get ourselves down the rabbit hole of \"\"grown up\"\" economics and LIBOR and the like... there are whole textbooks used to explain exactly how that mechanism works and what's going on there. But if you want to get rich, find a way to start a bank. Seriously. Doing it to the old school way is seriously profitable if you can be trusted.\"" }, { "docid": "462036", "title": "", "text": "\"This may be a bit advanced now, but once you start really working and get a place, I think this will apply more... Do I set up a bank account now? Yes. There is no reason not to. As an adult you will be using this much more than you think. Assuming you have a little money, you can walk in to any bank almost any day of the week and set up an account with them in very little time. Note that they may require you to be 18 if your parents won't be with you on the account. Otherwise, just ask any bank representative to help you do this. Just to be clear, if you can get a credit union account over a typical bank account, this is a great idea. Credit unions provide exactly the same financial services as a normal bank, but typically have variety of advantages over banks. Bank Account Parts Bank accounts typically have two parts, a checking account and a savings account. Your checking account typically is what you use for most day-to-day transactions and your savings account is generally used for, well, saving money. Having a bank account often gives you the following advantages: They give you an ability to store money without having large amounts of cash on hand. Once you start working regularly, you'll find you won't want to keep ~$600+ cash every two weeks in your wallet or apartment. They help you pay bills. When you set up your bank account, you will likely be able to get a Visa debit card which will process like a regular credit card but simply deduct funds from your checking account. You can use this card online to pay utilities (i.e. electricity and water), general bills (e.g. your cell phone and cable), purchase items (ex. at Amazon) or use it in stores to pay in lieu of cash. Be aware -- some banks will give you an ATM-only card before they send you the Visa debit card in the mail. This ATM-only card can only be used at ATMs as it's name implies. Similarly, if you can invest about ~$200 to build your credit, you can often get a deposit secured credit card attached to your account (basically a credit card where the bank keeps your money in case you can't pay your bill). If you treat this card with responsibility, you can eventually transition to an unsecured credit card. They save you hassles when cashing your check. If you don't have a bank where you can cash your check (e.g. you don't have an account), you will likely be charged check cashing fees (usually by places such as grocery stores or payday loan chains, or even other banks). Furthermore, if your check is over a certain amount, some places may refuse to cash your check period and a bank may be your only option. They give you a way to receive money electronically. The most common example of this is direct deposit. Many employers will send your money directly to your bank account instead of requiring you to cash a check. If they are prompt, this money gets to you faster and saves you trouble (on payday, you'll just receive a pay stub detailing your wages and the amount deposited rather than a check). Also, since you asked about taxes, you should know that when you do eventually file with the IRS, they have an option to receive your tax refund electronically as well (e.g. direct deposit into your bank account) and that can literally save you months in some cases depending on when you file your return and how many paper checks they have to process. Does it cost money to setup? It depends. Some banks have special offers, some don't. Most places will set up an account for free, but may require a minimum deposit to open the account (typically $50-$100). The Visa debit card mentioned above generally comes free. If you want a secured credit card as above, you will want about an additional $200 (so $250 - $300 total). Note that this is absolutely NOT required. You can exclusively use the Visa debit card above if you wish. Bank Account Fees Any fees charged when you have a bank account are usually minor anymore. Regardless, the bank will hand you a whole bunch of paperwork (mostly in legalese) detailing exactly how your account works. That said, the bank person helping set things up will cover what you need to know about keeping the account in plain English. The most common types of fee associated with a bank account are monthly maintenance fees and overdraft fees, but these aren't always necessarily charged. Likewise, there may be some other fees associated with the account but these vary from bank to bank. Monthly Maintenance Fees To give some examples... Overdraft Fees Overdraft fees are typically charged when you attempt to spend more money than you have in your bank account and the bank has to cover these charges. Overdraft fees typically apply to using paper checks (which it is unlikely you will be using), but not always. That said, it is very unlikely you will be charged overdraft fees for three reasons: Many banks have done away with these fees in lieu of other ways of generating revenue. Banks that still charge these fees usually have \"\"overdraft protection\"\" options for a little more money a month, effectively negating the possibility you will be charged these fees. The ability to deduct an amount of money from your checking account is now typically checked electronically before the payment is authorized. That is, using a Visa debit card, the card balance is checked immediately, and even when using paper check, most retailers have check scanning machines that do roughly the same thing. On a personal note, the bank that I have allows my account to be deducted below my checking account balance only if the payment is requested electronically (e.g. someone who has my card information charges me for a monthly service). In this case, the funds are simply listed in the negative and deducted from any amount I deposit till the proper amount is repaid (e.g. if I'm at -$25 dollars due to a charge when my account balance was $0 and then I deposit $100, my available balance will then be $75, not $100). Finally, per the comment by @Thebluefish, while I minimize the likelihood you will be charged overdraft fees, it is good to check into the exact circumstances under which you might be charged unexpectedly by your bank. Read the documentation they give you carefully, including any mailed updates, and you'll reduce the chance of receiving a nasty surprise. For reference, here are some of the fees charged by Bank of America. What about taxes? When you begin working, an employer will usually have you fill out a tax form such as a W-4 Employee's Withholding Allowance Certificate so that your employer can withhold the correct federal income tax from your wages. If they don't, then it is your responsibility to calculate and file your own income taxes (if you are self-employed, an independent contractor or paid under the table). If your employer is reputable, they will send you additional information (generally in February) you need to properly file your taxes prior to April 15th (the IRS tax deadline for most people). This additional information will likely be some variation of a W-2 Wage and Tax Statement or possibly a Form 1099-MISC. Do I have to worry about money in my bank account? Unless you have a significant amount in your bank savings account earning interest (see \"\"Should I save for the future?\"\" below), you won't have to pay any sort of tax on money in your bank account. If you do earn enough taxable interest, the bank will send you the proper forms to file your taxes. How do I file taxes? While it won't apply till next year, you will likely be able to fill out a Form 1040EZ Income Tax Return for Single and Joint Filers With No Dependents, as long as you don't have any kids in the meantime. ;-) You will either mail in the paper form (available at your local IRS office, post office, public library, etc.) or file electronically. There will be a lot of information on how to do this when the time comes, so don't worry about details just yet. Assuming your all paid up on your taxes (very likely unless you get a good paying job and take a lot of deductions throughout the year on your W-4), you'll probably get money back from the IRS when you file your tax return. As I mentioned above, if you have a bank account, you can opt to have your refund money returned electronically and get it much sooner than if you didn't have a bank account (again, possibly saving you literal months of waiting). Should I save for my future? If so, how much? Any good articles? Yes, you should save for the future, and start as soon as possible. It's outside the scope of this answer, but listen to your Economics professor talk about compound interest. In short, the later you start saving, the less money you have when you retire. Not that it makes much difference now, but you have to think that over 45 years of working (age 20-65), you likely have to have enough money for another 20+ years of not working (65-85+). So if you want $25,000 a year for retirement, you need to make ~$50,000 - $75,000 a year between your job and any financial instruments you have (savings account, stocks, bonds, CDs, mutual funds, IRAs, job retirement benefits, etc.) Where you should stick money your money is a complicated question which you can investigate at length as you get older. Personally, though, I would recommend some combination of IRA (Individual Retirement Account), long term mutual funds, and some sort of savings bonds. There is a metric ton of information regarding financial planning, but you can always read something like Investing For Dummies or you can try the Motley Fool's How To Invest (online and highly recommended). But I'm Only 17... So what should you do now? Budget. Sounds dumb, but just look at your basic expenses and total them all up (rent, utilities, phone, cable, food, gas, other costs) and divide by two. Out of each paycheck, this is how much money you need to save not to go into debt. Try to save a little each month. $50 - $100 a month is a good starting amount if you can swing it. You can always try to save more later. Invest early. You may not get great returns, but you don't need much money to start investing. Often you can get started with as little as $20 - $100. You'll have to do research but it is possible. Put money in your savings account. Checking accounts do not typically earn interest but money in savings accounts often do (that is, the bank will actually add money to your savings assuming you leave it in there long enough). Unfortunately, this rate of interest is only about 3.5% on average, which for most people means they don't get rich off it. You have to have a significant amount of money ($5,000+) to see even modest improvements in your savings account balance each month. But still, you may eventually get there. Get into the habit of putting money places that make you money in the long run. Don't go into debt. Don't get payday loans, pawn items, or abuse credit cards. Besides wrecking your credit, even a small amount of debt ($500+) can be very hard to break out of if you don't have a great paying job and can even make you homeless (no rent means no apartment). Remember, be financially responsible -- but assuming your parents aren't totally tight with money, don't be afraid to ask for cash when you really need it. This is a much better option than borrowing from some place that charges outrageous interest or making your payments late. Have an emergency account. As already mentioned in another excellent answer, you need to have money to \"\"smooth things out\"\" when you encounter unexpected events (your employer has trouble with your check, you have to pay for some sort of repair bill, you use more gas in your car in a month than normal, etc.) Anywhere from $200 - $2000+ should do it, but ideally you should have at least enough to cover a month of basic expenses. Build good credit. Avoid the temptation to get a lot of credit cards, even if stores and banks are dying to give them to you. You really only need one to build good credit (preferably a secured one from your bank, as mentioned above). Never charge more than you can pay off in a single month. Charging, then paying that amount off before the due date on your next statement, will help your credit immensely. Likewise, pay attention to your rent, utilities and monthly services (cell phone, cable, etc.). Even though these seem like options you can put off (\"\"Oh my electric bill is only $40? I'll pay that next month...\"\") late payments on all of these can negatively affect your credit score, which you will need later to get good loans and buy a house. Get health insurance. Now that the Affordable Care Act (ACA a.k.a Obamacare) has been enacted, it is now simpler to get health insurance, and it is actually required you have some. Hopefully, your employer will offer health coverage, you can find reasonably priced coverage on your own, or you live in a state with a health exchange. Even if you can't otherwise get/afford insurance, you may qualify for some sort of state coverage depending on income. If you don't have some sort of health insurance (private or otherwise), the IRS can potentially fine you when you file your taxes. Not to be too scary, but the fine as currently proposed is jumping up to about $700 for individuals in 2016 or so. So... even if you don't grab health insurance (which you absolutely should), you need to save about $60 a month, even if just for the fine. This answer turned out a bit longer than intended, but hopefully it will help you a little bit. Welcome to the wonderful world of adult financial responsibility. :-)\"" }, { "docid": "327441", "title": "", "text": "\"Bankruptcy should be your last option, and you will find that BK will not resolve most of your problems, and create many more problems. There are two kinds of BK that are available to the average person, Ch13 debt repayment and Ch7 liquidation. Both have severe repercussions and lasting effects on your credit (7-10 years, after discharge). And the calculations required under the 2005 BAPCPA are complex and may require help to understand. Ch7 liquidation is the more severe course, and the trustee would liquidate assets that exceed exemptions (vary by state) to pay your creditors. Ch13 debt repayment is hard, and only 20-25% of those who pursue that route complete the debt repayment plan. Your credit score for either course would suffer greatly (200-250 points) and would remain reduced for years, especially since you would have to rebuild credit. And the law is flawed both in design and execution as there is no reward for successful debt repayment, few finish their repayment plan (20-25%), the mean recovery for unsecured creditors in repayment is zero (thus does not help creditors), and leaves the debtor with damaged credit for years (not a fresh start). Although you may have made some decisions that have placed you in a difficult position, you can find solutions to resolve these problems. You may find that simply learning to make better choices will improve your situation. Take a financial education course (such as the Dave Ramsey course), and learn how to budget, and make better choices. The LearnVest website offers a simple way to budget by dividing budgeting into only three (3) categories with suggested percentages for each, essentials (<50%), financial priorities (>20%), and lifestyle (<30%). The damage to your credit from the derogatory effects of BK would linger for years, but the damage from poor payment history declines much quicker, and loses most of the effect after 2 years (and should you keep the accounts open, leaves you with good history and longer account history), thus the effects decline to minimal after as little as 2 years of good behavior/payment history. Make a plan that prioritizes the debts, and how you will resolve the problem, and work the plan. Based upon the income and debts you mention, the situation you have may not be as bad as it appears. You may be getting bad advice, especially from a debt settlement company that might be more interested in their fees than in your problem. Since you \"\"want to play fair and continue with payments, but when people start to get greedy like this I am ready to just stop caring\"\", you really need two things, a plan, and a friend, someone who you can talk to honestly and openly, and who can support you as you work through the plan you make. Since you \"\"would prefer the option that will give me the most peace of mind and allow me to start saving money as soon as possible\"\", you need to find an approach that fits your goals. Your statement that you \"\"don't plan on ever using credit again\"\", fits with the Dave Ramsey philosophy and resonates with many of us who have learned that those who grant credit are often harsh masters. Now that you have provided more information, the advice below expands upon the above reflecting upon your specific situation. Since you make $62K/year, you may be close to the median income, and the BAPCPA (Bankruptcy Abuse Prevention and Consumer Protection Act of 2005) has a presumption of abuse for filing Ch7 when you have above median income (for your state, check the law). As you may be pushed into Ch13 debt repayment anyway, examine what you could do to repay the debt (over 5 years, 60 months, as that would be a Ch13 repayment duration). Since you have $8K of revolving (unsecured?) debt, that would be repaid in Ch13 over 60 months at about $133/month (no interest), but you would also be paying 10% to the trustee. There might be some portion of your auto debt which is unsecured, and also be repaid unsecured, suppose that is $3000. That would add another $50/month to the plan. The car could be repaid over 60 months (including interest), so you might be repaying $300/month for the car (estimate), although the payment could be higher or lower depending upon how much of the value of the car is unsecured. The trustee might object that the car is too expensive (depends upon the value, and the trustee), and require be liquidated. Since BK excludes relief for student loans, you might find yourself paying the student loans at the same payment. Your $62K income suggests that you have about $4200/month (guess, after taxes). The mortgage payment is higher than 25% ($1050-1100 would be ideal for your income). But after your mortgage payment you should still have about $3900. Even with $300 for credit card debt, $500 for car, and $400 for student loans (guessing), that leaves $2700 for essentials (utilities, food), lifestyle (cellphone, entertainment), and savings. You might find a friend who is good at budgeting who would be willing to help you craft a budget and be your \"\"responsibility partner\"\" to help you stick to the budget. Here is a sample plan (your mileage may vary), Essentials (50%, $2100): $2180 Financial (30%, 1230): $1250 Lifestyle (20%, 840): $500 (pick up slack here, as you have high debt load)\"" }, { "docid": "151506", "title": "", "text": "Remember that if you make charges as the starting of your billing cycle, then you are receiving a free ~60-day loan. For those that are able to receive high interest rates on their, this means a greater opportunity to earn on their money. For example: Your billing statement ends on Jan 5th. On Jan 6th, you max out your credit card. Your billing statement ends on Feb 5th. Depending on your credit card, your grace period can be anywhere from 20 to 30 days. If your bill is due Mar 7th, you just gave yourself a free 60 day loan. If you have multiple credit cards with different due dates and long grace periods, you can rotate which cards you max out to optimize the money you keep in savings." } ]

[ { "docid": "541705", "title": "", "text": "I'm not a tax expert, but I think you mean Form 4562, right? If you acquire the laptop in the year for which you're filing taxes, then it is just that simple. (At least according to my reading of 4562 instructions, and my history of accepted tax returns where I've done this for my own business.) If, however, you acquired the laptop in a previous year and have already depreciated it previously (with the plan to spread over several years), there is more complexity I believe -- you may limited in how you could accelerate the remaining depreciation." } ]

[ { "docid": "238964", "title": "", "text": "huh? the Volker Rule is straight up repealed, in full. &gt;TITLE IX—REPEAL OF THE VOLCKER RULE AND OTHER PROVISIONS &gt;SEC. 901. REPEALS. &gt;(a) In General.—The following sections of title VI of the Dodd-Frank Wall Street Reform and Consumer Protection Act are repealed, and the provisions of law amended or repealed by such sections are restored or revived as if such sections had not been enacted: &gt;(1) Section 603. &gt;(2) Section 618. &gt;(3) Section 619. &gt;(4) Section 620. &gt;(5) Section 621. &gt;(b) Clerical Amendment.—The table of contents under section 1(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act is amended by striking the items relating to sections 603, 618, 619, 620, and 621." }, { "docid": "354010", "title": "", "text": "Centre For Laptops offer very reliable laptop services for all types of brands of laptops and computers by the trained personnel. Centre For Laptops provides best DELL Laptop Repair And Services In Delhi. Centre For Laptops use the latest methods of diagnosing to find the hardware and software issues. For more details, Visit: http://centreforlaptops.com/" }, { "docid": "184210", "title": "", "text": "Insurance is for events that are both and Unexpected and, for many people, catastrophic events are, for example, sickness, disability, death, car accidents, house fires, and burglaries, for which you may buy health, disability, life, auto, home, and renter's insurance. It may be catastrophic for a family relying on a very old earner for that earner to die, and you can buy life insurance up to a very old age, but the premiums will reflect the likelihood of someone of that age dying within the covered period. The more expected an event is, the more anything referred to as insurance is actually forced savings. Health insurance with no copays on regular checkups expects the insured to use them, so the cost of those checkups plus a profit for the insurance company is factored into the premiums ahead of time. A wooden pencil breaking may be unexpected. Regardless of foreseeability, no one buys insurance on wooden pencils, as the loss of a pencil is not catastrophic. What is catastrophic can be context dependent. Health-care needs are typically unforeseeable, as you don't know when you'll get sick. For a billionaire, needing health-care, while unforeseeable, the situation would not be catastrophic, and the billionaire can easily self-insure his or her health to the same extent as most caps offered by health insurance companies. If you're on a fixed budget buying a laptop, if it unexpectedly failed, that would be catastrophic to you, so budgeting in the cost of insurance or an extended warranty while buying your laptop would probably make sense. Especially if you need that $2000 laptop, spending an extra 17.5% would safeguard against you having to come out of pocket and depleting your savings to replace it, even though that brings you to a grand total of $2350 before taxes. However, if you're in that tight of a situation, I would strongly recommend you to find a less expensive option that would allow you to self-insure. If you found a used laptop for much less (I can even see Apple selling refurbished Macs for less than $1000) you might decide that your budget allows you to self-insure, and you could profit from being careful with your hardware and resolving to cover any issues with it yourself." }, { "docid": "175027", "title": "", "text": "Laptop Screen--Laptoplcdscreenstore.com is a world recognized laptop screen store where you can purchase laptop screen of popular brands such as Dell, Acer, Compaq, LENOVO, Asus and many more. Providing an unmatchable quality at unbeatable prices, the store offers special deals on selected laptop LCD screens exclusively for you." }, { "docid": "457547", "title": "", "text": "Sorry, this post is horribly misguided. First of all, any boat or yacht is a terrible investment. The depreciation is horrendous. Secondly saying you lease as otherwise you’re tying up capital stupidly is incorrect. It depends on what your marginal cost of capital vs that of companies leasing. When you lease you also compensate the lessor for its cost of capital. If your cost of capital is less than that of the lessor then you would be stupid to get the lease. You would be better off paying the 250mln out of pocket and borrowing it from the market yourself." }, { "docid": "256728", "title": "", "text": "Laptop LCD Screen--Laptoplcdscreenstore.com is a world recognized laptop screen store where you can purchase laptop screen of popular brands such as Dell, Acer, Compaq, LENOVO, Asus and many more. Providing an unmatchable quality at unbeatable prices, the store offers special deals on selected laptop LCD screens exclusively for you." }, { "docid": "295093", "title": "", "text": "Either way, (lease or buy), it's likely going to be an expense, not a depreciation. You would expense the entire lease amount - whatever that is in the year it was paid. A $2k-$3k computer probably isn't worth the trouble of recording it as a Fixed Asset and depreciating it yearly. I work for a company that buys thousands of PCs a year for its employees and we have a hard rule: If it's under $3k, it's an expense not an asset. If you were buying $20k-$50k servers, this would be a different conversation both because of the price and the life of the item. Because it's such a small amount (unless you really are buying $20k PCs), it doesn't really matter whether it's your biggest expense or not, it's likely just an expense. Though, no one is preventing you from depreciating it over 5 years if you wanted to. See: https://www.irs.gov/help-resources/tools-faqs/faqs-for-individuals/frequently-asked-tax-questions-answers/sale-or-trade-of-business-depreciation-rentals/depreciation-recapture/depreciation-recapture In summary: I would say your question is more of a business sense question than a tax question. Is it worth it to you to lease instead of buying because you are getting a new PC so often? Btw: every 2 years is not that often. It's average. Whatever your decision, I think the answer for taxes is the same: Expense it all in the year it was incurred unless you really want to spread it out and depreciate." }, { "docid": "393629", "title": "", "text": "Should I treat this house as a second home or a rental property on my 2015 taxes? If it was not rented out or available for rent then you could treat it as your second home. But if it was available for rent (i.e.: you started advertising, you hired a property manager, or made any other step towards renting it out), but you just didn't happen to find a tenant yet - then you cannot. So it depends on the facts and circumstances. I've read that if I treat this house as a rental property, then the renovation cost is a capital expenditure that I can claim on my taxes by depreciating it over 28 years. That is correct. 27.5 years, to be exact. I've also read that if I treat this house as a personal second home, then I cannot do that because the renovation costs are considered non-deductible personal expenses. That is not correct. In fact, in both cases the treatment is the same. Renovation costs are added to your basis. In case of rental, you get to depreciate the house. Since renovations are considered part of the house, you get to depreciate them too. In case of a personal use property, you cannot depreciate. But the renovation costs still get added to the basis. These are not expenses. But does mortgage interest get deducted against my total income or only my rental income? If it is a personal use second home - you get to deduct the mortgage interest up to a limit on your Schedule A. Depending on your other deductions, you may or may not have a tax benefit. If it is a rental - the interest is deducted from the rental income only on your Schedule E. However, there's no limit (although some may be deferred if the deduction is more than the income) if you're renting at fair market value. Any guidance would be much appreciated! Here's the guidance: if it is a rental - treat it as a rental. Otherwise - don't." }, { "docid": "594011", "title": "", "text": "\"Straight Line Depreciation is the easiest method of depreciation, don't over think it. Straight Line = (Assets Cost - Assets Salvage Value)/Useful life In this case the Straight Line is $2m per year, it is not culmulative unless you are looking at accumulated depreciation account on the balance sheet. Here is a schedule of the depreciation: * Year 1 - $2m * Year 2 - $2m * Year 3 - $2m * Year 4 - $2m * Year 5 - $2m See, can't get much easier than that! Once you get into more complicated questions they'll throw tax rates at you and ask about cash flows, or the NPV of the cash flows. You need to take into account the fact that the Depreciation is not a \"\"cash expense\"\" but it does affect cash flow by reducing the taxable income of the project. Also, you need to consider the fact that the asset will be sold in year 5 and the value will need to be part of your cash flow and NPV calculations. I hope this was helpful, if not I'll try to do my best answering any other questions. Good Luck!\"" }, { "docid": "276927", "title": "", "text": "\"First, don't use Yahoo's mangling of the XBRL data to do financial analysis. Get it from the horse's mouth: http://www.sec.gov/edgar/searchedgar/companysearch.html Search for Facebook, select the latest 10-Q, and look at the income statement on pg. 6 (helpfully linked in the table of contents). This is what humans do. When you do this, you see that Yahoo omitted FB's (admittedly trivial) interest expense. I've seen much worse errors. If you're trying to scrape Yahoo... well do what you must. You'll do better getting the XBRL data straight from EDGAR and mangling it yourself, but there's a learning curve, and if you're trying to compare lots of companies there's a problem of mapping everybody to a common chart of accounts. Second, assuming you're not using FCF as a valuation metric (which has got some problems)... you don't want to exclude interest expense from the calculation of free cash flow. This becomes significant for heavily indebted firms. You might as well just start from net income and adjust from there... which, as it happens, is exactly the approach taken by the normal \"\"indirect\"\" form of the statement of cash flows. That's what this statement is for. Essentially you want to take cash flow from operations and subtract capital expenditures (from the cash flow from investments section). It's not an encouraging sign that Yahoo's lines on the cash flow statement don't sum to the totals. As far as definitions go... working capital is not assets - liabilities, it is current assets - current liabilities. Furthermore, you want to calculate changes in working capital, i.e. the difference in net current assets from the previous quarter. What you're doing here is subtracting the company's accumulated equity capital from a single quarter's operating results, which is why you're getting an insane result that in no way resembles what appears in the statement of cash flows. Also you seem to be using the numbers for the wrong quarter - 2014q4 instead of 2015q3. I can't figure out where you're getting your depreciation number from, but the statement of cash flows shows they booked $486M in depreciation for 2015q3; your number is high. FB doesn't have negative FCF.\"" }, { "docid": "88972", "title": "", "text": "\"The key with analyzing financial statements is that you need to look at all angles of a particular item. ie: Sales has gone up, but has the cost of sales increased by even more, implying narrower margins? Or, interest expense has gone up, but is that because new debt was taken on to pay for expansion? In the specific case you mentioned [buying assets that will create depreciation expense over time], there is a grouping on the cash flow statement called 'Investing', which will state the amount of cash used during the year to invest in the business. This could be a good thing or a bad thing, depending on other factors (and your personal preference regarding dividends being paid to shareholders). In addition, you can see the amount of depreciation expense separately listed on the cash flow statement. This tells you many things. Consider a company with $10M in assets on the balance sheet, but $2M in depreciation expense. This tells you that [in a very loose sense], every 5 years the assets owned by the company will all need to be replaced. Compare that with the Investing section of the cash flow statement - if they are buying $4M of new assets this year, this tells you that on an overall basis, they are likely expanding the business, because the new investments outpace the depreciation. But, is your concern of under-reported earnings a common issue? Typically, keep in mind that the most common bias of a company is to over-report earnings. This is because management compensation (in the form of performance bonuses and stock option valuation) is increased by profitable years. However, in a year where a loss / poor performance is likely, a reverse-bias occurs, to take as much of a loss as possible in that year. This is because if a manager's bonus is already 0 due to poor company performance, having a worse year will not turn the bonus negative. So, by taking all expenses possible today on the financial statements, next year might have less allocated expenses, and therefore the manager might get a bigger bonus impact next year. This is called \"\"Taking a big bath\"\". Note that public companies must meet certain reporting standards, and they are audited by external accounting firms to show that they meet those standards. Of course, there is no guarantee that the auditors will catch all cases of accounting manipulation (see Enron, etc., etc.).\"" }, { "docid": "35414", "title": "", "text": "My favorite part: Any bank with a leverage ratio greater than 10% can elect to be exempt from: &gt;(1) Any Federal law, rule, or regulation addressing capital or liquidity requirements or standards. &gt;(2) Any Federal law, rule, or regulation that permits an appropriate Federal banking agency to object to a capital distribution. &gt;(3) Any consideration by an appropriate Federal banking agency of the following: &gt;(A) Any risk the qualifying banking organization may pose to “the stability of the financial system of the United States”, under section 5(c)(2) of the Bank Holding Company Act of 1956. &gt;(B) The “extent to which a proposed acquisition, merger, or consolidation would result in greater or more concentrated risks to the stability of the United States banking or financial system”, under section 3(c)(7) of the Bank Holding Company Act of 1956, so long as the banking organization, after such proposed acquisition, merger, or consolidation, would maintain a quarterly leverage ratio of at least 10 percent. &gt;(C) Whether the performance of an activity by the banking organization could possibly pose a “risk to the stability of the United States banking or financial system”, under section 4(j)(2)(A) of the Bank Holding Company Act of 1956. &gt;(D) Whether the acquisition of control of shares of a company engaged in an activity described in section 4(j)(1)(A) of the Bank Holding Company Act of 1956 could possibly pose a “risk to the stability of the United States banking or financial system”, under section 4(j)(2)(A) of the Bank Holding Company Act of 1956, so long as the banking organization, after acquiring control of such company, would maintain a quarterly leverage ratio of at least 10 percent. &gt;(E) Whether a merger would pose a “risk to the stability of the United States banking or financial system”, under section 18(c)(5) of the Federal Deposit Insurance Act, so long as the banking organization, after such proposed merger, would maintain a quarterly leverage ratio of at least 10 percent. &gt;(F) Any risk the qualifying banking organization may pose to “the stability of the financial system of the United States”, under section 10(b)(4) of the Home Owners' Loan Act. &gt;(4) Subsections (i)(8) and (k)(6)(B)(ii) of section 4 and section 14 of the Bank Holding Company Act of 1956. &gt;(5) Section 18(c)(13) of the Federal Deposit Insurance Act. &gt;(6) Section 163 of the Financial Stability Act of 2010. &gt;(7) Section 10(e)(2)(E) of the Home Owners’ Loan Act. &gt;(8) Any Federal law, rule, or regulation implementing standards of the type provided for in subsections (b), (c), (d), (e), (g), (h), (i), and (j) of section 165 of the Financial Stability Act of 2010. &gt;(9) Any Federal law, rule, or regulation providing limitations on mergers, consolidations, or acquisitions of assets or control, to the extent such limitations relate to capital or liquidity standards or concentrations of deposits or assets, so long as the banking organization, after such proposed merger, consolidation, or acquisition, would maintain a quarterly leverage ratio of at least 10 percent. yeah, what could go wrong?" }, { "docid": "585241", "title": "", "text": "There are several factors here. Firstly, there's opportunity cost, i.e. what you would get with the money elsewhere. If you have higher interest opportunities (investing, paying down debt) elsewhere, you could be paying that down instead. There's also domino effects: by reducing your liquid savings to or below the minimum, you can't move any of it into tax advantaged retirement accounts earning higher interest. Then there's the insurance costs. You are required to buy extra insurance to protect your lender. You should factor in the extra insurance you would buy vs the insurance required. Given that you can buy the car yourself, catastrophic insurance may not be necessary, or you may prefer a higher deductible than your lender will allow. If you're not sufficiently capitalized, you may need gap insurance to cover when your car depreciates faster than your loan is paid down. A 30 percent payment should be enough to not need it though. Finally, there's some value in having options. If you have the loan and the cash, you can likely pay it off without penalty. But it will be harder to get the loan if you don't finance it. Maybe you can take out a loan against the car later, but I haven't looked into the fees that might incur. If it's any help, I'm in the last stretch of a 3 year car loan. At the time paying in cash wasn't an option, and having done it I recognize that it's more complicated than it seems." }, { "docid": "494832", "title": "", "text": "\"With regard to worries about ownership: I'll point you towards this - The Cohabitants Rights Bill currently in First Reading at the House of Lords. Without a date for even the second reading yet. In short the Bill is attempting to redress is the lack of rights when a non-married relationship ends when compared to married relationships; that is that one of the \"\"cohabitants\"\" can end up with basically nothing that they don't have their name on. So currently you're in the clear and (Part 2) Section 6.2.a says the Bill cannot be used retroactively against you if your relationship is over before it becomes law (I expect with Brexit etc, this Bill isn't a high priority - it's been a year since the first reading). Section 6.2.a: This Part does not apply to former cohabitants where the former cohabitants have ceased living together as a couple before the commencement date; However, if you're still together if/when this Bill becomes Law then basically all of (Part 1) Section 2 may be relevant as it notes the conditions you will fall into this bill: Section 2.1.a: live together as a couple and Section 2.2.d: have lived together as a couple for a continuous period of three years or more. and the \"\"have lived together\"\" at that point counts from the start of your cohabitation, not the start of the Bill being law: Section 2.4.a: For the purposes of subsection (2)(d), in determining the length of the continuous period during which two people have lived together as a couple - any period of the relationship that fell before the commencement date (of the Bill) is to be taken into account If you have kids at some point, you'd also fall under 2.2.a through 2.2.c too. After that, the financial parity decided upon by the court depends on a whole bunch of conditions as outlined in the Bill, but Section 8.1.b is pretty clear: Section 8.1.b: (b)the court is satisfied either— (i)that the respondent has retained a benefit; or (ii)40that the applicant has an economic disadvantage, as a result of qualifying contributions the applicant has made I'm not qualified to say whether your partner helping to pay off your mortgage in lieu of paying rent herself would count as just paying rent or giving you an economic benefit. Sections 12, 13, and 14 discuss opt-outs, also worth a read. The a major disclaimer here in that Bills at this early stage have the potential to be modified, scrapped and/or replaced making this info incorrect. As an additional read, here's an FT article from Feb 2016 discussing this lack of rights of a cohabitant which should alleviate any current concerns.\"" }, { "docid": "171763", "title": "", "text": "Does MS have Android and iPhone apps? I think they can reach customers just fine. &gt; The enormous success of the Chrome browser means that Chrome OS may yet achieve a similar kind of success. Chrome OS feels like a bargain basement desktop. It's ill-fitted to both tablets and more traditional computing. In its niche - smarphone-cored laptops - it's servicable, but that niche is small, and has Microsoft as competition on low-end x86 core laptops. Chrome OS, in my opinion, will get about the same level of success as OS-X, except without the high-ticket hardware helping to justify ever-widening per-unit profit margins (a situation that isn't likely sustainable either). Of course, I may be ivory-towering here from my Ubuntu-powered laptop." }, { "docid": "9731", "title": "", "text": "5 reasons why should you buy HP laptops 1. First of all it is one of the best laptop manufacturer company, who provide all types of laptops for their customers. 2. You can buy easily from any store, but online it might be afforded with genuine guarantee. 3. It is compatible it gives you latest HP LAPTOP processor up to core i7 within reasonable prices and latest operating system. 4. You can buy all types of laptops from our online store which is Dubai, UAE based company, we are online seller and deals in all types of products. 5. At our online store we sell you Hp laptops within at lowest range." }, { "docid": "280699", "title": "", "text": "They represent two distict payment processing mechanisms that just happen to be available on one product. Rather like having dvi and hdmi on you laptop. Your account number and sort code relates to the bank account. Your long number, expiry and ccv relate to the card. It is perfectly possible and not uncommon to have two different cards on the same account, which would have their own card numbers etc. The BACS, CHAPS, DirectDebit and FasterPayments systems use the account numbers. These transactions are practically irreversible and work through the interbank transfer system and should be considered 'direct money transfers' - electronic cash. The long digits are used by Mastercard, Visa, AmEx etc and go through their own payment systems. These payments are 'indirect' and may or may not be reversible as the private payment network (visa etc) has some accountability. They work like electronic cheques. This is why debit card transactions can cause you to go overdrawn - you are writing a promise to pay from an account. It is up to the bank to block the card if you have no money, vs a CHAPS payment that checks the money is there before moving it. It is easier (but still hard) to recover money lost through Visa fraud than BACS. Credit cards have only the long number etc. While savings accounts (non-checking accounts) have only account numbers. Depending on where you are different laws will likely cover debit card vs money transfer payments. In the UK Direct debit guarantee is the most common protection on the BACS system, while standing orders and faster payments give you little legal power. Debit cards will give you some protection because the payment system stands between you and the bank account, so if you didn't make the transaction you should be able to reclaim the money ('card not present fraud'). If you did make the transaction but the vendor failed to supply or goods were faulty then a Chargeback system exists where you may also be able to reclaim. A bank transfer you make is irrecoverable and refund can only be claimed through court for faulty goods." }, { "docid": "279824", "title": "", "text": "Not really. You just pay the other side of payroll taxes your employer typically pays. That's 7.65% more on your net. Not that much, all things considered. Plus, on part time Uber driving, the depreciation deduction on a car should exceed true depreciation costs. Putting 10K more miles on a car each year does not result in that much extra depreciation. 2010 Honda Civic DX Sedan 4D with 100K miles is worth $4,500 in Good condition, according to KBB. With 130K miles, it's worth $3,900. That's a difference of $600, or $0.02 per mile. You'll have more oil changes, brake replacements, gas, and other operating costs. But depreciation is small potatoes compared to the $0.535 in deductions per mile. Edit: If you would own a car regardless of whether or not you drive for Uber, Uber isn't a bad deal. It's a bad deal if you have to buy a car just to drive for Uber. It's all about the marginal cost of a mile." }, { "docid": "151810", "title": "", "text": "\"It's not quite as bad as the comments indicate. Form 1040ES has been available since January (and IME has been similarly for all past years). It mostly uses the prior year (currently 2016) as the basis, but it does have the updated (2017) figures for items that are automatically adjusted for inflation: bracket points (and thus filing threshhold), standard deductions, Social Security cap, and maybe another one or two I missed. The forms making up the actual return cannot be prepared very far in advance because, as commented, Congress frequently makes changes to tax law well after the year begins, and in some cases right up to Dec. 31. The IRS must start preparing forms and pubs -- and equally important, setting the specifications for software providers like Intuit (TurboTax) and H&RBlock -- several months ahead in order to not seriously delay filing season, and with it refunds, which nearly everyone in the country considers (at least publicly) to be worse than World War Three and the destruction of the Earth by rogue asteroids. I have 1040 series from the last 4 years still on my computer, and the download dates mostly range from late September to mid January. Although one outlier shows the range of possibility: 2013 form 1040 and Schedule A were tweaked in April 2014 because Congress passed a law allowing charitable contributions for Typhoon Haiyan to be deducted in the prior year. Substantive, but relatively minor, changes happen every year, including many that keep recurring like the special (pre-AGI) teacher supplies deduction (\"\"will they or won't they?\"\"), section 179 expensing (changes slightly almost every year), and formerly the IRA-direct-to-charity option (finally made permanent last year). As commented, the current Congress and President were elected on a platform with tax reform as an important element, and they are talking even more intensely than before about doing it, although whether they will actually do anything this year is still uncertain. However, if major reform is done it will almost certainly apply to future years only, and likely only start after a lag of some months to a year. They know it causes chaos for businesses and households alike to upend without advance warning the assumptions built in to current budgets and plans -- and IME as a political matter something that is enacted now and effective fairly soon but not now is just as good (but I think that part is offtopic).\"" } ]

[ { "docid": "59819", "title": "", "text": "The CPA's mention of $2,500 is probably referring to the recently increased de minimis safe harbor under the final tangible property regulations (used to be $500) without an applicable financial statement. The IRS will not challenge your choice of expense or capitalization on amounts on or below $2500 if you elect the de minimis safe harbor election on your return. However, you must follow whatever you're doing for your books. (So if you are capitalizing your laptops for book purposes, you would also need to capitalize for tax purposes). Section 179 allows you to expense property that you would have otherwise have had to capitalize and depreciate. Section 179 can be annoying, especially if your LLC is treated as a passthrough, because there are recapture provisions when you dispose of the asset too early. For the tax return preparer, it makes the return preparation much more simple if there are no fixed assets to account for in the first place, which is quite possible if you are expensive all items/invoices less than $2,500." } ]

[ { "docid": "2890", "title": "", "text": "\"MBS is a fairly general term \"\"Mortgage Backed Securities\"\" which simply means that the bond is collateralized with mortgages. Pass throughs are a type of MBS that is untranched: all bond holders of the deal are receiving the same interest and principal payments, there is no senior or subordinate class of bonds. Agency passthroughs bond holders receive any principal and interest payments paid by the loans in the pool, minus a slice of the interest payment that pays billing and insurance fees (servicing and guarantee fees, usually a .5% slice of the mortgage interest rate). On agency product (including Ginnies), if a loan defaults it will be bought out of the pool, with the bondholder receiving all of the expected principal and any interest due on the loan. Agency deals with different classes of bonds are usually called REMICs. Passthrough may also be split into principal-only (PO) and interest-only (IO) pieces. There is also a huge forward market in soon-to-be-issued passthroughs called the TBA market. Ginnie Mae has two slightly different programs referred to as Ginnie I and Ginnie II. Ginnie also has commercial and construction loan financial products. Freddie and Fannie have the same type of financial products as Ginnie, but there are differences in the sort of loans that Ginnie has vs the other agencies, as well as subtle minor differences between the contract terms of the securities. Ginnie is also more explicitly guaranteed by the federal government. You may want to look at: http://www.ginniemae.gov/index.asp (especially the \"\"For Investors\"\" and \"\"For Issuers\"\" sections.) Wikipedia's MBS may be more clear than my description: http://en.wikipedia.org/wiki/Mortgage-backed_security#Types\"" }, { "docid": "31144", "title": "", "text": "The regulations you're talking about (TR 1.263) are going into effect starting tax year 2016, so for purchases you made last year they're (kindof...) irrelevant. Kindof, because the IRS promises to not audit those that qualify under the regulations even if they use it before it goes into effect, but it doesn't legally have to. Since the regulations are new, I suggest you talk to a licensed professional who'd explain them to you and interpret them with regards to your specific situation. From my brief read, you can expense under these rules things that you would otherwise capitalize, with the $500 limit to the invoice. Meaning, if you bought a computer paying $500, which you use 50% for your business - you can expense $250. The benefit, comparing to the Sec. 179, is that you're not limited to new items, nor are you limited to business revenue. Otherwise, it looks like the applicability is similar. As I said - talk to a licensed tax adviser (EA/CPA licensed in your State), since these rules are new and untested, and you should probably have a professional provide guidance. I'm not such a professional." }, { "docid": "155379", "title": "", "text": "I tend to agree with Rocky's answer. However it sounds like you want to look at this from the numbers side of things. So let's consider some numbers: I'm assuming you have the money to buy the new car available as cash in hand, and that if you don't buy the car, you'll invest it reasonably. So if you buy the new car today, you're $17K out of pocket. Let's look at some scenarios and compare. Assuming: If you buy the new car today, then after 1 year you'll have: If you keep the old car, after 1 year you get: After 2 years, you have: And after 3 years, you're at: Or in other words, nothing depletes the value of your assets faster than buying the new car. After 1 year, you've essentially lost $5K to depreciation. However, over the short term the immediate cost of the tires combined with the continued depreciation of the old car do reduce your purchasing power somewhat (you won't be able to muster $25K towards a new car without chipping in a bit of extra cash), and inflation will tend to drive the cost of the new car up as time goes on. So the relative gap between the value of your assets and the cost of the new car tends to increase, though it stays well below the $5k that you lose to depreciation if you buy the new car immediately. Which is something that you could potentially spin to support whichever side you prefer, I suppose. Though note that I've made some fairly pessimistic assumptions. In particular, the current U.S. inflation rate is under 1%, and a new car may depreciate by as much as 25% in the first year while older cars may depreciate by less than the 8% assumed. And I selected the cheapest new car price cited, and didn't credit the tires with adding any value to your old car. Each of those aspects tends to make continuing to drive the older car a better option than buying the new one." }, { "docid": "394906", "title": "", "text": "There is nothing right or wrong about this. On such a short goals, you are essentially saying you need $2700 in next 4 months to buy 3 items. Essentially you can have sub-goals to save $675 each month. As you already have some funds; you can go by priority buy the bed and then once you have more saved, buy the laptop and then buy the bed. If you buy the bed now, it means that you will have to wait more for the laptop. If the goals are further apart; say something in few months and something in few years, you would have to create to separate buckets to save and contribute proportionately to both the buckets." }, { "docid": "571711", "title": "", "text": "I'm not an expert, but here's my $0.02. Deductions for business expenses are subject to the 2% rule. In other words, you can only deduct that which exceeds 2% of your AGI (Adjusted Gross Income). For example, say you have an AGI of $50,000, and you buy a laptop that costs $800. You won't get a write-off from that, because 2% of $50,000 is $1,000, and you can only deduct business-related expenses in excess of that $1,000. If you have an AGI of $50,000 and buy a $2,000 laptop, you can deduct a maximum of $1,000 ($2,000 minus 2% of $50,000 is $2,000 - $1,000 = $1,000). Additionally, you can write off the laptop only to the extent that you use it for business. So in other words, if you have an AGI of $50,000 and buy that $2,000 laptop, but only use it 50% for business, you can only write off $500. Theoretically, they can ask for verification of the business use of your laptop. A log or a diary would be what I would provide, but I'm not an IRS agent." }, { "docid": "279824", "title": "", "text": "Not really. You just pay the other side of payroll taxes your employer typically pays. That's 7.65% more on your net. Not that much, all things considered. Plus, on part time Uber driving, the depreciation deduction on a car should exceed true depreciation costs. Putting 10K more miles on a car each year does not result in that much extra depreciation. 2010 Honda Civic DX Sedan 4D with 100K miles is worth $4,500 in Good condition, according to KBB. With 130K miles, it's worth $3,900. That's a difference of $600, or $0.02 per mile. You'll have more oil changes, brake replacements, gas, and other operating costs. But depreciation is small potatoes compared to the $0.535 in deductions per mile. Edit: If you would own a car regardless of whether or not you drive for Uber, Uber isn't a bad deal. It's a bad deal if you have to buy a car just to drive for Uber. It's all about the marginal cost of a mile." }, { "docid": "280699", "title": "", "text": "They represent two distict payment processing mechanisms that just happen to be available on one product. Rather like having dvi and hdmi on you laptop. Your account number and sort code relates to the bank account. Your long number, expiry and ccv relate to the card. It is perfectly possible and not uncommon to have two different cards on the same account, which would have their own card numbers etc. The BACS, CHAPS, DirectDebit and FasterPayments systems use the account numbers. These transactions are practically irreversible and work through the interbank transfer system and should be considered 'direct money transfers' - electronic cash. The long digits are used by Mastercard, Visa, AmEx etc and go through their own payment systems. These payments are 'indirect' and may or may not be reversible as the private payment network (visa etc) has some accountability. They work like electronic cheques. This is why debit card transactions can cause you to go overdrawn - you are writing a promise to pay from an account. It is up to the bank to block the card if you have no money, vs a CHAPS payment that checks the money is there before moving it. It is easier (but still hard) to recover money lost through Visa fraud than BACS. Credit cards have only the long number etc. While savings accounts (non-checking accounts) have only account numbers. Depending on where you are different laws will likely cover debit card vs money transfer payments. In the UK Direct debit guarantee is the most common protection on the BACS system, while standing orders and faster payments give you little legal power. Debit cards will give you some protection because the payment system stands between you and the bank account, so if you didn't make the transaction you should be able to reclaim the money ('card not present fraud'). If you did make the transaction but the vendor failed to supply or goods were faulty then a Chargeback system exists where you may also be able to reclaim. A bank transfer you make is irrecoverable and refund can only be claimed through court for faulty goods." }, { "docid": "34810", "title": "", "text": "\"I'm going to look just at purchase price. Essentially, you can't always claim the whole of the purchase price (or 95% your case) in the year (the accounting period) of purchase, but you get a percentage of the value of the car each year, called writing down allowance, which is a capital allowance. It is similar to depreciation, but based on HRMC's own formula. In fact, it seems you probably can claim 95% of the purchase price, because the value is less than £1000. The logic is a bit involved, but I hope you can understand it. You could also claim simplified expenses instead, which is just based on a rate per mile, but you can't claim both. Note, by year I mean whatever your account period is. This could be the normal financial year, but you would probably have a better idea about this. See The HMRC webpage on this for more details. The big idea is that you record the value of any assets you are claiming writing down allowance on in one of a number of pools, that attract the same rate of writing down allowance, so you don't need to record the value of each asset separately. They are similar to accounts in accounting, so they have an opening balance, and closing balance. If you use an asset for personal use, it needs a pool to itself. HRMC call that a single asset pool. So, to start with, look at the Business Cars section, and look at the Rates for Cars section, to determine the rate you can claim. Each one links to a further article, which gives more detail if you need it. Your car is almost certainly in the special rate category. Special rate is 8% a year, main rate is 18%, and First year allowance is essentially 100%. Then, you look at the Work out what you can claim article. That talks you through the steps. I'll go through your example. You would have a pool for your car, which would end the account period before you bought the vehicle at zero (step 1). You then add the value of the car in the period you bought it (Step 2). You would reduce the value of the pool if you dispose of it in the same year (Step 3). Because the car is worth less than £1,000 (see the section on \"\"If you have £1,000 or less in your pool\"\"), you would normally be able to claim the whole value of the pool (the value of the car) in the first accounting period, and reduce the value of the pool to zero. As you use the car for personal use, you only claim 95% of the value, but still reduce the pool to zero. See the section on \"\"Items you use outside your business\"\". This £1000 is adjusted if your accounting period lasts more or less than 12 months. Once the pool is down to zero that it you don't need to think about it any more for tax purposes, apart from if you are claiming other motoring expenses, or if you sell it. It gets more complicated if the car is more expensive. I'll go through an example for a car worth £2,000. Then, after Step 3, on the year of purchase, you would reduce the value of the pool by 8%, and claim 95% of the reduction. This would be a 160 reduction, and 95%*160 = 152 claim, leaving the value of 1860 in the pool. You then follow the same steps for the next year, start with 1840 in the pool, reduce the value by 8%, then claim 95% of the reduction. This continues until you sell or dispose of the car (Step 3), or the value of the pool is 1000 or less, then you claim all of it in that year. Selling the car, or disposing of the car is discussed in the Capital allowances when you sell an asset article. The basic idea is that if you have already reduced the value of the pool to zero, the price you sell the car for is added you your profits for that year (See \"\"If you originally claimed 100% of the item\"\"), if you still have anything in the pool, you reduce the value of the pool by the sale value, and if it reduces to below zero (to -£200, say), you add that amount (£200, in this case), to your profits. If the value is above zero, you keep applying writing down allowances. In your case, that seems to just means if you sell the car in the same year you buy it, you claim the difference (or 95% of it) as writing down allowance, and if you do it later, you claim the purchase price in the year of purchase, and add 95% of the sale price to your profits in the year you sell it. I'm a bit unclear about starting \"\"to use it outside your business\"\", which doesn't seem to apply if you use it outside the business to start with. You can claim simplified expenses for vehicles, if you are a sole trader or partner, but not if you claim capital allowances (such as writing down allowances) on them, or you include a separate expense in your accounts for motoring expenses. It's a flat rate of 45p a mile for the first 10,000 miles, and 25p per mile after that, for cars, and 24p a mile for motorcycles. See the HRMC page on Simplifed Mileage expenses for details. For any vehicle you decide to either claim capital allowances claim running costs separately, or claim simplified mileage expenses, and \"\"Once you use the flat rates for a vehicle, you must continue to do so as long as you use that vehicle for your business.you have to stick with that decision for that vehicle\"\". In your case, it seems you can claim 95% of the purchase price in the accounting period you buy it, and if you sell it you add 95% of the sale price to your profits in that accounting period. It gets more complicated if you have a car worth more than £1000, adjusted for the length of the accounting period. Also, if you change how you use it, consult the page on selling selling an asset, as you may have disposed of it. You can also use simplified mileage expenses, but then you can't claim capital allowances, or claim running costs separately for that car. I hope that makes sense, please comment if not, and I'll try to adjust the explanation.\"" }, { "docid": "488674", "title": "", "text": "Windows 8 may or may not be awesome, what matters is when people don't like it. I've had to reinstall the CEO's laptop because he refused to use it. He didn't like Windows 8 and didn't want to learn it. I'd say at least 80-90% of the people that I know to have used it, hate it. One of the execs has a Win8 laptop his kids refuse to use, they all fight over the other laptop instead. (he also asked me to reinstall it) That's anecdotal, but from what I've seen it's not getting the greatest reception." }, { "docid": "308549", "title": "", "text": "Some of the other answers mention this, but I want to highlight it with a personal anecdote. I have a property in a mid-sized college town in the US. Its current worth about what we paid for it 9 years ago. But I don't care at all because I will likely never sell it. That house is worth about $110,000 but rents for $1500 per month. It is a good investment. If you take rental income and the increase in equity from paying down the mortgage (subtracting maintenance) the return on the down payment is very good. I haven't mentioned the paper losses involved in depreciation as that's fairly US specific: the laws are different in other jurisdictions but for at least the first two years we showed losses while making money. So there are tax advantages as well (at least currently, those laws also change over time). There is a large difference between investing in a property for appreciation and investing for income. Even in those categories there are niches that can vary widely: commercial vs residential, trendy, vacation/tourist areas, etc. Each has their place, but ensure that you don't confuse a truism meant for one type of real estate investing as being applicable to real estate investing in general." }, { "docid": "488774", "title": "", "text": "Walmart is one of the biggest low wage employers. Let's say $1B of the $2.66B is spent on subsidizing Wal-Mart employees. That's &gt;$3 per US citizen, that we all pay and cannot put back into the economy how we wish. I don't even shop at wal mart and I'm forced to subsidize their employees. IMO, that is not fair. This just incentivizes walmart to hire more cheap government-subsidized employees, rewarding walmart's on my back. So let's do this: For every government dollar spent on helping low-wage employees subsist, we tax the employer the same dollar. From this I bet we would see walmart building housing for their employees, maybe even cafeterias, to get them off section 8 / food stamps. That is more efficient than sending money to the IRS, it makes its way to HUD, then to some government employees who are overburdoned, then we pay out section 8 money to landlords. That's inefficient. I know of walmart employees who rely on $1400/month in section 8, so walmart's tax bill would increase substantially, costs would rise, but tax receipts that we all have to currently pay would decrease by the same amount. So overall costs stay them same, but the finances are more efficient and where they should be vs spread around." }, { "docid": "151810", "title": "", "text": "\"It's not quite as bad as the comments indicate. Form 1040ES has been available since January (and IME has been similarly for all past years). It mostly uses the prior year (currently 2016) as the basis, but it does have the updated (2017) figures for items that are automatically adjusted for inflation: bracket points (and thus filing threshhold), standard deductions, Social Security cap, and maybe another one or two I missed. The forms making up the actual return cannot be prepared very far in advance because, as commented, Congress frequently makes changes to tax law well after the year begins, and in some cases right up to Dec. 31. The IRS must start preparing forms and pubs -- and equally important, setting the specifications for software providers like Intuit (TurboTax) and H&RBlock -- several months ahead in order to not seriously delay filing season, and with it refunds, which nearly everyone in the country considers (at least publicly) to be worse than World War Three and the destruction of the Earth by rogue asteroids. I have 1040 series from the last 4 years still on my computer, and the download dates mostly range from late September to mid January. Although one outlier shows the range of possibility: 2013 form 1040 and Schedule A were tweaked in April 2014 because Congress passed a law allowing charitable contributions for Typhoon Haiyan to be deducted in the prior year. Substantive, but relatively minor, changes happen every year, including many that keep recurring like the special (pre-AGI) teacher supplies deduction (\"\"will they or won't they?\"\"), section 179 expensing (changes slightly almost every year), and formerly the IRA-direct-to-charity option (finally made permanent last year). As commented, the current Congress and President were elected on a platform with tax reform as an important element, and they are talking even more intensely than before about doing it, although whether they will actually do anything this year is still uncertain. However, if major reform is done it will almost certainly apply to future years only, and likely only start after a lag of some months to a year. They know it causes chaos for businesses and households alike to upend without advance warning the assumptions built in to current budgets and plans -- and IME as a political matter something that is enacted now and effective fairly soon but not now is just as good (but I think that part is offtopic).\"" }, { "docid": "30343", "title": "", "text": "\"You've asked a number of questions. I can answer a few. I've quoted your question before each answer. What are the ins and outs of a foreigner like myself buying rental property in Canada? This is a pretty broad question which can address location, finances, basic suggestions etc. Here's some things to consider: Provincial considerations: Some ins and outs will depend on what province you are considering and what area in that Province. If you plan on owning in Montreal, for example, that's in the province of Quebec and that means you (or someone) will need to be able to operate in the French language. There are other things that might be different from province to province. See stat info below. Canadian vs. US Dollar: Now might be a great time to buy property in Canada since the Canada dollar is weak right now. To give you an idea, at a non-cash rate of 1.2846, a little over $76,000 US will get you over $100k Canadian. That's using the currency converter at rbcroyalbank.com. Taxes for non-resident rental property owners: According to the T4144 Income Tax Guide for Electing Under Section 216 – 2015: \"\"When you receive rental income from real or immovable property in Canada, the payer, such as the tenant or a property manager, has to withhold non-resident tax at the rate of 25% on the gross rental income paid or credited to you. The payer has to pay us the tax on or before the 15th day of the month following the month the rental income is paid or credited to you.\"\" If you prefer to send a separate Canadian tax return, you can choose to elect under section 216 of the Income Tax Act. A benefit of this way is that \"\"electing under section 216 allows you to pay tax on your net Canadian-source rental income instead of on the gross amount. If the non-resident tax withheld by the payer is more than the amount of tax payable calculated on your section 216 return, [they] will refund the excess to you.\"\" You can find this guide at Canada Revenue's site: http://www.cra-arc.gc.ca/E/pub/tg/t4144/README.html Stats: A good place for stats is the Canada Mortgage and Housing Corporation (CMHC). So, if you are interesting in vacancy rates for example, you can see a table that will show you that the vacancy rate in Ontario is 2.3% and in British Columbia it's 1.5%. However, in New Brunswick it's 8%. The rate for metropolitan areas across Canada is 2.8%. If you want to see or download this table showing the vacancy rates by province and also by metropolitan areas, go to the Canada Mortgage and Housing Corporation site http://www.cmhc.ca/housingmarketinformation/. You can get all sorts of housing information, reports and market information there. I've done well with Condos/Town-homes and would be interested in the same thing over there. Is it pretty much all the same? See the stat site mentioned above to get market info about condos, etc. What are the down payment requirements? For non-owner occupied properties, the down payment is at least 20%. Update in response to comments about being double taxed: Regarding being taxed on income received from the property, if you claim the foreign tax credit you will not be double taxed. According to the IRS, \"\"The foreign tax credit intends to reduce the double tax burden that would otherwise arise when foreign source income is taxed by both the United States and the foreign country from which the income is derived.\"\" (from IRS Topic 856 - Foreign Tax Credit) About property taxes: From my understanding, these would not be claimed for the foreign tax credit but can be deducted as business expenses. There are various exceptions and stipulations based on your circumstance, so you need to read Publication 856 - Foreign Tax Credit for Individuals. Here's an excerpt: \"\"In most cases, only foreign income taxes qualify for the foreign tax credit. Other taxes, such as foreign real and personal property taxes, do not qualify. But you may be able to deduct these other taxes even if you claim the foreign tax credit for foreign income taxes. In most cases, you can deduct these other taxes only if they are expenses incurred in a trade or business or in the production of in­come. However, you can deduct foreign real property taxes that are not trade or business ex­penses as an itemized deduction on Sched­ule A (Form 1040).\"\" Disclaimers: Sources: IRS Topic 514 Foreign Tax Credit and Publication 856 Foreign Tax Credit for Individuals\"" }, { "docid": "586579", "title": "", "text": "&gt; First of all, any boat or yacht is a terrible investment. The depreciation is horrendous. Can you explain why the depreciation is this way? I don't know much about yachts or boats, so I honestly don't know. Why would a boat depreciate faster/more uncontrollably than any other large asset? Is it because technology is improving too quickly? Because wear and tear on boats is particularly great, even after minimal use? Or because of the relative impossibility of keeping the boat maintained at a comparative speed to its depreciation? Funnily enough, my dad has a boat and the cost of mooring and maintenance is far greater than they joy he gets out of it. That said, I was unaware of the quick depreciation thing." }, { "docid": "594011", "title": "", "text": "\"Straight Line Depreciation is the easiest method of depreciation, don't over think it. Straight Line = (Assets Cost - Assets Salvage Value)/Useful life In this case the Straight Line is $2m per year, it is not culmulative unless you are looking at accumulated depreciation account on the balance sheet. Here is a schedule of the depreciation: * Year 1 - $2m * Year 2 - $2m * Year 3 - $2m * Year 4 - $2m * Year 5 - $2m See, can't get much easier than that! Once you get into more complicated questions they'll throw tax rates at you and ask about cash flows, or the NPV of the cash flows. You need to take into account the fact that the Depreciation is not a \"\"cash expense\"\" but it does affect cash flow by reducing the taxable income of the project. Also, you need to consider the fact that the asset will be sold in year 5 and the value will need to be part of your cash flow and NPV calculations. I hope this was helpful, if not I'll try to do my best answering any other questions. Good Luck!\"" }, { "docid": "241569", "title": "", "text": "Put simply for me, having an 800g device which outperforms my older macbook pro, and therefore not needing to carry my heavy laptop, charger, and tablet into college or work. I could get a Macbook Air, but then i'd still want my tablet. I could get an iPad but then i'd still need my laptop. I also really really like the digitizer." }, { "docid": "585241", "title": "", "text": "There are several factors here. Firstly, there's opportunity cost, i.e. what you would get with the money elsewhere. If you have higher interest opportunities (investing, paying down debt) elsewhere, you could be paying that down instead. There's also domino effects: by reducing your liquid savings to or below the minimum, you can't move any of it into tax advantaged retirement accounts earning higher interest. Then there's the insurance costs. You are required to buy extra insurance to protect your lender. You should factor in the extra insurance you would buy vs the insurance required. Given that you can buy the car yourself, catastrophic insurance may not be necessary, or you may prefer a higher deductible than your lender will allow. If you're not sufficiently capitalized, you may need gap insurance to cover when your car depreciates faster than your loan is paid down. A 30 percent payment should be enough to not need it though. Finally, there's some value in having options. If you have the loan and the cash, you can likely pay it off without penalty. But it will be harder to get the loan if you don't finance it. Maybe you can take out a loan against the car later, but I haven't looked into the fees that might incur. If it's any help, I'm in the last stretch of a 3 year car loan. At the time paying in cash wasn't an option, and having done it I recognize that it's more complicated than it seems." }, { "docid": "244888", "title": "", "text": "First of all, I've been out of college for over a decade, so good job on the assumptions. /s Secondly, when calculating capital gains, you have to take into account the depreciation of the asset. As you would have it, a house owned for 20 years would be fully depreciated, and so no capital gains would apply to such a case. But don't let facts or knowledge get in the way of your trolling, please." }, { "docid": "181985", "title": "", "text": "\"To keep it simple, let's say that A shares trade at 500 on average between April 2nd 2014 and April 1st 2015 (one year anniversary), then if C shares trade on average: The payment will be made either in cash or in shares within 90 days. The difficulties come from the fact that the formula is based on an average price over a year, which is not directly tradable, and that the spread is only covered between 1% and 5%. In practice, it is unlikely that the market will attribute a large premium to voting shares considering that Page&Brin keep the majority and any discount of Cs vs As above 2-3% (to include cost of trading + borrowing) will probably trigger some arbitrage which will prevent it to extend too much. But there is no guarantee. FYI here is what the spread has looked like since April 3rd: * details in the section called \"\"Class C Settlement Agreement\"\" in the S-3 filing\"" } ]

[ { "docid": "331248", "title": "", "text": "Forms for the Colorado LLCs are online. You can find the link to the dissolution form here, and instructions here. IRS instructions are here. That's what they want: To close your business account, send us a letter that includes the complete legal name of the entity, the EIN, the business address and the reason you wish to close your account. If you have a copy of the EIN Assignment Notice that was issued when your EIN was assigned, include that when you write to us at: Internal Revenue Service Cincinnati, Ohio 45999 Everything is pretty straight forward. Note that you might be required to file a initial/final tax return if you had any transactions." } ]

[ { "docid": "207997", "title": "", "text": "You can ask the client to pay you through the LLC. In that case you should invoice them from the LLC and have them pay the invoice. If they pay you personally, you can always make a capital contribution to the LLC and use that money to buy equipment. The tax implications for a single person LLC providing professional services are the same for you either way: income is income whether it's from your LLC or an employer. It's different for the employer if they are giving you a W2 vs a 1099. So it doesn't matter much for you. If the LLC is buying equipment, make sure you get enough revenue through the LLC to at least offset those expenses." }, { "docid": "352640", "title": "", "text": "I am surprised no one has mentioned the two biggest things (in my opinion). Or I should say, the two biggest things to me. First, 1099 have to file quarterly self employment taxes. I do not know for certain but I have heard that often times you will end up paying more this way then even a W-2 employees. Second, an LLC allows you to deduct business expenses off the top prior to determining what you pay in taxes as pass-through income. With 1099 you pay the same taxes regardless of your business expenses unless they are specifically allowed as a 1099 contractor (which most are not I believe). So what you should really do is figure out the expense you incur as a result of doing your business and check with an accountant to see if those expenses would be deductible in an LLC and if it offsets a decent amount of your income to see if it would be worth it. But I have read a lot of books and listened to a lot of interviews about wealthy people and most deal in companies not contracts. Most would open a new business and add clients rather than dealing in 1099 contracts. Just my two cents... Good luck and much prosperity." }, { "docid": "368165", "title": "", "text": "This is business as usual, except that you need to keep in mind that the corporate entity is separate from the individual. As such - all the background checks and references should be with regards to the actual renter - the corporation. You should be cautious as it is not so easy to dissolve an individual (well... Not as easy, and certainly not as legal), as it is to dissolve the corporation. So you may end up with a tenant who doesn't pay and doesn't have to pay because the actual renter, the corporation, no longer exists. So check the corporation background - age, credit worthiness, tax returns/business activity, judgements against, etc etc, as you would do for an individual." }, { "docid": "260603", "title": "", "text": "\"The \"\"independent contractor\"\" vs. \"\"employee\"\" distinction is a red herring to this discussion and not at all important just because someone suggested you use your LLC to do the job. Corp-2-Corp is a very common way to do contracting and having an LLC with business bank accounts provides you with more tax deductions (such as deducting interest on credit lines). Some accounting practices prefer to pay entities by their Tax ID numbers, instead of an individual's social security number. The actual reasoning behind this would be dubious, but the LLC only benefits you and gives you more advantages by having one than not. For example, it is easier for you to hire subcontractors through your LLC to assist with your job, due to the opaqueness of the private entity. Similarly, your LLC can sign Non Disclosure and Intellectual Property agreements, automatically extending the trade secrets to all of its members, as opposed to just you as an individual. By signing whatever agreement with the company that is paying you through your LLC, your LLC will be privy to all of this. Next, assuming you did have subcontractors or other liability inducing assets, the LLC limits the liability you personally have to deal with in a court system, to an extent. But even if you didn't, the facelessness of an LLC can deter potential creditors, for example, your client may just assume you are a cog in a wheel - a random employee of the LLC - as opposed to the sole owner. Having a business account for the LLC keeps all of your expenses in one account statement, making your tax deductions easier. If you had a business credit line, the interest is tax deductible (compared to just having a personal credit card for business purposes). Regarding the time/costs of setting up and managing an LLC, this does vary by jurisdiction. It can negligible, or it can be complex. You also only have to do it once. Hire an attorney to give you a head start on that, if you feel that is necessary. Now back to the \"\"independent contractor\"\" vs. \"\"employee\"\" distinction: It is true that the client will not be paying your social security, but they expect you to charge more hourly than an equivalent actual employee would, solely because you don't get health insurance from them or paid leave or retirement plans or any other perk, and you will receive the entire paycheck without any withheld by the employer. You also get more tax deductions to utilize, although you will now have self employment tax (assuming you are a US citizen), this becomes less and less important the higher over $105,000 you make, as it stops being counted (slightly more complicated than that, but self employment tax is it's own discussion).\"" }, { "docid": "460325", "title": "", "text": "Recommend using quickbooks for account management. If you use the manufacturing and wholesale you can track POs from vendors, estimates, bill payment quotes and invoicing (there's an editor to customize your set up)Also, most accountants are very familiar with this platform so come tax time they'll be able to give you a hand no problem. For accepting payments I highly suggest asking for checks. If you do accept credit cards keep in mind most payment processors charge a percent (1.5-3%) depending on transaction amounts and quantities of transactions. So you'll want to mark up your products by at least that amount. Another area is sales tax. Since you are not the end user you should be able to avoid sales tax on the items you will be selling to customers. You then charge the customer this sales tax. Not sure about NJ but in Texas we are 8.25%. I then pay the state of Texas the taxes collected quarterly. Edit: also make sure you have separate finances for the LLC. Separate checking, separate credit card, separate everything! If you end up using an account that is tied to you personally then you run into the risk of losing the protective nature of an LLC from a legal standpoint. Edit2: by separate I mean using your IRS issued EIN number to open accounts with the LLC name. When you sign anything on behalf of the company make sure to add the name of the company next to it to show the company is making the signature not you. For instance u/sexlessnights Company name, LLC" }, { "docid": "193434", "title": "", "text": "Are you looking for one of the ways to satiate your hunting adventure? We at Colorado Private Ranches can dole out an absolutely pleasurable experience. We offer unguided DIY Elk and Deer hunting and lodging facilities with the complete assurance of begetting a thrilling adventure. http://www.coloradoprivateranches.com/index.php" }, { "docid": "154988", "title": "", "text": "Someone I know had an idea to open a savings account as an LLC or corporation to receive better interest rates on savings, and set up a system where anyone can pool money in and receive a larger cut through savings interest than with a personal account. Is this legal/feasible in any way?" }, { "docid": "362778", "title": "", "text": "The major reason to start an LLC for side work is if you want the additional personal liability protection afforded by one. If you're operating as a sole proprietor, you may be exposing yourself to liability: debts and judgments against your business can put your personal assets at risk! So, if you're intending to continue and grow your side work in the future, you ought to consider the LLC sooner than later. It's also an important legal decision and you should consider seeking a professional opinion. The Wall Street Journal has a brief guide titled How to Form an LLC. Here are some notable excerpts: A limited liability company, or LLC, is similar to a partnership but has the legal protections of personal assets that a corporation offers without the burdensome formalities, paperwork and fees. [...] Some states charge annual fees and taxes that can diminish the economic advantage of choosing to become an LLC. Among LLC advantages: pass-through taxation – meaning the profits and losses “pass through” the business to the individuals owning the business who report this information on their own personal tax returns. The result can be paying less in taxes, since profits are not taxed at both the business level and the personal level. Another plus: Owners aren’t usually responsible for the company’s debts and liabilities. [...] Also check out onstartups.com's Startup 101: Should You Form An Inc. or An LLC? Here are some additional articles that discuss the advantages / disadvantages of forming an LLC:" }, { "docid": "258611", "title": "", "text": "The cost will be around $300-$500 if you do it correctly it in Florida and can be over a $1,000 if you do it in New York (New York is more expensive due to a publication requirement that New York has for LLC’s). The price ranges I’ve given include filing, state fees, getting a tax ID number (EIN), operating agreement, membership certificates, registered agent fees and publication fees if done in New York. Each state also have licensing boards and city fees that are applicable, so you would want to also make sure that you are keeping compliant there. Yearly paperwork to keep the LLC running won’t be so expensive, expect the state to charge a yearly fee and require some basic information to be submitted. I had a quick look at Florida, and with someone filing it for you, expect around $200 to $250 a year, plus registered agent fees. If you are late in Florida the penalty is $400 so you definitely would want a service that provides compliance calendar notifications to make sure you are on time with fees. In regards to bookkeeping and taxes, yearly tax filing will start at $250 to $500 for an LLC and move up from there depending on the services being offered and the amount of time of work. I recently referred someone to an accountant that will charge $250 to file an almost zero tax return on an LLC. I think $40 an hour is a little low for a bookkeeper but it all depends on where you are. I know in some major cities bookkeepers expect $75 an hour or higher. So the expectation in Miami and Manhattan will probably be more expensive than Jacksonville and Albany. If you doing a little business don’t expect the cost to be too much on the bookkeeping. So, breakdown: $300-$500 (FL) - $1,000 (NY) Registration of LLC + any business license, city or other registrations $250 Yearly Fee + Yearly Registered Agent + any business licenses, city or other fee $500 Tax Return + Bookkeeping Fee Banks will charge more than a personal account so expect $120 a year plus. In regards to service I would look at companies that specialize in foreigners setting up businesses in the US, because they will have services designed to help you more than services that primarily specialize with US clients. You are going to have some different needs, based on not having a Social Security Number or establishing from overseas." }, { "docid": "547301", "title": "", "text": "\"Like you said, it's important to keep your personal assets and company assets completely separate to maintain the liability protection of the LLC. I'd recommend getting the business bank account right from the beginning. My wife formed an LLC last year (also as a pass-through sole proprietorship for tax purposes), and we were able to get a small business checking account from Savings Institute and Trust that has no fees (at least for the relatively low quantity of transactions we'll be doing). We wrote it a personal check for startup capital, and since then, the LLC has paid all of its own bills out of its checking account (with associated debit card). Getting the account opened took less than an hour of sitting at the bank. Without knowing exactly where you are in Kentucky, I note that Googling \"\"kentucky small business checking\"\" and visiting a few banks' web sites provided several promising options for no-fee business checking.\"" }, { "docid": "155490", "title": "", "text": "This new roof should go on the 2016 LLC business return, but you probably won't be able to expense the entire roof as a repair. A new roof is most likely a capital improvement, which means that it would need to be depreciated over many years instead of expensed all in 2016. The depreciation period for a residential rental property is 27.5 years. Please consider seeking a CPA or Enrolled Agent for the preparation of your LLC business return. See also: IRS Tangible Property Regulations FAQ list When you made the loan to the LLC (by paying the contractor and making a contract with the LLC), did you state an interest rate? If not, you and your brother should correct the contract so that an interest rate is stated, then follow it. The LLC needs to pay you interest until the loan is paid off. You need to report the interest income on your personal return, and the LLC needs to report the interest expense in its business return." }, { "docid": "152027", "title": "", "text": "It seems that you're complicating things quite a bit. Why would you not create a business entity, open one or more bank accounts for it, and then have the money wired into those accounts? If you plan on being a company then set up the appropriate structure for it. In the U.S., you can form an S-corporation or an LLC and choose pass-through taxation so that all you pay is income tax on what you receive from the business as personal income. The business itself would not have tax liability in such a case. Co-mingling your personal banking with that of your business could create real tax headaches for you if you aren't careful, so it's not worth the trouble or risk." }, { "docid": "205719", "title": "", "text": "First, yes, your LLC has to file annual taxes to the US government. All US companies do, regardless of where their owners live. Second, you will also probably be liable to personally file a return in the US and unless the US has a tax treaty with India (which I don't believe it does) you may end up paying taxes on your same income to both countries. Finally, opening a US bank account as a foreign citizen can be very tricky. You need to talk to a US accountant who is familiar with Indian & US laws." }, { "docid": "393337", "title": "", "text": "\"I realize I'm drudging up a somewhat old post here (apologies), but I've found myself in a similar situation recently and thought I would chime in. I was considering buying a car where the loan amount would be right around 25k. I tried justifying this by saying it's ridiculously fast (I'm young and stupid, this is appealing), has AWD (nice for Colorado), and a hatchback with plenty of room for snowboards and whatnot in back. This is in comparison to my Civic which has high mileage, can hardly make it up hills due to the high altitude, sucks in snow, and has little room for anything. You have your reasons, I have mine. The thing is, our reasons are just us trying to rationalize an unwise purchase - just admit it, you know it's true. Just so you can see I'm in a similar financial situation, I'm 22, just graduated, and started a job making well over 80k with salary and signing bonus, plus 20k in RSUs on the side. After budgeting I can still put away over 2k/month after I've factored in a car payment, insurance, rent, etc etc. Yes, I could \"\"afford\"\" this car... it's just dumb though dude. Don't do it. There are better things we can do with our money. And guess what, I've been drooling over this car since middle school too.\"" }, { "docid": "320616", "title": "", "text": "\"It'll be just like any other loan you make, on your end, and receive, on your LLC's end. You pay taxes on the interest received, and your LLC can deduct the interest paid. Do make sure you set it up properly, however: If you want to loan money to your business, you should have your attorney draw up paperwork to define the terms of the loan, including repayment and consequences for non-repayment of the loan. It should be clear that the loan is a binding obligation on the part of the company. As a recent Tax Court case notes, the absence of such paperwork negates the loan. For tax purposes, the loan is an \"\"arms length\"\" transaction, being treated like any other debt. From: http://biztaxlaw.about.com/od/financingyourstartup/f/investinbusiness.htm\"" }, { "docid": "436522", "title": "", "text": "\"Trump is paying off his election \"\"debt\"\" to the oil industry because if he doesn't their money won't be there the next time he needs it. If you think he gives a shit about anything else, you've been smokin' Colorado way to much.\"" }, { "docid": "359814", "title": "", "text": "Starting and running a business in the US is actually a lot less complicated than most people think. You mention incorporation, but a corporation (or even an S-Corp) isn't generally the best entity to start a business with . Most likely you are going to want to form an LLC instead this will provide you with liability protection while minimizing your paperwork and taxes. The cost for maintaining an LLC is relatively cheap $50-$1000 a year depending on your state and you can file the paperwork to form it yourself or pay an attorney to do it for you. Generally I would avoid the snake oil salesman that pitch specific out of state LLCs (Nevada, Delaware etc..) unless you have a specific reason or intend on doing business in the state. With the LLC or a Corporation you need to make sure you maintain separate finances. If you use the LLC funds to pay personal expenses you run the risk of loosing the liability protection afforded by the LLC (piercing the corporate veil). With a single member LLC you can file as a pass through entity and your LLC income would pass through to your federal return and taxes aren't any more complicated than putting your business income on your personal return like you do now. If you have employees things get more complex and it is really easiest to use a payroll service to process state and federal tax with holding. Once your business picks up you will want to file quarterly tax payments in order to avoid an under payment penalty. Generally, most taxpayers will avoid the under payment penalty if they owe less than $1,000 in tax after subtracting their withholdings and credits, or if they paid at least 90% of the tax for the current year, or 100% of the tax shown on the return for the prior year, whichever is smaller. Even if you get hit by the penalty it is only 10% of the amount of tax you didn't pay in time. If you are selling a service such writing one off projects you should be able to avoid having to collect and remit sales tax, but this is going to be very state specific. If you are selling software you will have to deal with sales tax assuming your state has a sales tax. One more thing to look at is some cities require a business license in order to operate a business within city limits so it would also be a good idea to check with your city to find out if you need a business license." }, { "docid": "560468", "title": "", "text": "\"Businesses need websites. Especially businesses in the labor field -- when we renovated our old home, the very first place we checked was Google. \"\"Colorado Springs plumbers\"\"; \"\"Colorado Springs electrician\"\" -- I was shocked at how few actually had websites. It's worth the money for a simple, but informative site with contact info, prices, etc. Oh, and also, social media. Get on the Twitter! And everywhere else online that people are gathering.\"" }, { "docid": "500130", "title": "", "text": "I don't think that's the only reason. You can buy a big house in Colorado and pay very low taxes compared to other parts of the country. I think family sizes are just going down and people aren't starting families as early in their life as they have historically." } ]

[ { "docid": "229990", "title": "", "text": "\"Are there businesses which professionally invest ethically? Yes. The common term for this is \"\"socially responsible investing\"\". Looking at that page and googling that term should provide you with plenty of pointers to funds to investigate. Of course, the definitions of \"\"ethical\"\" and \"\"socially responsible\"\" vary from person to person and fund to fund. You'll have to take a look at each fund to see which ones match your principles.\"" } ]

[ { "docid": "79060", "title": "", "text": "It feels a bit like the entire system needs an overhaul, one wonders if a more automated economy and rising presence of AI will enable it or be an ethical barrier. It seems there's poor long-term planning for these sorts of issues where UBI is a last-ditch fix for a system that's no longer working for the working class." }, { "docid": "82614", "title": "", "text": "I'm speaking of the investment I'm making in my own skills and work ethic, which would still be extremely valuable even if I was a terrible person who didn't give a shit about anyone else. That said, where I've worked, no one is getting locked in the building at night or threatened (although one of my employers did try to pay me under the table one time). My experience with organized labor in my workplaces has been that the leaders whine about having to do stuff that is actually part of their job and don't actually provide much of a benefit to the workers. I'm not saying this is true for all employers - organized labor is obviously an important check on employers that abuse their employees. But in my experience, having an organized workforce is not a universal positive. Rather, its value depends on the leadership of the union and whether the working conditions are actually abusive to begin with." }, { "docid": "218316", "title": "", "text": "Not arguing about ethics, but why is this a problem? They didn't make anything worse/more difficult/more dangerous. In fact, all this does is help anyone who has the discontinued 60. They didn't pay for a 75, so it's not like they didn't get what they paid for. Would it make you happier if the 60 came with a smaller battery and you had to buy a different one to upgrade? Of course, then they have no way of assisting consumers trying to evacuate, but that's a fair price to pay for a less convenient way to upgrade your vehicle, right?" }, { "docid": "429010", "title": "", "text": "The US never *had* this...Average people have *always* been considered cogs in the machine in America. It's a part of the twisted ethic that runs this place. Those who lift themselves above the morass are those who are celebrated and objectified. Those who cannot deserve their fate. It's why we can't have nice things." }, { "docid": "389333", "title": "", "text": "If you are searching for a country home or a new homes in Renton WA just a few hours from Washington, 1000 First Street is a wise choice. Datta Homes is one of the top real estate agent, providing exceptional real estate service in Washington, based on the highest standard of ethics." }, { "docid": "498640", "title": "", "text": "\"You're right to seek passive income and since you're already looking for it, you probably already know some of the reasons to why it is important. Do you live in the United States? If so I'd strongly recommend purchasing your primary residence and then maybe investment properties if you like owning your own home. The US tax and banking structure is set up to favor this move in more ways than I can count. So, SAVE, SAVE, SAVE then beg, borrow and steal to get the down payment, rent rooms to friends or random people to afford the payments, buy a fixer upper in an up and coming neighborhood. The US is rife with these in all price ranges. If you're working 56 hrs a week, you've got the work ethic. So if you can't afford it it's probably because you're spending all your money on other stuff. If you want to do this, it will take some effort, smarts, and savings. You will have to trim back the mochas, vacations, dinners out, etc, etc etc. Let your friends do that stuff and rent from you. Your life will get continually easier. If you have already trimmed back all the discretionary spending and still can't make it then you need to earn more money. Doing either and both of these things will absolutely change your whole economic life and future. So in summary I'd offer these Ranked Priorities: 1) Learn to Save (unless you always want to have to work for someone else) 2) Increase your income capability (since your most valuable asset is YOU) 3) Buy and hold real estate (because the game is rigged to favor passive income) I'm 38, never earned a six figure salary, made some good purchases when I was 25-30 and work is \"\"optional\"\" for me now.\"" }, { "docid": "538361", "title": "", "text": "\"To be honest, why haven't startups taken advantage of Uber's shitty image to launch \"\"ethical\"\" uber taxi services? I love Uber's service, but i'd be ready to pay 50% extra on a ride if i know the drivers are paid right and the company holds a good vision.\"" }, { "docid": "400103", "title": "", "text": "Stated preferences vs. revealed preferences. People say they are willing to buy American, support mom and pop shops, buy higher quality goods, be ethical consumers, etc. until it comes down to actually paying for them, when most people will end up choosing based on price." }, { "docid": "269579", "title": "", "text": "You need growth in your retirement fund. Sad to say but the broad U.S. marks still has better growth perspective than the emerging markets. Look at China they are only at 6.7% growth for next year the same as this year. Russia's economy is shrinking. These are the other two super powers of 2015. The USA is still the best market to invest in historically and in the present. That's why the USA market tends to be overweight in most retirement portfolios. Now by only investing in the USA market do you miss out on trends internationally? Well you do a bit but not entirely. Many USA companies are highly international in regards to their growth. Here are some: So in short the USA market still seems to be the best growth market and you still get some international exposure. Also by investing in USA companies they sometimes are more ethical in their book keeping as opposed to some other markets. I don't think I'm the only one that is skeptical of the numbers China's government reports." }, { "docid": "177362", "title": "", "text": "The bottom line is choosing the right partner. If your partner works as hard as you do, than everything should be split, irregardless of who makes more. Unfortunately, my bf, now by separated husband, borrowed money from me before we were married. I saw a lack of work ethic in him from the beginning, loved him anyway and married him but decided to keep my money separate as a result. This was a beginning with lack of trust and knowing I would be the higher earner, harder worker, and better provider. Down the road he won a lawsuit and got about $700k. I saw about $25k of this money to pay bills created with the intention of him paying them off when he got the money, and because he pilfered it away, we lost our house and it ended in my leaving.... I'm still doing ok because I work hard for what I have. He is struggling. We were never on the same page, never discussed finances because of his lack of work ethic and my mistrust of how he would decide how the money would be used. Sadly, who you decide to be your partner is the most important decision here...It should be based on mutual respect, both working hard to achieve a common goal, and communicating the budget every year, perhaps even each month.... I'm the terrible example." }, { "docid": "414735", "title": "", "text": "Most of them still pay partial taxes, albeit not all of those are federal. Boeing and GE might be the worst offenders ethically as they are federal contractors who also benefit from US agreements with other countries that grant additional sales for the two firms' military hardware." }, { "docid": "71036", "title": "", "text": "\"(Ignoring any ethical considerations of defaulting on a mortgage obligation) If your credit score fell, future costs of borrowing would be greater, if you could borrow money at all. The true financial cost of these penalties would depend on your own intentions and circumstances. The value of a credit score cannot be quantified in any absolute sense because of these circumstances which will vary from person to person. Suppose a decision would result in your score falling from 700 to 600. As a result, a future car loan would cost something like 2% more in interest per year. Let's also suppose you would not be able to find a bank to give you money to buy a new home. The difficulties caused by this situation would depend on the person. Some people have no intention of taking out another mortgage or buying another car, and to them, a lowered credit score might make no difference. To others, it would be desirable to avoid these penalties. The value of credit score would be equal to how much you would be willing to pay in the present to avoid these future penalties. If you intend to borrow money in the near future, and somehow know how much more interest you will pay as a result of your lower score, then you could approximate the value of the credit drop by summing all of the additional interest costs discounted into the present. Something a little like this: Year's Additional Cost in Interest / (1 + Your Personal Opportunity Cost of Funds) ^ (Years in the future this extra interest will be paid). See time value of money explanation: Can you explain \"\"time value of money\"\" and \"\"compound interest\"\" and provide examples of each? It could also be the case that you miss out on valuable financial opportunities as a result which could be added to the present value of the credit score drop. For example, if the drop made you totally unable to purchase an investment property that would net you $10,000 in cash flows /year (which would yield cash flows immediately). The value of that investment would have been $10,000 / (1 + Your Personal Opportunity Cost of Funds). Since you would not be able to make that investment (in this example) as a result of the decreased score, the present value of the investment would be an opportunity cost of the lower score. There are other hard-to-quantify costs of low credit to consider as well, ranging from housing to employment to bragging rights. Hopefully this has helped :)\"" }, { "docid": "507368", "title": "", "text": "\"I like Muro questions! No, I don't think they do. Because for me, as a personal finance investor type just trying to save for retirement, they mean nothing. If I cannot tell what the basic business model of a company is, and how that business model is profitable and makes money, then that is a \"\"no buy\"\" for me. If I do understand it, they I can do some more looking into the stock and company and see if I want to purchase. I buy index funds that are indexes of industries and companies I can understand. I let a fund manager worry about the details, but I get myself in the right ballpark and I use a simple logic test to get there, not the word of a rating agency. If belong in the system as a whole, I could not really say. I could not possibly do the level of accounting research and other investigation that rating agencies do, so even if the business model is sound I might lose an investment because the company is not an ethical one. Again, that is the job of my fund manager to determine. Furthermore and I mitigate that risk by buying indexes instead of individual stock.\"" }, { "docid": "398823", "title": "", "text": "\"&gt; Because something is legal doesn't make it the ethical choice. &gt; &gt; You fail to demonstrate what is unethical about minimizing tax burdens. Operating in a country that allows you to make profit, in my opinion, establishes a duty to pay one's fair share of taxes. Paying legislators to make laws enabling tax avoidance is, in my mind, unethical. Clearly we have a different idea of what is ethical and not. &gt; corporations making huge profits using the infrastructure of the region &gt; &gt;Did the corporations have an option to refuse using that infrastructure, and instead provide their own or work with others to develop a competing infrastructure? Yes. &gt; Keep in mind that these favorable tax laws were lobbied by corporations with the intent to avoid taxes in mind. &gt;&gt;You have failed to support any argument that there is anything wrong with minimizing tax burden. That's like your opinion man. I don't think minimizing taxes by paying off legislators is equitable...call me crazy. &gt;If I'm walking behind someone and they happen to drop a $100 bill without noticing, I can certainly pick it up and put it in my pocket legally, but its hardly the moral thing to do. &gt;&gt;A more relevant example is if I order a pizza, have it sent to your house, then show up later with a bill for the pizza and my costs to send it to you, demanding you pay it. You never asked for the pizza, maybe you didn't want the pizza, maybe you didn't eat the pizza, maybe you don't like pizza, or don't like that kind of pizza. That I choose to send you a pizza does not obligate you to pay for that pizza. Lost me on this one bro...I thought we were talking ethics...not surprise pizzas. How about this one: I go to your house, use your kitchen and ingredients to make a pizza, sell the pizza for a profit and give you nothing even though we had an agreement that if I could make a profit I would give you some. However, I decide to talk to your roommate and give him a measly dollar to say \"\"forget about it bro...I said it's cool\"\".\"" }, { "docid": "348092", "title": "", "text": "\"Two possibilities that I can think of: 1) They recognize that it is stealing and just choose to do it anyway because of the unlikelihood of getting caught or punished. 2) They see an ethical distinction between stealing and \"\"gaming the system\"\" wherein if the store opens up a loophole it is not wrong to exploit it. EDIT: Note that these are just my theories for the motivations of the people who are participating in this, my own personal opinions are not necessarily reflected in this post.\"" }, { "docid": "593279", "title": "", "text": "If you are looking to hire a competent work injury attorney, then do your homework; research them, their work ethic, their commitment, their knowledge and record of winning. The right professionals have the experience to help people get what is owed to them" }, { "docid": "423355", "title": "", "text": "That seems unrealistic given his history of supporting corruption and ethics breaches. He was warned about corruption, ethical, and loyalty concerns for a bunch of his cabinet and he brought them on anyway. These people did not get outed by trump, they abandoned him because he is a petulent, poorly performing, and all around unstable executive. He cant even respond to domestic terrorism in any acceptable way." }, { "docid": "325246", "title": "", "text": "&gt;Not everything is about marginal utility and trying to define people by their marginal utility is almost sociopathic. This needs to be said more often. Walmart earned $4B this quarter yet they pay their employees slave wages. They could afford to pay every one of their employees an extra $3 per hour and still make huge profits. That's a 25% raise. Apple, to extend the comparison, earned $8B yet pay their contractors slave wages. Perhaps they should revise the ethics classes for business degrees and start teaching social responsibility as well." }, { "docid": "169423", "title": "", "text": "Apparently, you have never visited with any Elders. The money provided by the government has undermined the work ethic of the native Americans which is why drug and alcohol abuse is rampant in their communities. If you pay some to do nothing they will do nothing." } ]

[ { "docid": "523415", "title": "", "text": "Avoiding tobacco, etc is fairly standard for a fund claiming ethical investing, though it varies. The hard one on your list is loans. You might want to check out Islamic mutual funds. Charging interest is against Sharia law. For example: http://www.saturna.com/amana/index.shtml From their about page: Our Funds favor companies with low price-to-earnings multiples, strong balance sheets, and proven businesses. They follow a value-oriented approach consistent with Islamic finance principles. Generally, these principles require that investors avoid interest and investments in businesses such as liquor, pornography, gambling, and banks. The Funds avoid bonds and other conventional fixed-income securities. So, it looks like it's got your list covered. (Not a recommendation, btw. I know nothing about Amana's performance.) Edit: A little more detail of their philosophy from Amana's growth fund page: Generally, Islamic principles require that investors share in profit and loss, that they receive no usury or interest, and that they do not invest in a business that is prohibited by Islamic principles. Some of the businesses not permitted are liquor, wine, casinos, pornography, insurance, gambling, pork processing, and interest-based banks or finance associations. The Growth Fund does not make any investments that pay interest. In accordance with Islamic principles, the Fund shall not purchase conventional bonds, debentures, or other interest-paying obligations of indebtedness. Islamic principles discourage speculation, and the Fund tends to hold investments for several years." } ]

[ { "docid": "169423", "title": "", "text": "Apparently, you have never visited with any Elders. The money provided by the government has undermined the work ethic of the native Americans which is why drug and alcohol abuse is rampant in their communities. If you pay some to do nothing they will do nothing." }, { "docid": "47946", "title": "", "text": "I think the main question is whether the 1.5% quarterly fee is so bad that it warrants losing $60,000 immediately. Suppose they pull it out now, so they have 220000 - 60000 = $160,000. They then invest this in a low-cost index fund, earning say 6% per year on average over 10 years. The result: Alternatively, they leave the $220,000 in but tell the manager to invest it in the same index fund now. They earn nothing because the manager's rapacious fees eat up all the gains (4*1.5% = 6%, not perfectly accurate due to compounding but close enough since 6% is only an estimate anyway). The result: the same $220,000 they started with. This back-of-the-envelope calculation suggests they will actually come out ahead by biting the bullet and taking the money out. However, I would definitely not advise them to take this major step just based on this simple calculation. Many other factors are relevant (e.g., taxes when selling the existing investment to buy the index fund, how much of their savings was this $300,000). Also, I don't know anything about how investment works in Hong Kong, so there could be some wrinkles that modify or invalidate this simple calculation. But it is a starting point. Based on what you say here, I'd say they should take the earliest opportunity to tell everyone they know never to work with this investment manager. I would go so far as to say they should look at his credentials (e.g., see what kind of financial advisor certification he has, if any), look up the ethical standards of their issuers, and consider filing a complaint. This is not because of the performance of the investments -- losing 25% of your money due to market swings is a risk you have to accept -- but because of the exorbitant fees. Unless Hong Kong has got some crazy kind of investment management market, charging 1.5% quarterly is highway robbery; charging a 25%+ for withdrawal is pillage. Personally, I would seriously consider withdrawing the money even if the manager's investments had outperformed the market." }, { "docid": "318986", "title": "", "text": "\"We're not \"\"helping\"\" the company in a comparable sense to donating money to a non-profit. As you wrote, investing in a company deals with ownership and in a sense, becoming a part owner of a company, even if it is a minor ownership, indicates that we sense it has some sort of value, whether that's ethical, financial or tangible value. As investors, we should take responsibility and ensure that our voices are heard when voting occurs (sadly, not too common). EDIT: @thepassiveinvestor makes an excellent point that this paragraph only applies to IPOs: Keep in mind, when we purchase stock in a company, that money is used for business purposes. It also signals value to the market as well, if enough money or enough investors buy the stock.\"" }, { "docid": "429010", "title": "", "text": "The US never *had* this...Average people have *always* been considered cogs in the machine in America. It's a part of the twisted ethic that runs this place. Those who lift themselves above the morass are those who are celebrated and objectified. Those who cannot deserve their fate. It's why we can't have nice things." }, { "docid": "543042", "title": "", "text": "Not sure you read my post based on your word choice but.... CFP is more of a marketing ploy from a consumer behavior perspective. You don't need a CFP to have the technology or knowledge to utilize what is taught in the modules and plenty of CFPs will still give shit advice. When choosing an advisor it comes down to ethics, work ethic, knowledge, experience, and fee structure in that order. Not saying to never hire a CFP, but just because somebody has a CFP doesn't mean they'll actually be any better than any other advisor." }, { "docid": "316058", "title": "", "text": "This is bullshit. It's only doing what it's programmed to do. This completely avoid the issue of: 1) who did the programming to make a business this way? 2) is this, in any way, ethical? Cancer cells are just doing what they do best, so much so that they excel at doing what they do. Doesn't make them good for the organism." }, { "docid": "141257", "title": "", "text": "Pay to play in business is normal and completely ethical. You want to be in the Yellow pages, you have to pay. You want to be associated with an elite group of like businesses and share leads, you have to pay. You want to be in the Chamber of Commerce, you have to pay. There's tons of businesses that are in invite only groups that cost $10,000+ a year and $300 a month just for sharing leads and those leads are worth the cost." }, { "docid": "9055", "title": "", "text": "Drugs, and medicine in general, are most certainly not inelastic. There is competition from less expensive analogs, and, unfortunately, nothing. There is always an optimum price as long as there is a marketplace. If we want cheaper drugs then we ought to reform patents (in a real sense) and lower barriers to competition. Medical companies are obviously lowering their ethical safeguards for selling drugs cheap when they don't have to so that can't be relied upon anymore." }, { "docid": "58720", "title": "", "text": "\"This article is so maddening. Near the end when they're talking about the ethics guy and retroactively recusing himself I just couldn't take it anymore. In fairness, I don't really blame Icahn, or even Trump. In a way this stuff has been boiling up over the last 20 years as the country has adopted this Ayn Rand style of wealth sycophantism/worship. The bailout and Trump are just the epitome of it and his goals and ethics are exactly as advertised. When this is what your society values this is what we get. I hope we vote in a democratic senate just so at least a tiny bit of justice will hit these self serving assholes. It's one thing for Icahn to do the \"\"greed is good\"\" thing but another to blatantly lie to everyone (including himself) that he is being anything other than greedy. Helping minority owned refineries? Good lord.\"" }, { "docid": "368482", "title": "", "text": "\"This is a legal issue, or possibly an ethical issue, and not really a finance issue. And I am not a lawyer. But for what it's worth: Did you sign a written contract with H&R Block? If so, then the terms of that contract would govern. If you signed a contract saying that you agree to file your taxes through them if they meet such-and-such conditions, and they met these conditions, then you are legally obligated. If there was no written contract, then I think any court would take the conversation between you and H&R Block as an oral contract. If H&R Block said, basically, \"\"Okay, we'll calculate what we think your taxes are, and if we come up with something better than what you had before, then you agree to file your taxes through us\"\", and you said \"\"Oh, okay\"\", then that's an oral contract. You agreed to their conditions. Legally, oral contracts are just as binding as written contracts. The only difference is that it is difficult to prove exactly what was said. If you really did agree to these conditions, I suppose you could lie and say you didn't and then try to convince a court that they are the ones lying. Obvious ethical problems there. There are also implied contracts. If HRB's advertising or paperwork says that you're agreeing to file through them if they meet the conditions, I thing that a court would likely rule that you implicitly agreed to their terms by doing the review. In any case, when you go to some place like HRB mostly what you are paying for is their knowledge and expertise. So if they give you the benefit of their expertise -- they tell you how to reduce your taxes -- and then you don't pay them, that seems rather unethical to me. The situation is muddied by the fact that you paid $100 for the review. Is that paying for the basic information, the \"\"tax tip\"\", and paying for them to file is then a contract for additional work? Under some circumstances I'd say yes, that's additional work and thus an additional contract, so in the absence of a contract obligating me, I don't have to do that. The catch in this case is that at that point they must have already pretty much taken all your information and filled out all the forms. All that's left is to press the \"\"send\"\" button and submit the return, right?\"" }, { "docid": "371747", "title": "", "text": "True, that Colleges remove the lowest common denominator of ability: students who get F in classes. If you have a degree, you are probably above average in your mental abilities. But when it comes to practical knowledge, personality needed for work and in the workplace, work ethics, etc, they are not very beneficial. Actually, all those topics, practical knowledge, personality, work ethics, etc are self-taught or skills you you are born with. Cannot be taught." }, { "docid": "82614", "title": "", "text": "I'm speaking of the investment I'm making in my own skills and work ethic, which would still be extremely valuable even if I was a terrible person who didn't give a shit about anyone else. That said, where I've worked, no one is getting locked in the building at night or threatened (although one of my employers did try to pay me under the table one time). My experience with organized labor in my workplaces has been that the leaders whine about having to do stuff that is actually part of their job and don't actually provide much of a benefit to the workers. I'm not saying this is true for all employers - organized labor is obviously an important check on employers that abuse their employees. But in my experience, having an organized workforce is not a universal positive. Rather, its value depends on the leadership of the union and whether the working conditions are actually abusive to begin with." }, { "docid": "222783", "title": "", "text": "There is normally a policy at the organisation that would restrict trades or allow trades under certain conditions. This would be in accordance with the current regulations as well as Institutions own ethical standards. Typical I have seen is that Technology roles are to extent not considered sensitive, ie the employees in this job function normally do not access sensitive data [unless your role is analyst or production support]. An employee in exempt roles are allowed to trade in securities directly with other broker or invest in broad based Mutual Funds or engage a portfolio management services from a reputed organisation. It is irrelevant that your company only deals with amounts > 1 Million, infact if you were to know what stock the one million is going into, you may buy it slightly earlier and when the company places the large order, the stock typically moves upwards slightly, enough for you to make some good money. That is Not allowed. But its best you get hold of a document that would layout the do' and don't in your organisation. All such organisation are mandated to have a written policy in this regard." }, { "docid": "370870", "title": "", "text": "When I did my CSC waaaaay back in the day (when there was 1 4 hour exam and 2 assignments, fuck I'm old) this is what I did. I took the week after New Years off, and studied exclusively for the CSC. I did nothing else but study (but I had done a lot of prep before) then I wrote the exam after a week of non-stop study. To be honest, the exam isn't difficult - at least the finance parts. The tricky parts are the pure memorization ones, which are almost all compliance/ethics questions (e.g. how long do you have to notify the OSC of a change in address, etc). Do not ignore these sections as they do test on ethics/compliance a lot." }, { "docid": "296736", "title": "", "text": "How in the hell can they put a positive spin on this? 1. Consumers cars were materially modified without their consent. 2. They were modified in such a way that indicates they may have previously been sold cars governed for marketing reasons, not engineering reasons. Tesla is another Uber- just waiting on the horrific ethics and working conditions stories to happen." }, { "docid": "596858", "title": "", "text": "I work at a public accounting firm. It's in tax, but I know the audit side of the house pretty well as well. &gt;Without public confidence in the profession, CPA firms wouldn't exist. It's truly an incentive to do a good job and continually gain confidence. They incidentally make money along the way. That's really the heart of the argument. During my schooling we talked about ethics pretty much constantly. In almost every state now, you're required to take a 3 credit hour ethics class prior to sitting for the CPA exam, and you're required to do continuing education. How much depends on the state, but 40-60 hours every three years is par for the course. Of those hours, typically 4-5 of them have to be approved ethics courses. There's also a whole litany of codes of conduct that a CPA must follow. For example, I, as a tax person am bound to follow the codes of conduct of: * The SEC * The PCAOB * The IRS * The AICPA * My State Board of Accountancy * My Firm A serious violation of any one of those codes can lead to a suspension of my license. e.g. I won't ever be able to work in public accounting again. As a profession, most of the CPA's that I've met are above board, but there will always be a few bad apples. On the audit side, the PCAOB (a government agency) audits all the public accounting firms that do assurance work something like every 3 years. The SEC can get involved as well if they think something fishy is going on." }, { "docid": "521102", "title": "", "text": "From personal experience, stick with the IRS. As @littleadv pointed out I found the APR to be significantly lower (and for me it stayed the same through out the years I was on the plan - the penalty amount shown on the statement increases as it accumulates, but the APR stays the same) and, unlike credit cards, the debt does not show on your credit report. So unless you tell the bank about it, they won't know (not speaking to to ethical side of not telling them, that'd be up to you)." }, { "docid": "423355", "title": "", "text": "That seems unrealistic given his history of supporting corruption and ethics breaches. He was warned about corruption, ethical, and loyalty concerns for a bunch of his cabinet and he brought them on anyway. These people did not get outed by trump, they abandoned him because he is a petulent, poorly performing, and all around unstable executive. He cant even respond to domestic terrorism in any acceptable way." }, { "docid": "444604", "title": "", "text": "He made a no-context vegan comment in a thread where no one was talking about diets or dietary ethics at all. I mean, you can check out his comment history. He's on some kind of pro-vegan comment bender right now." } ]

[ { "docid": "23221", "title": "", "text": "Domini offers such a fund. It might suit you, or it might include things you wish to avoid. I'm not judging your goals, but would suggest that it might be tough to find a fund that has the same values as you. If you choose individual stocks, you might have to do a lot of reading, and decide if it's all or none, i.e. if a company seems to do well, but somehow has an tiny portion in a sector you don't like, do you dismiss them? In the US, Costco, for example, is a warehouse club, and treats employees well. A fair wage, benefits, etc. But they have a liquor store at many locations. Absent the alcohol, would you research every one of their suppliers?" } ]

[ { "docid": "114527", "title": "", "text": "Context: assessed project as part of a tech internship in an investment bank, working in small groups, task: to design an app using a financial solution that has an ethical impact. We came up with (what I hope) is the smart sounding idea of an app for impoverished farmers in developing countries who lack the information and market access that larger or unionised farmers would have. The app would use some kind of decision tree (which may grow with machine learning) to assess the best kind of crops to grow given the region and local conditions for max profitability, and would provide access to some kind of derivatives market, and insurance, allowing the farmers a consistent income. Struggling with the specifics of how the business/finance side of things would work. Let's assume the bank builds the app and puts it on the app-store as part of some charitable initiative. 1) Would the farmers go directly to the bank to price and purchase derivatives on their crops? 2) Options/futures/forwards - which is most appropriate, or would it make sense to offer all three? 3) Is there any way this could be adjusted to provide regular payments, with a lump sum at the end? Would this be something the bank chooses to do, or is there an existing financial instrument for this kind of setup? 4) How does this tie in with the commodities markets (or is that what the derivatives already are?) 5) Probably a long-shot but any chance of know-your-customer implementations for countries with terrible infrastructure? 6) (probably a dumb question) Say the farmer sells an option on his crops, would this be sold directly to the bank or a 3rd party who'd be more interested in actually buying the crop? Or is this a far too simplistic view? Basically who would the farmer actually deliver the crops to? 7) Any other issues/oversights? Any ideas to make this sound somewhat viable? It doesn't have to strictly be realistic in any sense, but it also can't be flat-out incorrect! tyvm in advance, edited to make questions clearer" }, { "docid": "543042", "title": "", "text": "Not sure you read my post based on your word choice but.... CFP is more of a marketing ploy from a consumer behavior perspective. You don't need a CFP to have the technology or knowledge to utilize what is taught in the modules and plenty of CFPs will still give shit advice. When choosing an advisor it comes down to ethics, work ethic, knowledge, experience, and fee structure in that order. Not saying to never hire a CFP, but just because somebody has a CFP doesn't mean they'll actually be any better than any other advisor." }, { "docid": "151051", "title": "", "text": "Yes and no. This really should be taught at junior school level in a capitalist country but that is a different argument. A company is influenced by its shareholders but not in the way you are hoping. This is the only area where a Company must behave democratically with one share one vote. If you own one share in a company (specifically a voting share), then you are entitled to attend an AGM where you will have a vote on issues presented by the board. You might have an opportunity to make a statement or ask a question at the AGM, but I wouldn't rely on it. You will not be able to influence the companies behavior beyond that unless you control enough shares to influence the board. Notice I said 'control' not 'own'. If you get other shareholders to agree to vote with you, then you effectively control their shares. Shareholders are there to get a return on their investment, so you must convince them that they will get a better return by agreeing with you then by following the board (that they put there!). Convince them that (for example) a trespass lawsuit will rob the company of more value then the profit to be made and they might agree to not trespass. Morals, ethics, justice etc., are human attributes and since most shareholders are other corporations not humans, they have no place in your arguments with one exception; Goodwill is a value that appears on a balance sheet and you might be able to use emotional arguments to show that there is a risk of a loss of goodwill from the proposed actions. You can make your argument stronger by generating media pressure on customers and suppliers of the company to make critical public comments." }, { "docid": "597383", "title": "", "text": "Ethics aside, it seems like you'd have to do this so many times, and split it up between many different stores to avoid suspicion, that you're better off putting that time and effort into a real job. 20 transactions only gets you $200." }, { "docid": "316058", "title": "", "text": "This is bullshit. It's only doing what it's programmed to do. This completely avoid the issue of: 1) who did the programming to make a business this way? 2) is this, in any way, ethical? Cancer cells are just doing what they do best, so much so that they excel at doing what they do. Doesn't make them good for the organism." }, { "docid": "507368", "title": "", "text": "\"I like Muro questions! No, I don't think they do. Because for me, as a personal finance investor type just trying to save for retirement, they mean nothing. If I cannot tell what the basic business model of a company is, and how that business model is profitable and makes money, then that is a \"\"no buy\"\" for me. If I do understand it, they I can do some more looking into the stock and company and see if I want to purchase. I buy index funds that are indexes of industries and companies I can understand. I let a fund manager worry about the details, but I get myself in the right ballpark and I use a simple logic test to get there, not the word of a rating agency. If belong in the system as a whole, I could not really say. I could not possibly do the level of accounting research and other investigation that rating agencies do, so even if the business model is sound I might lose an investment because the company is not an ethical one. Again, that is the job of my fund manager to determine. Furthermore and I mitigate that risk by buying indexes instead of individual stock.\"" }, { "docid": "518378", "title": "", "text": "At MyBusinessOnlinePortal.com, Andrew Barnes sets out in a short and succinct introduction his no-nonsense ethos for professional, ethical home business. Followed by a sentence or two on his select choice of top opportunities, the page is framed with all his networking and contact info. His tagline is - Ready to share 8+ years experience to help all succeed. you would do much worse than to take him up on his offer." }, { "docid": "598447", "title": "", "text": "Kraemer &amp; Kraemer is well perfect in the complexities of international commercial and financial practices. We provide legal solutions to key corporate clients. We are the well-versed Law firm in Panama. Our capability stretches across various jurisdictions. Our staff is young professionals who are very dynamic and have a with a high sense of responsibility and ethics that provide his best service." }, { "docid": "169423", "title": "", "text": "Apparently, you have never visited with any Elders. The money provided by the government has undermined the work ethic of the native Americans which is why drug and alcohol abuse is rampant in their communities. If you pay some to do nothing they will do nothing." }, { "docid": "400103", "title": "", "text": "Stated preferences vs. revealed preferences. People say they are willing to buy American, support mom and pop shops, buy higher quality goods, be ethical consumers, etc. until it comes down to actually paying for them, when most people will end up choosing based on price." }, { "docid": "325246", "title": "", "text": "&gt;Not everything is about marginal utility and trying to define people by their marginal utility is almost sociopathic. This needs to be said more often. Walmart earned $4B this quarter yet they pay their employees slave wages. They could afford to pay every one of their employees an extra $3 per hour and still make huge profits. That's a 25% raise. Apple, to extend the comparison, earned $8B yet pay their contractors slave wages. Perhaps they should revise the ethics classes for business degrees and start teaching social responsibility as well." }, { "docid": "498640", "title": "", "text": "\"You're right to seek passive income and since you're already looking for it, you probably already know some of the reasons to why it is important. Do you live in the United States? If so I'd strongly recommend purchasing your primary residence and then maybe investment properties if you like owning your own home. The US tax and banking structure is set up to favor this move in more ways than I can count. So, SAVE, SAVE, SAVE then beg, borrow and steal to get the down payment, rent rooms to friends or random people to afford the payments, buy a fixer upper in an up and coming neighborhood. The US is rife with these in all price ranges. If you're working 56 hrs a week, you've got the work ethic. So if you can't afford it it's probably because you're spending all your money on other stuff. If you want to do this, it will take some effort, smarts, and savings. You will have to trim back the mochas, vacations, dinners out, etc, etc etc. Let your friends do that stuff and rent from you. Your life will get continually easier. If you have already trimmed back all the discretionary spending and still can't make it then you need to earn more money. Doing either and both of these things will absolutely change your whole economic life and future. So in summary I'd offer these Ranked Priorities: 1) Learn to Save (unless you always want to have to work for someone else) 2) Increase your income capability (since your most valuable asset is YOU) 3) Buy and hold real estate (because the game is rigged to favor passive income) I'm 38, never earned a six figure salary, made some good purchases when I was 25-30 and work is \"\"optional\"\" for me now.\"" }, { "docid": "242875", "title": "", "text": "Whole Foods will not get one cent of my money as long as they have homeopathic bullshit on the shelves next to actual medicine. Pretending they're somehow ethical is nonsense. They are simply exploiting consumers that don't realize they suffer from the naturalistic fallacy." }, { "docid": "471474", "title": "", "text": "Any system of social organization that sees enough generational poverty that people like yourself are advocating that others don't have the moral right to procreate is an abject failure. If you don't see that, then there's no point in discussion. You can look down your nose and lecture 'responsibility' to poor people all you want, but you're only revealing an abhorrent lack of ethics and compassion on your part and a dismal failure of our economic system as a whole." }, { "docid": "222783", "title": "", "text": "There is normally a policy at the organisation that would restrict trades or allow trades under certain conditions. This would be in accordance with the current regulations as well as Institutions own ethical standards. Typical I have seen is that Technology roles are to extent not considered sensitive, ie the employees in this job function normally do not access sensitive data [unless your role is analyst or production support]. An employee in exempt roles are allowed to trade in securities directly with other broker or invest in broad based Mutual Funds or engage a portfolio management services from a reputed organisation. It is irrelevant that your company only deals with amounts > 1 Million, infact if you were to know what stock the one million is going into, you may buy it slightly earlier and when the company places the large order, the stock typically moves upwards slightly, enough for you to make some good money. That is Not allowed. But its best you get hold of a document that would layout the do' and don't in your organisation. All such organisation are mandated to have a written policy in this regard." }, { "docid": "501024", "title": "", "text": "I do not think it is work ethic. I think the issue is people just do not have a choice but to do whatever their employer wants. If everyone was say rich then they could just tell their employer to F*** Off. Or if the USA had a strong economic safety net then people could tell their boss to F*** Off. But since the USA does not then the people are just wage slaves. I think the work ethic in other countries is more extreme than the USA but those nations people do tell their employer to get lost." }, { "docid": "136324", "title": "", "text": "\"This is a joke article, right? Besides the fact the author apparently can't use a space bar to save his life, the article is basically saying \"\"Silly CEO, you expect all these creative free spirits to do actual 'work'? What's wrong with you, being concerned with things like 'profit'. If you want to hire a bunch of disloyal slackers who will jump ship the second someone else utters the word 'stock options', you're going to have to get over this whole 'work ethic' thing.\"\"\"" }, { "docid": "538361", "title": "", "text": "\"To be honest, why haven't startups taken advantage of Uber's shitty image to launch \"\"ethical\"\" uber taxi services? I love Uber's service, but i'd be ready to pay 50% extra on a ride if i know the drivers are paid right and the company holds a good vision.\"" }, { "docid": "49627", "title": "", "text": "Speaking as a CFA charter holder in an alternative asset class, the CFA designation is beneficial to any role in finance. Not only does it provide a framework for understanding economics, accounting, financial instruments and markets, etc, the real value to me, is the signal it provides to others. For me, the CFA signals a level of intellectual sophistication and work ethic that employers, prospects, etc. Maybe asset management jobs aren't as in demand as previously, but I'm sure a CFA charter holder has a better chance of finding a retaining that role" } ]

[ { "docid": "219977", "title": "", "text": "\"Markets are amoral. If you don't buy stock in a company that has high growth/earnings, someone else will. By abstaining you will actually make it cheaper for someone else who is interested in making money. Investing in \"\"socially responsible\"\" funds will only ensure that you have less money to make a moral difference in the world when you decide to transition from working to philanthropy. Edit to clarify -- You aren't interested in buying individual stocks directly, that leaves you with two general options: You can make a statement with your investment now, or you can take the better returns and make a difference with your money later.\"" } ]

[ { "docid": "49655", "title": "", "text": "Ethics and sources of meat aside, it's important to note the markets are currently not working. There are farm subsidies keeping the cost of meat low and many externalities generated from meat production (eg cow methane) which are paid for.by society and not the producer. Fix those issues and I'm right there with you!" }, { "docid": "44563", "title": "", "text": "Yes, work ethic is the key element. I too hate to be negative but they have taken me on a couple run-a-rounds that were not pleasant. The key is to micro-manage in an open room in cross-functional teams. The right hand feeds the left. Treating them like Americans works w/o raising salary by taking them to strip clubs or other entertainment that stimulates. But it's not easy." }, { "docid": "293243", "title": "", "text": "There are lots of answers here, but I'll add my two cents... The best way to win is not to play. MLM is not a viable business model. Don't go in thinking you'll beat the system by trying harder than everyone else. The only way you'll make any money is by recruiting lots of people, and selling products that can be obtained for cheaper elsewhere at a normal store. If your friend already committed to the decision and they're wise as to what's going on, yet gullible enough to try anyways, have them think about the ethics of exploiting the people down the pyramid from them. Maybe that will change their mind. All of the other answers about not investing too much of your own money remain true. You don't want to blow your life savings on a pipe dream." }, { "docid": "389333", "title": "", "text": "If you are searching for a country home or a new homes in Renton WA just a few hours from Washington, 1000 First Street is a wise choice. Datta Homes is one of the top real estate agent, providing exceptional real estate service in Washington, based on the highest standard of ethics." }, { "docid": "509552", "title": "", "text": "You make some very valid points. However, does the state spend the money because they are incompetent; or, because that is how the state is structured to be? If the latter; then, by whom? Why do you think we start wars that a five year old could even understand is a sham? Why do we have overcrowded prisons? Follow the money.... Remember, the rich stay rich not because of their morals, ethics, or good behavior." }, { "docid": "166556", "title": "", "text": "\"Your argument comes down to \"\"he is presumed guilty until proven innocent\"\", a common injustice found in many authoritarian dictatorships and theocracies throughout history. Your argument seems based on the assumption that M. Armstrong is guilty without a requirement for any evidence that he did anything. I reject your 'guilty until proven innocent' as ethically bankrupt.\"" }, { "docid": "597383", "title": "", "text": "Ethics aside, it seems like you'd have to do this so many times, and split it up between many different stores to avoid suspicion, that you're better off putting that time and effort into a real job. 20 transactions only gets you $200." }, { "docid": "218316", "title": "", "text": "Not arguing about ethics, but why is this a problem? They didn't make anything worse/more difficult/more dangerous. In fact, all this does is help anyone who has the discontinued 60. They didn't pay for a 75, so it's not like they didn't get what they paid for. Would it make you happier if the 60 came with a smaller battery and you had to buy a different one to upgrade? Of course, then they have no way of assisting consumers trying to evacuate, but that's a fair price to pay for a less convenient way to upgrade your vehicle, right?" }, { "docid": "318986", "title": "", "text": "\"We're not \"\"helping\"\" the company in a comparable sense to donating money to a non-profit. As you wrote, investing in a company deals with ownership and in a sense, becoming a part owner of a company, even if it is a minor ownership, indicates that we sense it has some sort of value, whether that's ethical, financial or tangible value. As investors, we should take responsibility and ensure that our voices are heard when voting occurs (sadly, not too common). EDIT: @thepassiveinvestor makes an excellent point that this paragraph only applies to IPOs: Keep in mind, when we purchase stock in a company, that money is used for business purposes. It also signals value to the market as well, if enough money or enough investors buy the stock.\"" }, { "docid": "441568", "title": "", "text": "manage the company properly. If you aren't much aware about company rules and regulation or tax matters, get an accountant so that you don't mess up later. better off paying my self a dividend of 100% profit or as an employee? That depends on how much salary you intend to pay yourself, your dividend or how much business expenses you will incur while running the business. Generally speaking you are better off paying your self a minimum salary and pay the rest as dividends. But check out the dividend tax and the income tax you might need to pay and compare which situation you are better off. If you have a partner, using the dividend way will reduce your NI outgoes. ethical and legal? Ethically the dividend way might burn your conscience but it is perfectly legal way of doing things." }, { "docid": "480428", "title": "", "text": "\"&gt; This is why, seriously, I think we need to get moral philosophers involved in AI projects, so we can *embed some ethics at the core*. Am programmer. This is impossible with our current understanding of neural networks. Second only to \"\"who's morals would we use?\"\".\"" }, { "docid": "507368", "title": "", "text": "\"I like Muro questions! No, I don't think they do. Because for me, as a personal finance investor type just trying to save for retirement, they mean nothing. If I cannot tell what the basic business model of a company is, and how that business model is profitable and makes money, then that is a \"\"no buy\"\" for me. If I do understand it, they I can do some more looking into the stock and company and see if I want to purchase. I buy index funds that are indexes of industries and companies I can understand. I let a fund manager worry about the details, but I get myself in the right ballpark and I use a simple logic test to get there, not the word of a rating agency. If belong in the system as a whole, I could not really say. I could not possibly do the level of accounting research and other investigation that rating agencies do, so even if the business model is sound I might lose an investment because the company is not an ethical one. Again, that is the job of my fund manager to determine. Furthermore and I mitigate that risk by buying indexes instead of individual stock.\"" }, { "docid": "9055", "title": "", "text": "Drugs, and medicine in general, are most certainly not inelastic. There is competition from less expensive analogs, and, unfortunately, nothing. There is always an optimum price as long as there is a marketplace. If we want cheaper drugs then we ought to reform patents (in a real sense) and lower barriers to competition. Medical companies are obviously lowering their ethical safeguards for selling drugs cheap when they don't have to so that can't be relied upon anymore." }, { "docid": "520177", "title": "", "text": "Actually I think direct financial kickbacks are a minor factor in this problem. In most cases a physician makes nothing from the writing of a prescription. What does influence a physician is the never ending attempts of pharmaceutical companies to 'educate' them. This goes far beyond simple drug reps visits given that most medical conventions and a goodly number of 'continuing education' events are manufacturer sponsored. There are many hidden benefits that flow from this tactic, and few could be expressed as 'direct payoffs'. It's a race between professional ethics and marketing tactics, and at least in the USA ethics are often left in the dust. There is also another factor which may have even greater weight - the demand from patients, one's medical education/indoctrination and society in general to ''do something''. The value of literally doing nothing isn't emphasized enough in medical education; nor is it appreciated by the general public. Sometimes ''doing something'' is fairly benign. Wave your hands, prescribe a pill or engage in alternative/voodoo medicine. Most diseases will get better on their own despite the doctor's best efforts. Once more this situation is at its worst in the USA. American physicians are notoriously aggressive and are very prone to overtreatment. Given the long standing and well documented failure of the American system to measure up in terms of outcomes compared to other countries this aggression has nothing but negative empirical support in its favour. The dismal performance of US medicine isn't only because of its gross inequalities. There are other factors at play, and overtreatment is one. You won't necessarily get *better* treatment because you are either wealthy or have wonderful insurance, but you will definitely get *more* treatment." }, { "docid": "239977", "title": "", "text": "I'm interested in how this will fit in with the anti gmo and organic produce crowed. There is such a push back against engineered plants, I wonder if it will be the same against this or will the ethical and environmental benefits silence those voices?" }, { "docid": "371747", "title": "", "text": "True, that Colleges remove the lowest common denominator of ability: students who get F in classes. If you have a degree, you are probably above average in your mental abilities. But when it comes to practical knowledge, personality needed for work and in the workplace, work ethics, etc, they are not very beneficial. Actually, all those topics, practical knowledge, personality, work ethics, etc are self-taught or skills you you are born with. Cannot be taught." }, { "docid": "370870", "title": "", "text": "When I did my CSC waaaaay back in the day (when there was 1 4 hour exam and 2 assignments, fuck I'm old) this is what I did. I took the week after New Years off, and studied exclusively for the CSC. I did nothing else but study (but I had done a lot of prep before) then I wrote the exam after a week of non-stop study. To be honest, the exam isn't difficult - at least the finance parts. The tricky parts are the pure memorization ones, which are almost all compliance/ethics questions (e.g. how long do you have to notify the OSC of a change in address, etc). Do not ignore these sections as they do test on ethics/compliance a lot." }, { "docid": "51715", "title": "", "text": "\"Theory of Levered Investing Borrowing in order to increase investment exposure is a time-honored and legitimate activity. It's the optimal way to increase your exposure, according to finance theory (which assumes you get a good interest rate...more on this later). In your case it may or may not be a good idea. Based on the information in your post, I believe that in your case it is not a good idea. Consider the following concerns. Risk In finance, reward comes with risk and in no other way. Investing borrowed money means there is a good (not small) chance that you will lose enough money that you will need to pull significant wealth from your own savings in order to make up the difference. If you are in a position to do this and OK with that possibility, then proceed to to the next concern. If losing a lot of money means financial calamity for you, then this is a bad idea. You haven't described your financial situation so I don't know in which camp you fall. If the idea of losing, say, $100K means complete financial failure for you, then the strategy you have described simply has too much risk. Make no mistake, just because the market makes money on average does not mean it will make money, or as much money as you expect, over your horizon. It may lose money, perhaps a lot of money. Make sure this idea is very clear in your mind before taking action. Rewards Your post implies that you think you can reliably get 10%-12% on an investment. This is not the case. There are many years in which a reasonable portfolio makes this much or more, but on average you will earn less. No ones knows the true long-term market risk premium, but it is definitely less than 10%. A better guess would be 6.5% plus whatever the risk-free rate is (currently about 0%). Buying \"\"riskier\"\" investments means deviating from the optimal portfolio, meaning you took on more risk than is justified by how much extra money you expect to make. I never encourage people to invest based on optimistic or unrealistic goals. If anything, you should be conservative about how you expect things to go. And remember, these are averages. Any portfolio that earns 10%-12% also has a very good chance of losing 25% or more. People who sell or give advice on investments frequently get you charged up by pointing at times and investments that have done very well. Unfortunately, we never know whether the investments and time period in which we are investing will be a good one, a bad one, or an unexciting one. The reality of investing is...well, more realistic than what you have described. Costs I can't imagine how you could borrow that much money and only have an annual payment of $2000 as you imply--that must be a mistake. No individual borrows at a rate significantly below 1%. It sounds like it's not a collateralized loan of any kind, so unless you are some kind of prime-loan customer, your interest rate will be significant. Subtract whatever rate you actually pay from 6.5% to get a rough idea of how much you will make if things go as well as they do on average. You will pay the interest whether times are good or bad. If your rate is typical of noncollateralized personal loans, there's a good chance you will lose money on average using the strategy you have described. If you are OK with taking risk with a negative expected return, consider a trip to Las Vegas. It's more exciting. Ethics I'm not one to make people feel guilty for doing things that are legal but of questionable morality. If that's the case and you are OK with it, more power to you. I'm not sure under what pretense you expect to obtain the money, but it sounds like you might be crossing legal lines and committing actual crimes (like fraud). Make sure to check on whether what you intend is a white lie or something that can get you thrown in prison. For example, if you are proposing obtaining a subsidized education loan and using it for speculation, I could easily see you spending serious time in prison and permanently ruining your life, even if your plan works out. A judge and 12 of your peers are not going to think welfare fraud is a harmless twist of the truth. Summary I've said a lot of negative things here. This is because I have to guess about your financial situation and it sounds like you may have unrealistic expectations of the safety and generosity of investing. Quite frankly, people for whom borrowing $250K is no big deal don't normally come and ask about it on StackExchange and they definitely don't tend to lie in order to get loans. Also $18K a year doesn't change their quality of life. However, I don't know. If $250K is small relative to your wealth and you need a good way to increase your exposure to the market risk premium, then borrowing and investing may well be a good idea.\"" }, { "docid": "552604", "title": "", "text": "Honestly? Literally anything else. The same way budgets have been done since the dawn of time. If you have a mandatory expense (livable wage because we're prioritizing human life over discretionary spending because ethics) you trim the fat from other areas to make it work." } ]

[ { "docid": "13013", "title": "", "text": "There are a number of mutual funds which claim to be 'ethical'. Note that your definition of 'ethical' may not match theirs. This should be made clear in the prospectus of whichever mutual fund you are looking at. You will likely pay for the privilege of investing this way, in higher expenses on the mutual fund. If I may suggest another option, you may want to consider investing in low-fee mutual funds or ETFs and donating some of the profit to offset the moral issues you see." } ]

[ { "docid": "598447", "title": "", "text": "Kraemer &amp; Kraemer is well perfect in the complexities of international commercial and financial practices. We provide legal solutions to key corporate clients. We are the well-versed Law firm in Panama. Our capability stretches across various jurisdictions. Our staff is young professionals who are very dynamic and have a with a high sense of responsibility and ethics that provide his best service." }, { "docid": "338050", "title": "", "text": "You win, you are more pedantic than me. I give up. Edit: okay, I think I can be more pedantic than you here actually. Corporations don't even have to follow the law as long as their revenue from breaking the law is greater than the consequences of breaking said law. Ethics come from proper regulation." }, { "docid": "596858", "title": "", "text": "I work at a public accounting firm. It's in tax, but I know the audit side of the house pretty well as well. &gt;Without public confidence in the profession, CPA firms wouldn't exist. It's truly an incentive to do a good job and continually gain confidence. They incidentally make money along the way. That's really the heart of the argument. During my schooling we talked about ethics pretty much constantly. In almost every state now, you're required to take a 3 credit hour ethics class prior to sitting for the CPA exam, and you're required to do continuing education. How much depends on the state, but 40-60 hours every three years is par for the course. Of those hours, typically 4-5 of them have to be approved ethics courses. There's also a whole litany of codes of conduct that a CPA must follow. For example, I, as a tax person am bound to follow the codes of conduct of: * The SEC * The PCAOB * The IRS * The AICPA * My State Board of Accountancy * My Firm A serious violation of any one of those codes can lead to a suspension of my license. e.g. I won't ever be able to work in public accounting again. As a profession, most of the CPA's that I've met are above board, but there will always be a few bad apples. On the audit side, the PCAOB (a government agency) audits all the public accounting firms that do assurance work something like every 3 years. The SEC can get involved as well if they think something fishy is going on." }, { "docid": "96158", "title": "", "text": "Heard. Once-lauded? It's still very prestigious, the article argued it can't claim the de-facto numero uno business school because partially of some ethical issues that have harmed the integrity of the school. MBAs from top-tier institutions, even public ones, are highly valuable." }, { "docid": "239977", "title": "", "text": "I'm interested in how this will fit in with the anti gmo and organic produce crowed. There is such a push back against engineered plants, I wonder if it will be the same against this or will the ethical and environmental benefits silence those voices?" }, { "docid": "370870", "title": "", "text": "When I did my CSC waaaaay back in the day (when there was 1 4 hour exam and 2 assignments, fuck I'm old) this is what I did. I took the week after New Years off, and studied exclusively for the CSC. I did nothing else but study (but I had done a lot of prep before) then I wrote the exam after a week of non-stop study. To be honest, the exam isn't difficult - at least the finance parts. The tricky parts are the pure memorization ones, which are almost all compliance/ethics questions (e.g. how long do you have to notify the OSC of a change in address, etc). Do not ignore these sections as they do test on ethics/compliance a lot." }, { "docid": "389333", "title": "", "text": "If you are searching for a country home or a new homes in Renton WA just a few hours from Washington, 1000 First Street is a wise choice. Datta Homes is one of the top real estate agent, providing exceptional real estate service in Washington, based on the highest standard of ethics." }, { "docid": "270994", "title": "", "text": "\"I'm surprised at the tone of the answers to this question! Trading with insider information is corruption and encourages fraud. As in many areas, there's an ethical line where behavior the gap between \"\"ok\"\" and \"\"illegal\"\" or unethical is thin. The classic local government insider information example is when the local councilman finds out that a highway exit is being constructed in an area that consists mostly of farmland. Knowing this, he buys out the farmers at what they think is a premium, and turns around for 10x profit a few months later. In that context, do you think that the councilman acting on that insider information is committing a crime or ethical lapse? Most people say yes. Even in this case, the line is thin. If the same councilman has his finger on the pulse of growth patterns in the area, and realizes that the terrain makes a certain area a prime candiate for a highway and exit, buying up land would not be criminal -- but it would be risky as it creates a perception that he is abusing his position.\"" }, { "docid": "580963", "title": "", "text": "\"I think the other answers raise good points. But to your question, \"\"How do I find an honest financial adviser\"\" ask your friends and family. See who they talk to and confide in. Go meet that person, understand what they do and how they view things and if you gel, great. Honesty and strong ethics exist in individuals regardless of laws. What is it you're trying to accomplish? You just have some money you want to put aside? You want to save for something? You want to start a budget or savings plan? Your first step may be talking to a tax person, not an investment adviser. Sometimes the most significant returns are generated when you simply retain more of your earnings and tax people know how to accomplish that. You're just graduating university, you're just going to get your first job. You don't need to hunt for the right heavy hitter 30% gains generating financial adviser. You need to establish your financial foundation. Crawl, walk, then run. There are some basics (that transcend international borders). If you don't know much about investing, most (if not all) retirement and individual brokerage type accounts will give you access to some kind of market index fund. You don't need to multinationally diversify in to high fee funds because \"\"emerging markets are screaming right now.\"\" Typically, over a few years the fees you pay in the more exotic asset classes will eat up the gains you've made compared to a very low fee market index fund. You can open free accounts at a number of financial institutions. These free accounts at these banks all have a list of zero commission zero load funds, all have something resembling an index fund. You can open your account for free, deposit your money for free, and buy shares in an index fund for free.\"" }, { "docid": "593279", "title": "", "text": "If you are looking to hire a competent work injury attorney, then do your homework; research them, their work ethic, their commitment, their knowledge and record of winning. The right professionals have the experience to help people get what is owed to them" }, { "docid": "597683", "title": "", "text": "&gt; just allow injured parties to sue for damages! The legal system isn't based on ethics or morals, it's based on who can make the best argument. Big business' have a lot more resources and lawyers than you or I could ever hope to have." }, { "docid": "217237", "title": "", "text": "Hello Wall Street! I would like to remind you all once again that the march of computer automation will continue to take your jobs. Put in those 100 hour weeks. Kiss ass. Discard your ethics. Do whatever you want because in the end, you WILL be beaten by a $3000 machine. You cannot win this battle. Nobody in HISTORY has won this battle. We'll see you soon!" }, { "docid": "480428", "title": "", "text": "\"&gt; This is why, seriously, I think we need to get moral philosophers involved in AI projects, so we can *embed some ethics at the core*. Am programmer. This is impossible with our current understanding of neural networks. Second only to \"\"who's morals would we use?\"\".\"" }, { "docid": "86923", "title": "", "text": "\"I can see where they're coming from, but at the same time, who says STEM people can't think philosophically/ethically too? Ultimately it may come down to one person's word against another's. Do we really need schools to give people \"\"critical thinking\"\" or \"\"philosophically-versed\"\" degrees in order to have an opinion in a tech company? Aren't we all equally as creative?\"" }, { "docid": "356136", "title": "", "text": "We try to offer a personalized service with a committed and qualified work team. We carry out our work with love, honesty and responsibility based on ethical and moral principles. Medical devices are essential for safe and effective prevention, diagnosis, treatment and rehabilitation of diseases and conditions. Our commitment is and has been to serve our customers by offering products of the highest technology that facilitate the work of doctors and help a prompt recovery of the patient." }, { "docid": "429361", "title": "", "text": "Legal, yes. Ethical, no. It's unfortunate that our culture has transitioned into this behavior but in order to not be replaced by hungry college grads than you need to understand that the week isn't over until your work is complete. Hopefully, in time, this particular culture subsides..." }, { "docid": "519663", "title": "", "text": "I understand what you mean, but for the general population the technicalities of secondary market is fundamentally a grey area. However, in my opinion, leading financial institutions such as GS, I expect them to make prudent decisions that is both ethical &amp; sustainable for the society as whole, even though it might not be feasible all the time." }, { "docid": "58720", "title": "", "text": "\"This article is so maddening. Near the end when they're talking about the ethics guy and retroactively recusing himself I just couldn't take it anymore. In fairness, I don't really blame Icahn, or even Trump. In a way this stuff has been boiling up over the last 20 years as the country has adopted this Ayn Rand style of wealth sycophantism/worship. The bailout and Trump are just the epitome of it and his goals and ethics are exactly as advertised. When this is what your society values this is what we get. I hope we vote in a democratic senate just so at least a tiny bit of justice will hit these self serving assholes. It's one thing for Icahn to do the \"\"greed is good\"\" thing but another to blatantly lie to everyone (including himself) that he is being anything other than greedy. Helping minority owned refineries? Good lord.\"" }, { "docid": "272162", "title": "", "text": "\"Shariah compliant investments attempt to achieve your \"\"ethical investing\"\" ideals. Many countries around the world have a long list of shariah compliant investments and lots of journalists will go great lengths to reveal when a company is not really shariah compliant. Standard & Poors (S&P), an American financial services company, hosts a Shariah compliant index too, but on the Toronto Stock Exchange in Canada due to the Islamaphobia rampant in the United States. But of course, international companies are indifferent to any single country's social problems, and in your new pastime as an international speculator you will get the same luxury too and exemption from the political spectrum. S&P/TSX 60 information can be found here: http://web.tmxmoney.com/tmx_indices.php?section=tsx&index=%5ETXSI Business sectors prohibited from the Shariah index include: Gambling, Pornography, Tobacco, amongst others. In the United States, the concept has been renamed \"\"B-Corporation\"\" (a play on the federal term C-Corporation and S-Corporation), and has garnered enough of a movement that several states have created these as entities people can actually register them with the state, but these are not recognized as \"\"B-Corporations\"\" to the federal government. Shariah compliant investments will be easier to find worldwide, due to the popularity of the associated religion.\"" } ]

[ { "docid": "248361", "title": "", "text": "There are the Dow Jones Sustainability Indices. I believe the reports used to create them are released to the public. This could be a good place to start." } ]

[ { "docid": "325246", "title": "", "text": "&gt;Not everything is about marginal utility and trying to define people by their marginal utility is almost sociopathic. This needs to be said more often. Walmart earned $4B this quarter yet they pay their employees slave wages. They could afford to pay every one of their employees an extra $3 per hour and still make huge profits. That's a 25% raise. Apple, to extend the comparison, earned $8B yet pay their contractors slave wages. Perhaps they should revise the ethics classes for business degrees and start teaching social responsibility as well." }, { "docid": "377266", "title": "", "text": "\"There is a distinction between putting a lot of hours into building a semi autonomous business and having your Accountant and Tax Lawyer find legal loopholes so you can avoid millions of dollars of debt again and again. Then you are using the word \"\"passive income\"\" wrong. \"\"What would become of an economy if 50% of a population decided they didn't like working and so took up speculating stock prices full time?\"\" 50%+ of the population isn't intelligent enough to even do this. The ones that are probably don't make much money. It's a huge gamble. What if 50% of the population decided to gamble in Vegas full time? It's just as absurd. \"\"Yes, it is \"\"smart\"\" to abuse every existing loophole, but it is not ethical and it is certainly not sustainable without being to the detriment of others. I prefer a system where people have integrity and where manipulating others is looked down upon, rather than admired.\"\" I still don't know where you even got this idea. I've read the book and he doesn't even really talk about this. \"\"but it is not ethical and it is certainly not sustainable without being to the detriment of others\"\" You're right, it isn't, which is why most people don't do it for a living.\"" }, { "docid": "169423", "title": "", "text": "Apparently, you have never visited with any Elders. The money provided by the government has undermined the work ethic of the native Americans which is why drug and alcohol abuse is rampant in their communities. If you pay some to do nothing they will do nothing." }, { "docid": "177362", "title": "", "text": "The bottom line is choosing the right partner. If your partner works as hard as you do, than everything should be split, irregardless of who makes more. Unfortunately, my bf, now by separated husband, borrowed money from me before we were married. I saw a lack of work ethic in him from the beginning, loved him anyway and married him but decided to keep my money separate as a result. This was a beginning with lack of trust and knowing I would be the higher earner, harder worker, and better provider. Down the road he won a lawsuit and got about $700k. I saw about $25k of this money to pay bills created with the intention of him paying them off when he got the money, and because he pilfered it away, we lost our house and it ended in my leaving.... I'm still doing ok because I work hard for what I have. He is struggling. We were never on the same page, never discussed finances because of his lack of work ethic and my mistrust of how he would decide how the money would be used. Sadly, who you decide to be your partner is the most important decision here...It should be based on mutual respect, both working hard to achieve a common goal, and communicating the budget every year, perhaps even each month.... I'm the terrible example." }, { "docid": "217237", "title": "", "text": "Hello Wall Street! I would like to remind you all once again that the march of computer automation will continue to take your jobs. Put in those 100 hour weeks. Kiss ass. Discard your ethics. Do whatever you want because in the end, you WILL be beaten by a $3000 machine. You cannot win this battle. Nobody in HISTORY has won this battle. We'll see you soon!" }, { "docid": "521102", "title": "", "text": "From personal experience, stick with the IRS. As @littleadv pointed out I found the APR to be significantly lower (and for me it stayed the same through out the years I was on the plan - the penalty amount shown on the statement increases as it accumulates, but the APR stays the same) and, unlike credit cards, the debt does not show on your credit report. So unless you tell the bank about it, they won't know (not speaking to to ethical side of not telling them, that'd be up to you)." }, { "docid": "47946", "title": "", "text": "I think the main question is whether the 1.5% quarterly fee is so bad that it warrants losing $60,000 immediately. Suppose they pull it out now, so they have 220000 - 60000 = $160,000. They then invest this in a low-cost index fund, earning say 6% per year on average over 10 years. The result: Alternatively, they leave the $220,000 in but tell the manager to invest it in the same index fund now. They earn nothing because the manager's rapacious fees eat up all the gains (4*1.5% = 6%, not perfectly accurate due to compounding but close enough since 6% is only an estimate anyway). The result: the same $220,000 they started with. This back-of-the-envelope calculation suggests they will actually come out ahead by biting the bullet and taking the money out. However, I would definitely not advise them to take this major step just based on this simple calculation. Many other factors are relevant (e.g., taxes when selling the existing investment to buy the index fund, how much of their savings was this $300,000). Also, I don't know anything about how investment works in Hong Kong, so there could be some wrinkles that modify or invalidate this simple calculation. But it is a starting point. Based on what you say here, I'd say they should take the earliest opportunity to tell everyone they know never to work with this investment manager. I would go so far as to say they should look at his credentials (e.g., see what kind of financial advisor certification he has, if any), look up the ethical standards of their issuers, and consider filing a complaint. This is not because of the performance of the investments -- losing 25% of your money due to market swings is a risk you have to accept -- but because of the exorbitant fees. Unless Hong Kong has got some crazy kind of investment management market, charging 1.5% quarterly is highway robbery; charging a 25%+ for withdrawal is pillage. Personally, I would seriously consider withdrawing the money even if the manager's investments had outperformed the market." }, { "docid": "414735", "title": "", "text": "Most of them still pay partial taxes, albeit not all of those are federal. Boeing and GE might be the worst offenders ethically as they are federal contractors who also benefit from US agreements with other countries that grant additional sales for the two firms' military hardware." }, { "docid": "338050", "title": "", "text": "You win, you are more pedantic than me. I give up. Edit: okay, I think I can be more pedantic than you here actually. Corporations don't even have to follow the law as long as their revenue from breaking the law is greater than the consequences of breaking said law. Ethics come from proper regulation." }, { "docid": "507368", "title": "", "text": "\"I like Muro questions! No, I don't think they do. Because for me, as a personal finance investor type just trying to save for retirement, they mean nothing. If I cannot tell what the basic business model of a company is, and how that business model is profitable and makes money, then that is a \"\"no buy\"\" for me. If I do understand it, they I can do some more looking into the stock and company and see if I want to purchase. I buy index funds that are indexes of industries and companies I can understand. I let a fund manager worry about the details, but I get myself in the right ballpark and I use a simple logic test to get there, not the word of a rating agency. If belong in the system as a whole, I could not really say. I could not possibly do the level of accounting research and other investigation that rating agencies do, so even if the business model is sound I might lose an investment because the company is not an ethical one. Again, that is the job of my fund manager to determine. Furthermore and I mitigate that risk by buying indexes instead of individual stock.\"" }, { "docid": "49627", "title": "", "text": "Speaking as a CFA charter holder in an alternative asset class, the CFA designation is beneficial to any role in finance. Not only does it provide a framework for understanding economics, accounting, financial instruments and markets, etc, the real value to me, is the signal it provides to others. For me, the CFA signals a level of intellectual sophistication and work ethic that employers, prospects, etc. Maybe asset management jobs aren't as in demand as previously, but I'm sure a CFA charter holder has a better chance of finding a retaining that role" }, { "docid": "423355", "title": "", "text": "That seems unrealistic given his history of supporting corruption and ethics breaches. He was warned about corruption, ethical, and loyalty concerns for a bunch of his cabinet and he brought them on anyway. These people did not get outed by trump, they abandoned him because he is a petulent, poorly performing, and all around unstable executive. He cant even respond to domestic terrorism in any acceptable way." }, { "docid": "44563", "title": "", "text": "Yes, work ethic is the key element. I too hate to be negative but they have taken me on a couple run-a-rounds that were not pleasant. The key is to micro-manage in an open room in cross-functional teams. The right hand feeds the left. Treating them like Americans works w/o raising salary by taking them to strip clubs or other entertainment that stimulates. But it's not easy." }, { "docid": "552604", "title": "", "text": "Honestly? Literally anything else. The same way budgets have been done since the dawn of time. If you have a mandatory expense (livable wage because we're prioritizing human life over discretionary spending because ethics) you trim the fat from other areas to make it work." }, { "docid": "507371", "title": "", "text": "If you sell counterfeit goods by claiming that they are real, you're no better than people that just straight up steal money without the pretense of 'business' If you sell counterfeit goods and acknowledge that they are counterfeit, you're in ethically better territory... but you're still taking an enormous legal risk that can't possibly be worth your middling profits." }, { "docid": "538361", "title": "", "text": "\"To be honest, why haven't startups taken advantage of Uber's shitty image to launch \"\"ethical\"\" uber taxi services? I love Uber's service, but i'd be ready to pay 50% extra on a ride if i know the drivers are paid right and the company holds a good vision.\"" }, { "docid": "400103", "title": "", "text": "Stated preferences vs. revealed preferences. People say they are willing to buy American, support mom and pop shops, buy higher quality goods, be ethical consumers, etc. until it comes down to actually paying for them, when most people will end up choosing based on price." }, { "docid": "471474", "title": "", "text": "Any system of social organization that sees enough generational poverty that people like yourself are advocating that others don't have the moral right to procreate is an abject failure. If you don't see that, then there's no point in discussion. You can look down your nose and lecture 'responsibility' to poor people all you want, but you're only revealing an abhorrent lack of ethics and compassion on your part and a dismal failure of our economic system as a whole." }, { "docid": "398823", "title": "", "text": "\"&gt; Because something is legal doesn't make it the ethical choice. &gt; &gt; You fail to demonstrate what is unethical about minimizing tax burdens. Operating in a country that allows you to make profit, in my opinion, establishes a duty to pay one's fair share of taxes. Paying legislators to make laws enabling tax avoidance is, in my mind, unethical. Clearly we have a different idea of what is ethical and not. &gt; corporations making huge profits using the infrastructure of the region &gt; &gt;Did the corporations have an option to refuse using that infrastructure, and instead provide their own or work with others to develop a competing infrastructure? Yes. &gt; Keep in mind that these favorable tax laws were lobbied by corporations with the intent to avoid taxes in mind. &gt;&gt;You have failed to support any argument that there is anything wrong with minimizing tax burden. That's like your opinion man. I don't think minimizing taxes by paying off legislators is equitable...call me crazy. &gt;If I'm walking behind someone and they happen to drop a $100 bill without noticing, I can certainly pick it up and put it in my pocket legally, but its hardly the moral thing to do. &gt;&gt;A more relevant example is if I order a pizza, have it sent to your house, then show up later with a bill for the pizza and my costs to send it to you, demanding you pay it. You never asked for the pizza, maybe you didn't want the pizza, maybe you didn't eat the pizza, maybe you don't like pizza, or don't like that kind of pizza. That I choose to send you a pizza does not obligate you to pay for that pizza. Lost me on this one bro...I thought we were talking ethics...not surprise pizzas. How about this one: I go to your house, use your kitchen and ingredients to make a pizza, sell the pizza for a profit and give you nothing even though we had an agreement that if I could make a profit I would give you some. However, I decide to talk to your roommate and give him a measly dollar to say \"\"forget about it bro...I said it's cool\"\".\"" } ]

[ { "docid": "305097", "title": "", "text": "Peer to peer lending such as Kiva, Lending Club, Funding Circle(small business), SoFi(student loans), Prosper, and various other services provide you with access to the 'basic form' of investing you described in your question. Other funds: You may find the documentary '97% Owned' fascinating as it provides an overview of the monetary system of England, with parallels to US, showing only 3% of money supply is used in exchange of goods and services, 97% is engaged in some form of speculation. If speculative activities are of concern, you may need to denounce many forms of currency. Lastly, be careful of taking the term addiction too lightly and deeming something unethical too quickly. You may be surprised to learn there are many people like yourself working at 'unethical' companies changing them within." } ]

[ { "docid": "9055", "title": "", "text": "Drugs, and medicine in general, are most certainly not inelastic. There is competition from less expensive analogs, and, unfortunately, nothing. There is always an optimum price as long as there is a marketplace. If we want cheaper drugs then we ought to reform patents (in a real sense) and lower barriers to competition. Medical companies are obviously lowering their ethical safeguards for selling drugs cheap when they don't have to so that can't be relied upon anymore." }, { "docid": "270994", "title": "", "text": "\"I'm surprised at the tone of the answers to this question! Trading with insider information is corruption and encourages fraud. As in many areas, there's an ethical line where behavior the gap between \"\"ok\"\" and \"\"illegal\"\" or unethical is thin. The classic local government insider information example is when the local councilman finds out that a highway exit is being constructed in an area that consists mostly of farmland. Knowing this, he buys out the farmers at what they think is a premium, and turns around for 10x profit a few months later. In that context, do you think that the councilman acting on that insider information is committing a crime or ethical lapse? Most people say yes. Even in this case, the line is thin. If the same councilman has his finger on the pulse of growth patterns in the area, and realizes that the terrain makes a certain area a prime candiate for a highway and exit, buying up land would not be criminal -- but it would be risky as it creates a perception that he is abusing his position.\"" }, { "docid": "509552", "title": "", "text": "You make some very valid points. However, does the state spend the money because they are incompetent; or, because that is how the state is structured to be? If the latter; then, by whom? Why do you think we start wars that a five year old could even understand is a sham? Why do we have overcrowded prisons? Follow the money.... Remember, the rich stay rich not because of their morals, ethics, or good behavior." }, { "docid": "361783", "title": "", "text": "\"Of course there can always be _some_ ways you can integrate some amounts of social responsibility into product, but I don't think that's the point he's making. Social responsibility would be called \"\"business best practice\"\" if it improved the bottom line. It is inevitable that there are times when social responsibility and business goals diverge, and at that point given two companies that are in the same market space, the one who bets against society will win. This is the sort of thing that _must_ be handled in law, and absolutely cannot be handled by allowing the free market to work because the free market will not discover ethics, it will discover that ethics don't matter in an environment that doesn't require them. It's the reason any claim that business does best when there are no regulations is absolutely false. If a company can make more by polluting and you don't have regulation that says clearly \"\"it may cost more, but we require you to compete by also being non-pollutiong\"\", then you should expect the market to converge on pollution as \"\"best practice\"\". Removing regulation won't allow business to sort this out, it will allow business to not care that they are polluting. There is the notion of a B-corp that is organized for the purpose of trying to be good guys without being sued. but it doesn't assure that they will have a fair stake int he market. It just allows them to fail without getting sued by stock holders. Basically if everyone is not required to be that level of good guy, though, B-corps are basically indulging unilateral disarmament. Sure, they can make a case that ethics matter, and that might work, but they don't need B-corp protection for that. If making the case that ethics matter was going to win in the market, any corporation could do it. For more thoughts, so I don't have to drone on here, see my articles [Fiduciary Duty vs. The Three Laws of Robotics](http://netsettlement.blogspot.com/2009/02/fiduciary-duty-vs-three-laws-of-robotics.html) and [Losing the War in a Quiet Room](http://netsettlement.blogspot.com/2012/01/losing-war-in-quiet-room.html).\"" }, { "docid": "348092", "title": "", "text": "\"Two possibilities that I can think of: 1) They recognize that it is stealing and just choose to do it anyway because of the unlikelihood of getting caught or punished. 2) They see an ethical distinction between stealing and \"\"gaming the system\"\" wherein if the store opens up a loophole it is not wrong to exploit it. EDIT: Note that these are just my theories for the motivations of the people who are participating in this, my own personal opinions are not necessarily reflected in this post.\"" }, { "docid": "441568", "title": "", "text": "manage the company properly. If you aren't much aware about company rules and regulation or tax matters, get an accountant so that you don't mess up later. better off paying my self a dividend of 100% profit or as an employee? That depends on how much salary you intend to pay yourself, your dividend or how much business expenses you will incur while running the business. Generally speaking you are better off paying your self a minimum salary and pay the rest as dividends. But check out the dividend tax and the income tax you might need to pay and compare which situation you are better off. If you have a partner, using the dividend way will reduce your NI outgoes. ethical and legal? Ethically the dividend way might burn your conscience but it is perfectly legal way of doing things." }, { "docid": "442306", "title": "", "text": "I'm not talking about the CFA, I'm talking about the entire finance industry, ethics make it all possible. Ethics provides room for trust between entities inside and outside the industry. Think about it, if you are a small cap private company wanting to go public, you **trust** that the underwriter will pay equity holders fairly for their units of equity. If there is no trust in the price, then there will be no underwriting, and no IPO for a new stock to enter the public markets. If there is no trust between fund managers and financial reports, the. There is no trust in estimated prospects and everything will be shriveled into speculative dangerous zones of future uncertainty. There's always a difference between being genuinely wrong and being a liar. TL;DR industry wide standards of ethics builds a foundation for trust which everyone uses directly or indirectly in finance." }, { "docid": "501024", "title": "", "text": "I do not think it is work ethic. I think the issue is people just do not have a choice but to do whatever their employer wants. If everyone was say rich then they could just tell their employer to F*** Off. Or if the USA had a strong economic safety net then people could tell their boss to F*** Off. But since the USA does not then the people are just wage slaves. I think the work ethic in other countries is more extreme than the USA but those nations people do tell their employer to get lost." }, { "docid": "368482", "title": "", "text": "\"This is a legal issue, or possibly an ethical issue, and not really a finance issue. And I am not a lawyer. But for what it's worth: Did you sign a written contract with H&R Block? If so, then the terms of that contract would govern. If you signed a contract saying that you agree to file your taxes through them if they meet such-and-such conditions, and they met these conditions, then you are legally obligated. If there was no written contract, then I think any court would take the conversation between you and H&R Block as an oral contract. If H&R Block said, basically, \"\"Okay, we'll calculate what we think your taxes are, and if we come up with something better than what you had before, then you agree to file your taxes through us\"\", and you said \"\"Oh, okay\"\", then that's an oral contract. You agreed to their conditions. Legally, oral contracts are just as binding as written contracts. The only difference is that it is difficult to prove exactly what was said. If you really did agree to these conditions, I suppose you could lie and say you didn't and then try to convince a court that they are the ones lying. Obvious ethical problems there. There are also implied contracts. If HRB's advertising or paperwork says that you're agreeing to file through them if they meet the conditions, I thing that a court would likely rule that you implicitly agreed to their terms by doing the review. In any case, when you go to some place like HRB mostly what you are paying for is their knowledge and expertise. So if they give you the benefit of their expertise -- they tell you how to reduce your taxes -- and then you don't pay them, that seems rather unethical to me. The situation is muddied by the fact that you paid $100 for the review. Is that paying for the basic information, the \"\"tax tip\"\", and paying for them to file is then a contract for additional work? Under some circumstances I'd say yes, that's additional work and thus an additional contract, so in the absence of a contract obligating me, I don't have to do that. The catch in this case is that at that point they must have already pretty much taken all your information and filled out all the forms. All that's left is to press the \"\"send\"\" button and submit the return, right?\"" }, { "docid": "272162", "title": "", "text": "\"Shariah compliant investments attempt to achieve your \"\"ethical investing\"\" ideals. Many countries around the world have a long list of shariah compliant investments and lots of journalists will go great lengths to reveal when a company is not really shariah compliant. Standard & Poors (S&P), an American financial services company, hosts a Shariah compliant index too, but on the Toronto Stock Exchange in Canada due to the Islamaphobia rampant in the United States. But of course, international companies are indifferent to any single country's social problems, and in your new pastime as an international speculator you will get the same luxury too and exemption from the political spectrum. S&P/TSX 60 information can be found here: http://web.tmxmoney.com/tmx_indices.php?section=tsx&index=%5ETXSI Business sectors prohibited from the Shariah index include: Gambling, Pornography, Tobacco, amongst others. In the United States, the concept has been renamed \"\"B-Corporation\"\" (a play on the federal term C-Corporation and S-Corporation), and has garnered enough of a movement that several states have created these as entities people can actually register them with the state, but these are not recognized as \"\"B-Corporations\"\" to the federal government. Shariah compliant investments will be easier to find worldwide, due to the popularity of the associated religion.\"" }, { "docid": "114527", "title": "", "text": "Context: assessed project as part of a tech internship in an investment bank, working in small groups, task: to design an app using a financial solution that has an ethical impact. We came up with (what I hope) is the smart sounding idea of an app for impoverished farmers in developing countries who lack the information and market access that larger or unionised farmers would have. The app would use some kind of decision tree (which may grow with machine learning) to assess the best kind of crops to grow given the region and local conditions for max profitability, and would provide access to some kind of derivatives market, and insurance, allowing the farmers a consistent income. Struggling with the specifics of how the business/finance side of things would work. Let's assume the bank builds the app and puts it on the app-store as part of some charitable initiative. 1) Would the farmers go directly to the bank to price and purchase derivatives on their crops? 2) Options/futures/forwards - which is most appropriate, or would it make sense to offer all three? 3) Is there any way this could be adjusted to provide regular payments, with a lump sum at the end? Would this be something the bank chooses to do, or is there an existing financial instrument for this kind of setup? 4) How does this tie in with the commodities markets (or is that what the derivatives already are?) 5) Probably a long-shot but any chance of know-your-customer implementations for countries with terrible infrastructure? 6) (probably a dumb question) Say the farmer sells an option on his crops, would this be sold directly to the bank or a 3rd party who'd be more interested in actually buying the crop? Or is this a far too simplistic view? Basically who would the farmer actually deliver the crops to? 7) Any other issues/oversights? Any ideas to make this sound somewhat viable? It doesn't have to strictly be realistic in any sense, but it also can't be flat-out incorrect! tyvm in advance, edited to make questions clearer" }, { "docid": "47946", "title": "", "text": "I think the main question is whether the 1.5% quarterly fee is so bad that it warrants losing $60,000 immediately. Suppose they pull it out now, so they have 220000 - 60000 = $160,000. They then invest this in a low-cost index fund, earning say 6% per year on average over 10 years. The result: Alternatively, they leave the $220,000 in but tell the manager to invest it in the same index fund now. They earn nothing because the manager's rapacious fees eat up all the gains (4*1.5% = 6%, not perfectly accurate due to compounding but close enough since 6% is only an estimate anyway). The result: the same $220,000 they started with. This back-of-the-envelope calculation suggests they will actually come out ahead by biting the bullet and taking the money out. However, I would definitely not advise them to take this major step just based on this simple calculation. Many other factors are relevant (e.g., taxes when selling the existing investment to buy the index fund, how much of their savings was this $300,000). Also, I don't know anything about how investment works in Hong Kong, so there could be some wrinkles that modify or invalidate this simple calculation. But it is a starting point. Based on what you say here, I'd say they should take the earliest opportunity to tell everyone they know never to work with this investment manager. I would go so far as to say they should look at his credentials (e.g., see what kind of financial advisor certification he has, if any), look up the ethical standards of their issuers, and consider filing a complaint. This is not because of the performance of the investments -- losing 25% of your money due to market swings is a risk you have to accept -- but because of the exorbitant fees. Unless Hong Kong has got some crazy kind of investment management market, charging 1.5% quarterly is highway robbery; charging a 25%+ for withdrawal is pillage. Personally, I would seriously consider withdrawing the money even if the manager's investments had outperformed the market." }, { "docid": "318986", "title": "", "text": "\"We're not \"\"helping\"\" the company in a comparable sense to donating money to a non-profit. As you wrote, investing in a company deals with ownership and in a sense, becoming a part owner of a company, even if it is a minor ownership, indicates that we sense it has some sort of value, whether that's ethical, financial or tangible value. As investors, we should take responsibility and ensure that our voices are heard when voting occurs (sadly, not too common). EDIT: @thepassiveinvestor makes an excellent point that this paragraph only applies to IPOs: Keep in mind, when we purchase stock in a company, that money is used for business purposes. It also signals value to the market as well, if enough money or enough investors buy the stock.\"" }, { "docid": "597683", "title": "", "text": "&gt; just allow injured parties to sue for damages! The legal system isn't based on ethics or morals, it's based on who can make the best argument. Big business' have a lot more resources and lawyers than you or I could ever hope to have." }, { "docid": "414735", "title": "", "text": "Most of them still pay partial taxes, albeit not all of those are federal. Boeing and GE might be the worst offenders ethically as they are federal contractors who also benefit from US agreements with other countries that grant additional sales for the two firms' military hardware." }, { "docid": "71036", "title": "", "text": "\"(Ignoring any ethical considerations of defaulting on a mortgage obligation) If your credit score fell, future costs of borrowing would be greater, if you could borrow money at all. The true financial cost of these penalties would depend on your own intentions and circumstances. The value of a credit score cannot be quantified in any absolute sense because of these circumstances which will vary from person to person. Suppose a decision would result in your score falling from 700 to 600. As a result, a future car loan would cost something like 2% more in interest per year. Let's also suppose you would not be able to find a bank to give you money to buy a new home. The difficulties caused by this situation would depend on the person. Some people have no intention of taking out another mortgage or buying another car, and to them, a lowered credit score might make no difference. To others, it would be desirable to avoid these penalties. The value of credit score would be equal to how much you would be willing to pay in the present to avoid these future penalties. If you intend to borrow money in the near future, and somehow know how much more interest you will pay as a result of your lower score, then you could approximate the value of the credit drop by summing all of the additional interest costs discounted into the present. Something a little like this: Year's Additional Cost in Interest / (1 + Your Personal Opportunity Cost of Funds) ^ (Years in the future this extra interest will be paid). See time value of money explanation: Can you explain \"\"time value of money\"\" and \"\"compound interest\"\" and provide examples of each? It could also be the case that you miss out on valuable financial opportunities as a result which could be added to the present value of the credit score drop. For example, if the drop made you totally unable to purchase an investment property that would net you $10,000 in cash flows /year (which would yield cash flows immediately). The value of that investment would have been $10,000 / (1 + Your Personal Opportunity Cost of Funds). Since you would not be able to make that investment (in this example) as a result of the decreased score, the present value of the investment would be an opportunity cost of the lower score. There are other hard-to-quantify costs of low credit to consider as well, ranging from housing to employment to bragging rights. Hopefully this has helped :)\"" }, { "docid": "371747", "title": "", "text": "True, that Colleges remove the lowest common denominator of ability: students who get F in classes. If you have a degree, you are probably above average in your mental abilities. But when it comes to practical knowledge, personality needed for work and in the workplace, work ethics, etc, they are not very beneficial. Actually, all those topics, practical knowledge, personality, work ethics, etc are self-taught or skills you you are born with. Cannot be taught." }, { "docid": "400103", "title": "", "text": "Stated preferences vs. revealed preferences. People say they are willing to buy American, support mom and pop shops, buy higher quality goods, be ethical consumers, etc. until it comes down to actually paying for them, when most people will end up choosing based on price." }, { "docid": "105253", "title": "", "text": "The VP came into the restaurant I work at and I served him and a client. At the end he tipped me $10 on a $30 bill and left his card saying to call him if I'm interested in being his assistant. I don't think I did anything different than I would a normal table, but I guess he was impressed with my work ethic. the idea of working for someone who can appreciate my serving and see more potential is exactly the kind of person I'd like to work for." } ]

[ { "docid": "349502", "title": "", "text": "I believe the appropriate recourse in this scenario is to bring a court case for breach of contract. The 1p repricing issue has been admitted as an error out of scope of the purpose of the software." } ]

[ { "docid": "71543", "title": "", "text": "Sometimes hedging is used if you have a position and you feel the market is going against your position, so one would hedge that position in order to protect their capital and possible profits instead of closing the position and incurring capital gains tax. Personally if the market was going against a position I had open I would get out of that position and protect my capital/profits instead of using more capital to hedge against my position. I would rather take a profit and pay some capital gains tax than watch my profits turn into a loss or use up more capital to try and protect a bad position. Hedging can be useful in certain circumstances but I think if you feel the market is going against your position/s for the medium to long term you should just get out of your positions instead of hedging against them." }, { "docid": "345091", "title": "", "text": "You should ensure that your broker is a member of the Securities Investor Protection Corporation (SIPC). SIPC protects the cash and securities in your brokerage account much like the Federal Deposit Insurance Corporation (FDIC) protects bank deposits. Securities are protected with a limit of $500,000 USD. Cash is protected with a limit of $250,000 USD. It should be noted that SIPC does not protect investors against loss of value or bad advice. As far as having multiple brokerage accounts for security, I personally don’t think it’s necessary to have multiple accounts for that reason. Depending on account or transaction fees, it might not hurt to have multiple accounts. It can actually be beneficial to have multiple accounts so long as each account serves a purpose in your overall financial plan. For example, I have three brokerage accounts, each of which serves a specific purpose. One provides low cost stock and bond transactions, another provides superior market data, and the third provides low cost mutual fund transactions. If you’re worried about asset security, there are a few things you can do to protect yourself. I would recommend you begin by consulting a qualified financial advisor about your risk profile. You stated that a considerable portion of your total assets are in securities. Depending on your risk profile and the amount of your net worth held in securities, you might be better served by moving your money into lower risk asset classes. I’m not an attorney or a financial advisor. This is not legal advice or financial advice. You can and should consult your own attorney and financial advisor." }, { "docid": "554522", "title": "", "text": "I'll add this to what the other answers said: if you are a renter now, and the real estate you want to buy is a house to live in, then it may be worth it - in a currency devaluation, rent may increase faster than your income. If you pay cash for the home, you also have the added benefit of considerably reducing your monthly housing costs. This makes you more resilient to whatever the future may throw at you - a lower paying job, for instance, or high inflation that eats away at the value of your income. If you get a mortgage, then make sure to get a fixed interest rate. In this case, it protects you somewhat from high inflation because your mortgage payment stays the same, while what you would have had to pay in rent keeps going up an up. In both cases there is also taxes and insurance, of course. And those would go up with inflation. Finally, do make sure to purchase sensibly. A good rule of thumb on how much you can afford to pay for a home is 2.5x - 3.5x your annual income. I do realize that there are some areas where it's common for people to buy homes at a far greater multiple, but that doesn't mean it's a sensible thing to do. Also: I'll second what @sheegaon said; if you're really worried about the euro collapsing, it might give you some peace of mind to move some money into UK Gilts or US Treasuries. Just keep in mind that currencies do move against each other, so you'd see the euro value of those investments fluctuate all the time." }, { "docid": "108461", "title": "", "text": "Your best bet would be to find an independent Property and Casualty Insurance agent and buy through him/her. Insurance agents make a commission, yes - BUT - the cost to consumer is THE SAME whether you buy through an agent or through directly through the company. Any P&C agent would be happy to run your numbers for you and tell you what the cheapest deal is. Just make sure you find someone who writes for several different large insurers. Obviously, some P&C Insurance agents are slick salesy types, which can get annoying, but if you find someone nice, he or she can help you out at no cost to you (they are paid by the insurance company they place the business with). If you are straightforward with the agent about exactly what your needs, they can get you quotes quickly and save you a lot of time and hassle." }, { "docid": "94279", "title": "", "text": "It certainly is possible for a run on the bank to drive it into insolvency. And yes, if the bank makes some bad loans, it can magnify the problem. Generally, this does not happen, though. Remember that banks usually have lots of customers, and people are depositing money and making mortgage payments every day, so there is usually enough on-hand to cover average banking withdrawl activity, regardless of any bad loans they have outstanding. Banks have lots of historical data to know what the average withdrawl demands are for a given day. They also have risk models to predict the likelihood of their loans going into default. A bank will generally use this information to strike a healthy balance between profit-making activity (e.g. issuing loans), and satisfying its account holders. In the event of a major withdrawl demand, there are some protections in place to guard against insolvency. There are regulations that specify a Reserve Requirement. The bank must keep a certain amount of money on hand, so they can't take huge risks by loaning out too much money all at once. Regulators can tweak this requirement over time to reflect the current economic situation. If a bank does run into trouble, it can take out a short-term loan. Either from another bank, or from the central bank (e.g. the US Federal Reserve). Banks don't want to pay interest on loans any more than you do, so if they are regularly borrowing money, they will adjust thier cash reserves accordingly. If all else fails and the bank can't meet its obligations (e.g. the Fed loan fell through), the bank has an insurance policy to make sure the account holders get paid. In the US, this is what the FDIC is for. Worst case, the bank goes under, but your money is safe. These protections have worked pretty well for many decades. However, during the recent financial crisis, all three of these protections were under heavy strain. So, one of the things banking regulators did was to put the major banks through stress tests to make sure they could handle several bad financial events without collapsing. These tests showed that some banks didn't have enough money in reserve. (Not long after, banks started to increase fees and credit card rates to raise this additional capital.) Keep in mind that if banks were unable to use the deposited money (loan it out, invest it, etc), the current financial landscape would change considerably." }, { "docid": "396959", "title": "", "text": "Insurance is not health care. Insurance is a financial instrument designed to protect the insured from short term shocks caused by some calamity by spreading out the cost over time. Not covering someone with a pre-existing condition is similar to an car-insurance company refusing to pay for repairing a damaged car, where the damage was caused prior to obtaining insurance. Not to be rude but failure to understand that utterly simple basic financial concept is exactly the sort of willful ignorance I'm talking about. What you are interested in is 'justice'. Someone was harmed by a desease which is tragic for the individual, and in some sense 'cosmically unfair'. It isn't however the fault of the insurance company that the person didn't purchase a policy beforehand. It would in fact be unfair to existing policy holders if the insurance company pays such claims, as it would raise their rates to cover those who will now rationally choose not to get insurance until after they have a claim." }, { "docid": "334642", "title": "", "text": "Fair point. I think malpractice insurance is more to protect the patient than the doctor, even though the doctor pays the premiums The government requires it so they can't kill or injury a patient and then just declare bankruptcy without paying damages. If claims were allowed for negligence that insurer would be creating what's known as a moral hazard issue and there would essentially be nothing stopping corporations/executives from constantly screwing over the public. That insurer would be bankrupt in no time." }, { "docid": "405695", "title": "", "text": "In general, insurance is a net good for you when it covers catastrophic losses that you would otherwise be unable to properly pay for yourself. See more here: https://money.stackexchange.com/a/77570/44232. Of course, insurance is more valuable when the catastrophic event becomes more likely. The list of possible outcomes for this combination of expense + likelihood is below: 1) Unlikely event; minimal loss: Insurance has no value here; you will simply be giving money to the insurance company and never getting anything worthwhile in return. Example: insuring your car in Florida against hail damage. 2) Unlikely event; catastrophic loss: Insurance has some value; it is likely cheap to acquire due to unlikelihood of occurrence, and could reduce the possibility of unfortunate incidences from becoming life-altering. Example: insuring your car for an extra $1M liability insurance against possible medical expenses of those in an accident. 3) Likely event; minimal loss: Insurance has no value here - you will over the course of your life suffer many of these small losses, and by constantly paying insurance, you are on average losing money to the insurance companies. Example: insuring your toaster. 4) Likely event; catastrophic loss: While insurance would be valuable here, it is also going to be quite expensive. A better option may be to simply not participate in that activity. Example: insurance for participating in an unlicensed MMA fight. Your specific question refers to what I would classify as #2 above - an unlikely event, but a catastrophic loss. This implies that insurance may be worthwhile, depending on the price and payout. The price itself seems small in relation to the cost of a ticket, and the payout seems high in relation to the cost of the premium. But does the payout actually mean to you? It is perhaps not wise to consider life insurance as a 'windfall payment'. Instead, consider life insurance as coverage for the financial realities of death - funeral expenses, and perhaps money to provide grieving time for your family before they resume or take on work [Again, insurance is coverage against catastrophic loss, not a lottery ticket to provide a windfall when the unfortunate happens]. If you are the sole provider for your family, you may also want your insurance payout to be enough to resolve any outstanding debts you have outstanding [such as a mortgage], and/or substantially cover living expenses for your family for an extended period of time. A $20k payout would likely be far more than enough to cover funeral expenses, but may not be enough to set up your family to subsist without you as a sole provider. Also consider that the chance for an accident may not seem particularly concerning while you are on the train in comparison to when you are jaywalking, or smoking the odd cigar, eating red meat, having a glass of red wine. What I mean is that there are many things in life which add some level of risk; not all of them are as obvious as a train ride, but there is always a chance of something unfortunate happening, even if you take reasonable precautions. What these two considerations imply is that perhaps instead of insuring against this very specific incident, you instead purchase overall life insurance. Rather than taking a flat payout amount, take enough of a policy only to cover the specific needs you expect - for many people, this is defined by the amount needed to cover funeral expenses only + possibly their outstanding mortgage balance. If you take the train often, your annual insurance premiums for a full insurance plan may be similar to your 'train only' insurance, while covering you in a wider variety of circumstances. Many people hesitate to think about purchasing not only life insurance not only because of the cost, but also because they do not wish to dwell on their mortality. But facing the subject head on may provide you with both financial and emotional peace of mind. [And write up a will, while you're at it!]" }, { "docid": "281572", "title": "", "text": "That is where I think Walmart comes in to buy up a business like this. With their network of stores and the insane buying power they have the can push a good solid quality that the middle class American wants and do it very cheaply. I feel this will be their main combat against Amazon buying whole foods. Currently Walmart makes more on grocery sales than anything else as a hole and will continue to do so because of what and how they are doing it. Walmart is sneaky as fuck when it comes to what they can do and how they can do it. Even Walmart buying up Advanced Auto Parts is a solid counter move to Amazon buying Whole Foods...the next step is buying a Blue Apron type business... and with how Blue Apron is doing financially and given their name they are entering buy off territory. In my humble albeit non pro status in the stock market my 3 buys are Snap Chat, GoPro, and Walmart for long term retire and never have to worry about money again companies. I am by no means an expert but I have never come close to losing money in the stock market and do a good amount of research before I invest. Snapchat is my top 1 tbh. Sorry for going on a tangent lol" }, { "docid": "236082", "title": "", "text": "\"There are 2 maxims that help make sense of insurance: Following those 2 rules, \"\"normal\"\" insurance makes sense. Can't afford to replace your car? insure it. Can afford to lose your TV? Don't insure it. People with a net worth in the low millions have very similar insurance needs to the middle class. For example, they might be able to afford a new car when they total it, but they probably can't afford to pay for the long term care of the person they accidentally ran over. Similarly, they probably need to insure their million dollar house, just like average people insure more affordable housing. \"\"Very wealthy\"\" people still have the same basic choices, but for different assets. If you are a billionaire, then you might not bother to insure your $30k childhood home or your fleet vehicles, but you probably would insure your $250m mansion, your $100m yacht and your more pricey collectible cars. It's also worth noting that \"\"very wealthy\"\" people are at much higher risk of being sued for negligence or personal injury. As such, they are more likely to purchase personal liability or umbrella insurance coverage to protect against such risks. Multi-million-dollar personal injury suits would never be filed against a poorer person simply because they couldn't afford to pay even the plaintiff's lawyer fees when they lost the court case. Insurance also makes sense when the insurance company is likely to (grossly) underestimate the risk they are taking. For example, if I am a really bad driver, but i have a clean record thanks to my army of lawyers, then insurance might actually be a good deal for me even on average. To take the \"\"very wealthy\"\" stereotypes to the extreme, perhaps my eccentric billionaire neighbor and I are in an escalating feud which I think will result in my butler \"\"accidentally\"\" running his car into my neighbor's precious 1961 Ferrari.\"" }, { "docid": "479615", "title": "", "text": "Taxi regulations exist to protect the public. It's not some racket to keep people out of the market. Insurance: Uber/Lyft only insure their drivers while they are loaded. Meaning any other time they are driving around, even if they are driving to a call, they aren't insured. If they get in a wreck, their own car insurance won't cover it because they don't have taxi insurance which is a shit load more expensive than regular car insurance. Red-lining: Red-lining is where taxi companies will not server certain neighborhoods, meaning they will neither pick up nor drop off in the area. Discrimination: All classes are protected under taxi regulations with serious repercussions for discrimination. This also includes people with disabilities, like the blind and those in wheel chairs. Rates: Taxi rates are typically approved by the city so that companies can't constantly change them. This is a big one as far as Uber/Lyft goes. Really what it comes down to is Uber/Lyft need to operate on a level playing field. They are a taxi service. There is absolutely no question about this and it isn't up for dispute. They need to obey the same laws that taxi companies are still held to or be fined into oblivion. If you actually bother to read the taxi regs for your city, you will see they are there to protect you as a customer and have little benefit to taxi companies. About the only rule I can think of are the regulations regarding paying your fare. For all the rest, the taxi companies would be better off without because they wouldn't be forced to serve people they don't want to. In my experience, the cab companies don't care about additional competition because it's the nature of the business. The fact that Uber/Lyft completely disregard all the regulations is what they have a problem with. //Source: 8 years in the taxi industry." }, { "docid": "449096", "title": "", "text": "The word bespoke means made to order. Bespoke insurance means non-cookie cutter. That mean the thing your are trying to protect, or the risk to that item is not normally covered; so you need a non-standard type of policy. Your neighborhood insurance company doesn't handle a bespoke policy. There are companies that do. Reinsurance is insurance on insurance. Company X has a risk they want to insure, so they go to insurance company A. After a while insurance company A realizes that they have sold a few of these policies and they have a risk if they guessed wrong. So they take out a policy with insurance company B to protect themselves if more than some percentage of their policies go bad. That policy takes bespoke reinsurance." }, { "docid": "134279", "title": "", "text": "Everyone thinks this is so Amazon can keep you from comparison shopping while in an Amazon brick and mortar, but has anyone considered the other reason most companies patent things? Maybe they're trying to protect that so other companies, like best buy, can't use tech like that. I'm pretty sure Amazon benefits more from people looking stuff up at every other store in the world than they would from blocking you in their own store." }, { "docid": "307186", "title": "", "text": "FDIC insurance only protects certain funds, and is not meant to protect against losses in the market, or to guarantee every investment you might make. Generally, the only accounts that will be FDIC insured are savings, checking, money market and CDs." }, { "docid": "120935", "title": "", "text": "I politely decline. Insurance is there to protect me against catastrophic financial loss (huge medical bills, owing a mortgage on a house that burned down, etc.) not a way to game the system and pay for routine expenses or repairs." }, { "docid": "357427", "title": "", "text": "What do you mean doesn't allow private entities to attach to the fixtures? Do you mean fixtures like lamp posts etc? This would only be suitable for small cells anyway. Putting a small cell on a rooftop is silly. A roof site would be a full build site with radios, sector antennas, an equipment cabinet or two, and a power/battery cabinet. If you mean attach fixtures to buildings, I don't believe that. Create a business to lease the space. Bob's Rooftop, Inc., etc. Make sure they carry sufficient insurance and that it includes protection for your building against any contractor error (roof damage, accidentally drill something, damage to cosmetic materials, etc), against fire, and basically anything else. I've only seen cell equipment catch fire a couple of times, both of which were the result of lightning strikes. On the other hand, the bank of batteries they use for backup power is pretty big and has more than enough power to do some accidental arc welding. Are they limited to leasing to a single carrier? You need this all spelled out in writing. PM me the name of the vendor if you are allowed to. I don't need the name of the carrier. You don't need to give me too much identifying information, so there is no exposure for you. Are they offering the $350 or are you asking it? I feel like a minimum of $1000 is reasonable. Try to find out what they will be paid by the carrier. You might be able to negotiate something like 65% of the money the carrier pays. Do remember that the vendor does basically nothing other than make the space available. They don't build the site and they don't maintain it." }, { "docid": "223382", "title": "", "text": "\"Why would you give them the money and borrow it back? If you didn't give it to them in the first place you wouldn't need to borrow! It makes no sense at all. It USED to have a different use--as a tax dodge. You would buy \"\"life insurance\"\" for a low amount of coverage and way overfund it. Let the money grow and in your later years you would \"\"borrow\"\" against the extra value you had built up in the policy. Since this was a loan rather than a payout it wasn't income. When you died the tax liability went poof. Thus so long as what you had to pay in life insurance + the inefficiency of the insurance company was less than the tax rate it was a good deal. Congress closed this loophole a long time ago by prohibiting too great overfunding.\"" }, { "docid": "287398", "title": "", "text": "\"I would advise against \"\"pencil and paper\"\" approach for the following reasons: You should e-file instead of paper filing. Although the IRS provides an option of \"\"Fillable Forms\"\", there's no additional benefit there. Software ensures correctness of the calculations. It is easy to make math errors, lookup the wrong table It is easy to forget to fill a line or to click a checkbox (one particular checkbox on Schedule B cost many people thousands of dollars). Software ask you questions in a \"\"interview\"\" manner, and makes it harder to miss. Software can provide soft copies that you can retrieve later or reuse for amendments and carry-overs to the next year, making the task next time easier and quicker. You may not always know about all the available deductions and credits. Instead of researching the tax changes every year, just flow with the interview process of the software, and they'll suggest what may be available for you (lifetime learners credit? Who knows). Software provides some kind of liability protection (for example, if there's something wrong because the software had a bug - you can have them fix it for you and pay your penalties, if any). It's free. So why not use it? As to professional help later in life - depending on your needs. I'm fully capable of filling my own tax returns, for example, but I prefer to have a professional do it since I'm not always aware about all the intricacies of taxation of my transactions and prefer to have a professional counsel (who also provides some liability coverage if she counsels me wrong...). Some things may become very complex and many people are not aware of that (I've shared the things I learned here on this forum, but there are many things I'm not aware of and the tax professional should know).\"" }, { "docid": "100655", "title": "", "text": "\"If your meaning of \"\"asset protection\"\" is buying gold and canned food in the name of a Nevada LLC because some radio guy said so, bad idea. For a person, if you have assets, buy appropriate liability limits with your homeowner/renter insurance policy or purchase an \"\"umbrella\"\" liability policy. This type of insurance is cheap. If you don't have assets, it may not be worth the cost of insuring yourself beyond the default limits on your renter's or homeowner's policy. If you have a business, you need to talk to your insurance agent about what coverage is appropriate for the business as a whole vs. you personally. You also need to talk to your attorney about how to conduct yourself so that your business interests are separated from your personal interests.\"" } ]

[ { "docid": "584521", "title": "", "text": "Credit cards charge about 2% fee from merchants. This is already priced into the restaurant menu. Generally, dealing with cash will not cost the merchant significantly less since he needs to make more trips to the bank, pay fees for frequent cash deposits (banks charge per operation), and maintain a safe location for storage of that cash. Bottom line - I doubt it makes any significant difference to the restaurant owner." } ]

[ { "docid": "195726", "title": "", "text": "Hi, This is treated as a electronic balance transfer. There may be a fee for performing this. Cash advance interest will apply on the EBT. You may get a teaser rate for a limited amount of time. After it expires, the normal cash advance interest rate for the credit card will kick in. Check your credit card statement. Somewhere, you'll see a section listing the interest rates. One for retail purchases, one for cash transactions. Do not do this. If you need to borrow money to pay off a large debt, do one of the following: 1) Switch to the lowest interest rate card your bank offers 2) Apply for a credit card with another bank that is offering a great teaser rate, transfer the balance, cut your living expenses and send every penny to paying off the balance before the teaser rate expires 3) If you cannot get access new credit or switch credit cards, seek advice from a professional credit counsellor on your options and the best one to choose Sorry to ramble. I've seen far too many people fall into the debt trap. You don't want to go there. Source: I work for a bank which offers credit card products." }, { "docid": "164795", "title": "", "text": "I got a Capital One credit card because they don't charge a fee for transactions in foreign currencies. So I only use it when I travel abroad. At home, I use 3 different credit cards, each offering different types of rewards (cash back on gas, movies, restaurants, online shopping etc)." }, { "docid": "489561", "title": "", "text": "I have a car loan paid in full and even paid off early, and 2 personal loans paid in full from my credit union that don't seem to reflect in a positive way and all 3 were in good standing. But you also My credit card utilization is 95%. I have a total of 4 store credit cards, a car loan, 2 personal loans. So assuming no overlap, you've paid off three of your ten loans (30%). And you still have 95% utilization. What would you do if you were laid off for six months? Regardless of payment history, you would most likely stop making payments on your loans. This is why your credit score is bad. You are in fact a credit risk. Not due to payment history. If your payment history was bad, you'd likely rank worse. But simple fiscal reality is that you are an adverse event away from serious fiscal problems. For that matter, the very point that you are considering bankruptcy says that they are right to give you a poor score. Bankruptcy has adverse effects on you, but for your creditors it means that many of them will never get paid or get paid less than what they loaned. The hard advice that we can give is to reduce your expenses. Stop going to restaurants. Prepare breakfast and supper from scratch and bag your lunch. Don't put new expenses on your credit cards unless you can pay them this month. Cut up your store cards and don't shop for anything but necessities. Whatever durables (furniture, appliances, clothes, shoes, etc.) you have now should be enough for the next year or so. Cut your expenses. Have premium channels on your cable or the extra fast internet? Drop back to the minimum instead. Turn the heat down and the A/C temperature up (so it cools less). Turn off the lights if you aren't using them. If you move, move to a cheaper apartment. Nothing to do? Get a second job. That will not only keep you from being bored, it will help with your financial issues. Bankruptcy will not itself fix the problems you describe. You are living beyond your means. Bankruptcy might make you stop living beyond your means. But it won't fix the problem that you make less money than you want to spend. Only you can do that. Better to stop the spending now rather than waiting until bankruptcy makes your credit even worse and forces you to cut spending. If you have extra money at the end of the month, pick the worst loan and pay as much of it as you can. By worst, I mean the one with the worst terms going forward. Highest interest rate, etc. If two loans have the same rate, pay the smaller one first. Once you pay off that loan, it will increase the amount of money you have left to pay off your other loans. This is called the debt snowball (snowball effect). After you finish paying off your debt, save up six months worth of expenses or income. These will be your emergency savings. Once you have your emergency fund, write out a budget and stick to it. You can buy anything you want, so long as it fits in your budget. Avoid borrowing unless absolutely necessary. Instead, save your money for bigger purchases. With savings, you not only avoid paying interest, you may actually get paid interest. Even if it's a low rate, paid to you is better than paying someone else. One of the largest effects of bankruptcy is that it forces you to act like this. They offer you even less credit at worse terms. You won't be able to shop on credit anymore. No new car loan. No mortgage. No nice clothes on credit. So why declare bankruptcy? Take charge of your spending now rather than waiting until you can't do anything else." }, { "docid": "539610", "title": "", "text": "You have 3 assumptions about the use of credit cards for all your purchases: 1) May be a moot point. At current interest rates that will not make much of a difference. If somebody links their card to a checking account that doesn't pay any interest there will be no additional interest earned. If the rate on their account is <1% they may make a couple of dollars a month. 2) Make sure that the card delivers on the benefits you expect. Don't select a card with an annual fee. Cash is better than miles for most people. Also make sure the best earnings aren't from only shopping at one gas station or one store. You might not make as much as you expect. Especially if the gas station is generally the most expensive in the area. Sometimes the maximum cash back is only for a limited time, or only after you have charged thousands of dollars that year. 3) It can have a positive impact on your credit rating. I have also found that the use of the credit card does minimize the chances of accidentally overdrawing the linked account. There is only one big scheduled withdraw a month, instead of dozens of unscheduled ones. There is some evidence that by disconnecting the drop in balance from the purchase, people spend more. They say I am getting X% back, but then are shocked when they see the monthly bill." }, { "docid": "170494", "title": "", "text": "\"We *are* talking at cross-purposes, but not for the reason you think. The debt might or might not be legally or practically recoverable (the apple-farmer and everything he owns might have been destroyed in the fire), but the value created and destroyed was real, and so was the money. You're focusing on the debt owed to the shoemaker, which is fine, but your mistake is thinking that the debt is in some way meaningfully different from money, which it's not. Most people who try to explain this difference would go off on a spiel about how the overwhelming majority of money on deposit in banks and otherwise in circulation has never been printed, or something, which is okay, but it's not a very convincing argument because you'll come back with something like, \"\"But I can still withdraw all my money, I can still cash all my checks, etc...\"\" So instead, I'm going to try and break this down, bear with me... The apple-grower got a deer (worth 12 loddars, let's set the \"\"interest\"\" part aside for the moment). I got a pair shoes (also worth loddars). Forget about the shoe-maker and the debt for a moment, and focus on me. I sold a deer, and I used the proceeds to buy a pair of shoes. - Did I defraud anyone? No, I engaged in a fair transaction with willing partners on both sides. - Did I get paid for the deer? Obviously I did, because I used the payment to buy shoes. - What did I get paid with, if not money? I can hear you saying \"\"yeah, but the shoe guy...\"\" Forget about the shoe guy. When buy something on Amazon marketplace and charge it on a credit card and then get paid via direct-deposit and then have the money taken from your account to pay off the credit-card company electronically, is all of that real money? Of course it is. Now, what happens if you die before paying the the credit-card bill? Does that mean that the money Amazon paid to the seller doesn't exist? Does that mean that money paid by the CC company to Amazon doesn't exist? How about the money in your bank account, does that exist? What if your employer once defrauded someone, how about then? None of that money has ever been *printed*, nobody got permission from Ben Bernanke to authorize these transactions, but the money that changed hands was absolutely real, even though it was nothing more than a *series of promises.* Before you argue with me, think this through: all these account-transfers ultimately boil down to *promises* by the end bank to produce cash when and if the account-holder walks up to a teller and demands it. The bank doesn't have nearly enough cash to pay every account-holder, but they *do* have enough (hopefully) to keep their promises, since they know they won't all be called in at once. Nobody ever actually delivered a package of paper currency to cover these transactions. Everyone is just trading promises, and passing those promises along to others. It sounds crazy to say it that way, but it is *absolutely* true. Tally up your net worth (or if that's too ugly, imagine tallying up someone's net worth who has a net worth). Chances are that you have never in your life seen that amount of paper cash, certainly not in your physical possession. So who has it? It's not like your local bank branch has a box marked \"\"C_B_M\"\" with $400,000 in bills and coins sitting there. What you have is a series of promises. When your employer gets by credit-card, the customer promises to pay the credit-card company, who promises to pay your employer's bank. Your employer then pays you with a direct-deposit whereby his bank promises to pay your bank. You then swipe an ATM card and your bank promises to pay the grocery-store's bank, who in turn sends a check to their supplier which is a promise that the grocery-store's bank will pay the supplier's bank, who in turn does the same with the farmer, who does the same with his mortgage-company, who does the same to their investors, who do the same to whoever they spend money with. Occasionally one of them takes a cash withdrawal to tip the stripper or stick in a birthday-card or buy hot-dogs at the ballpark or something, but overwhelmingly, we are all just spending and re-spending *promises*, and the remarkable thing is that, overwhelmingly, *we keep them*, without anyone involved ever hiring a truck to deliver a bindle of cash to the \"\"first person\"\" because there *is* no \"\"first person.\"\" All of that stuff is *absolutely real money*. I used the example of a wildfire, but maybe it will be more useful to think of something that just changes in value for no obvious reason. Think of some article of clothing that has gone out of style-- everyone was buying that stuff up until the day they stopped. Somewhere, someone was stuck with the last warehouse full of hot-pink parachute pants or whatever. A month before, when they were ordered from China or wherever, they were worth $50 each. Now you can't give them away. That value is gone, it's just vanished. The money that bought the pants was real, the pants are real, but they are no longer worth anything. The person holding that warehouse full of pants now has to *pay* to either store of dispose of them. They might start bouncing checks and breaking promises. There was no fraud, but there also might not be any way to recover the money owed. $10mm worth of parachute pants is now negative $1mm worth of trash that has to be disposed of and mortgage obligations on the warehouse. I hope some of that makes sense. It is really hard to explain this stuff via analogy and hypothetical and the kinds of terms that lawyers think in, if you will forgive me for saying so.\"" }, { "docid": "25205", "title": "", "text": "The answer today is the Fidelity Rewards Amex. This card pays the highest cash back (2%) on ALL purchases. The answer gets more complicated if you like miles, or you want to use one card for groceries and gas and another for restaurants, etc. But the Fidelity Amex gives you 2% on everything you purchase, automatically deposited into your Fidelity account as cash (no coupons to rip off, or checks to deposit)." }, { "docid": "369996", "title": "", "text": "\"You want to know if you should pay cash or use a credit card like cash? There are so many benefits to the card, like purchase protection, cash back, and postponed payments, that there needs to be a really good reason to pay cash. If you are concerned about the 10% threshold, ask your credit card company to raise your limit. If you are indifferent, let the merchant decide for you by asking for a discount if you pay cash. The biggest reason is that credit cards, when handled shrewdly, make your money work for you by keeping it in less liquid / higher interest investments like inflation-adjusted T-bills. You will still be able to access it by using the credit card to float large expenses without liquidating at a loss. Investment Accounts like Schwab One are great for this since you can \"\"borrow\"\" cash at a low interest rate against your securities, until your security sale clears.\"" }, { "docid": "180673", "title": "", "text": "I don't think there's any law against having lots of bank accounts. But what are you really gaining? Every new account is a paperwork hassle. Every new account is another target for con men who might steal your information and write bad checks or make phony credit card purchases in your name. Yes, it's not unreasonable to have a credit card or two that you keep for emergencies. I'd advise anyone with running up debts while having no idea how you will pay them off. But to say that you might keep some credit available so that if you have a legitimate emergency -- like, say, your car breaks down and you don't have the cash to fix it and you can't get to work without it -- you have some a fallback. But do you really need ten credit cards for that sort of thing? And how much credit are they giving you on each card? I don't know how the banks work this, but I'd think if they're rational, they'd consider your total credit before giving you more. I have three credit cards that I use regularly -- two personal and one business. And I find that a real pain to keep track of, to make sure that I keep each one paid by the due date and to keep a handle on how much I owe and so forth. I can't imagine trying to deal with ten. I suppose you could just stuff all these cards in a drawer and only use them in case of emergency." }, { "docid": "106448", "title": "", "text": "If it's feasible, try to get one card down to zero balance, and preferably one of your cash-back cards. Then keep that at zero every month (pay it off in full), and use it for your purchases as you describe above. The idea would be to get it so that you are not paying interest on your month to month purchases. This not only reduces the 20% or whatever that you're paying on that balance, but also the 20% or whatever you're paying on those purchases - remember, a card you carry a balance on charges you interest on those purchases from the current month. If this isn't feasible (if these are all very high balance cards), then I suppose the way you're currently doing it would be okay, though I think you're overthinking things to some extent - but with 80% interest, if that's a significant pile of money, you may need to as clearly that needs to be tackled first. I think it's mostly better for you to pay your day to day stuff out of pocket and not use your cards the way you are suggesting, but with the 80% loan(s) you may need to. The reason I say it's better not to use your card the way you suggest is that it is difficult to do properly and never get it wrong (i.e., never go over a balance), and it's also leaving you in the habit of using credit. It doesn't help you budget necessarily, either. Instead, set up a fully developed budget that includes all of those minimum payments and pay them. Certainly once you have the > 50% debt handled, I would switch to this method (not using credit cards at all)." }, { "docid": "76248", "title": "", "text": "First, before we talk about anything having to do with the credit score, we need the disclaimer that the exact credit score formulas are proprietary secrets that have not been revealed. Therefore, all we have to go on are broad generalities that FICO has given us. That having been said, the credit card debt utilization portion of your score generally has at least two components: an overall utilization, and a per-card utilization. Your overall utilization is taken by adding up all your credit card debt and all your credit limits and dividing. Using your numbers above, you are sitting at about 95%. The per-card utilization is the individual utilization of each card. Your five cards range in utilization from 69% to 100%. Paying one card over another has no affect on your overall utilization, but obviously will change the per-card utilization of the one you pay first. So, to your question: Is it better on the credit score to have one low-util card and one high-util card, or to have two medium-util cards? I haven't read anything that definitively answers this question. Here is my advice to you: The big problem you have is the debt, not the credit score. Your credit card debt should be treated like an emergency that needs to be taken care of as quickly as you possibly can. Instead of trying to optimize your credit score, you should be trying to minimize the number of days until all of your credit cards are completely paid off. The credit score will take care of itself once you get your financial situation back on track. There is debate about the order in which one should pay off their debts, but the fact of the matter is that the order is not as significant as the intensity at which you pay them all off. Dedicate yourself to getting rid of the debts as fast as possible, and it won't matter much which order they get paid off in. Finally, to answer your question, I recommend that you attack the card debt one at a time instead of trying to pay them off evenly. Not because it will optimize your credit score, but because it will help you focus your debt-reduction energy as you work on resolving your debt emergency. Fortunately, the credit utilization portion of the credit score has no history, so once you pay all of these off, the utilization portion of your score will get better immediately, and the path you took to get there will be irrelevant. After the credit cards are completely paid off, and you have resolved never to spend money that you don't have again, it is time to work on the student loans...." }, { "docid": "9814", "title": "", "text": "\"Ever wonder why certain businesses won't accept certain credit cards? (The sign above the register saying \"\"Sorry, we don't accept AmericanExpress\"\"). It's because they don't want to pay that credit card company's transaction fees. One of the roles of the credit card company is to facilitate the transaction process between the customer (you) and the store. And now that using credit cards over cash or check is so ingrained in our culture, it creates extra work for the customer to make purchases at an establishment that is cash-only. Credit card companies know this, and so do businesses. So businesses will partner with credit card companies so that customers can use their cards. This way, everything is handled electronically (this can also benefit the business, since there's added security as they're not dealing with cash directly, and they don't have to manually count as much cash later). However a business may only budget a certain amount of their profits they want taken by credit card transactions. So if a company's fees are too high (say AmericanExpress, for example) and they are banking on you already having a Visa card, the company isn't going to go out of its way to provide the AmericanExpress option for you. If it were free for the business to use a credit card company's service at their stores, then they would all just provide the option for every card! So the credit card company making money is all contingent on you spending your money by using their credit card. You use the card, and the store pays the company for the transaction.\"" }, { "docid": "121233", "title": "", "text": "A few things for you to consider: (1) Yes, if your average daily balance is lower [because you paid it off when you received your paycheck, then slowly used the card for the remainder of the month, until it's at the same balance next paycheck, vs just having the card at a flat $5k the whole month], you will accrue less interest, thereby allowing you to pay it off faster by reducing your interest payments. BUT: (2) Carrying a balance on your credit card is a big financial no-no, and eliminating it should be an immediate priority for you. If there is anything you can do (step 1: budget your expenses and then track actuals to see where you stand - step 2: see what expenses you can reduce - step 3: see if you can increase your income - step 4: rebudget with your new goals, determine how long it would take to pay off the card, possibly considering consolidating/refinancing your debt at a lower interest rate) to pay it off faster, then do it. However (3) If you have absolutely zero cash on hand, then taking your paycheck and immediately paying down your credit card, and then relying on that card to pay for things until the next paycheck, puts you at risk of your available credit changing. ie: if you have 5k on the card, and pay it down to 4.25k, then what happens to you if the credit card company [because they view you as a risk, or for whatever other reason - including a temporary hold because of fraudulent activity at no fault of your own] reduces your available credit to 4.5k? Suddenly, you will only have $250 in available spending power until your next paycheck. Therefore it may be wise for you to hold onto some amount of cash that you do not touch except for emergencies, even before you pay off your credit card. I really recommend you search this site for other questions related to budgeting and credit cards. There are many good answers, and some of what I've said above is just opinion, so you shouldn't just take my word for it, you should try to become familiar with these topics yourself. Good luck!" }, { "docid": "304006", "title": "", "text": "You said: Use a credit card (to get my 3% Cash back) to withdraw cash ... Then you said: Is there any way to do this without paying a cash advance fee (or any fees in general)? Right there you have stated the inconsistency. Withdrawing cash using a credit card is a cash advance. You may or may not be charged a fee for doing the cash advance, but no credit card will offer you cash back on a cash advance, so you can't earn your 3% by using cash advances. As others have mentioned, you can sometimes get close by using the card to purchase things that are almost like cash, such as gift cards. But you have to make a purchase." }, { "docid": "566598", "title": "", "text": "\"Most credit cards allow you to take \"\"cash advances\"\", but the fees and limits for cash advances are different than for regular purchases. You can buy stock after taking a cash advance from your credit card. When you make a cash advance, you normally pay the credit card company a fee. When you make a regular purchase, the merchant (ie, the stockbroker) pays a fee. Additionally, credit card companies can make merchants wait up to 3 months to actually receive the money, in case the transaction is disputed. Your stockbroker is unlikely to want to pay the fee, accept the delay in receiving the funds, and risking that you will dispute the transaction. Having said that, many FOREX brokers will accept credit card deposits (treated as purchases), although FOREX can be considerably riskier than the stock market. Of course, if you max out your credit cards and lose all your money, you can normally negotiate to pay back the debt for less than the original amount, especially since it's unsecured debt.\"" }, { "docid": "330049", "title": "", "text": "I am like you with not acknowledging balances in my accounts, so I pay my credit card early and often. Much more than once a month. With my banks bill pay, I can send money to the credit card for free and at any time. I pay it every two weeks (when I get paid), and I will put other extra payments on there if I bought a large item. It helps me keep my balances based in reality in Quicken. For example, I saved the cash for my trip, put the trip on my credit card, then paid it all off the day after I got home. I used the card because I didn't want to carry the cash, I wanted the rewards cash back, I wanted the automatic protection on the car rental, and I couldn't pay for a hotel with cash. There are many good reasons to use credit cards, but only if you can avoid carrying a balance." }, { "docid": "277161", "title": "", "text": "You had to lie because you wanted to keep more of it. As the person in the article said a good server at a good restaurant should make at least $20 an hour on top of the minimum wage. Plus I never claimed any tips besides credit card tips. All the cash tips went unreported." }, { "docid": "11936", "title": "", "text": "\"What you have is usually called a pre-paid credit card. You pay some money (Indian Rupees) to the credit card company, and then you can use the card to pay for purchases etc in foreign (non-Indian) currencies upto the remaining balance on the card. If a proposed charge exceeds the remaining balance, the transaction will be declined when you try to use the card. There might be multiple ways that the card is set up, e.g. it might be restricted to charge purchases denominated in US dollars alone, or you might be able to use it anywhere in the world (except India). The balance on the card might be denominated in INR, or in US$, say. In the latter case, the exchange rate at which your INR payment was converted into the $US balance is fixed and agreed to at the time of the original payment: you paid INR 70K (say) and the balance was set to US$ 1000 even though the exchange rate on the open market would have given you a few more US dollars. In the former case with the balance denominated in INR, a charge of US$ 100, say, would be converted to INR at a fixed agreed-upon rate, or at the current exchange rate that the Visa or MasterCard network is using, plus (typically) a 3% fee currency exchange fee, and your balance in INR will decrease accordingly. With all that as prologue, if you made a purchase from Walmart USA and later returned it for a credit, it should increase your credit card balance appropriately. You may be whacked with currency conversion fees along the way depending on how your card is set up, but with a US$-denominated card, a credit of US$100 should increase your card balance by US$100. So, that $US 100 can be spent on something else instead. In short, the card is your \"\"bank\"\" account. You cannot spend more than the remaining balance on the card just like you cannot withdraw more money from your bank account than you have in the account, and you can recharge your card by making more INR payments into it so as to increase the available balance. But it is like a current account in that you are unlikely to earn interest on the balance the way you do with a savings account. So what if you are back in India and have no further use of this card? Can you get your balance back as cash or deposit into your regular bank account? Call the Customer Help line, or read the card agreement you signed.\"" }, { "docid": "86716", "title": "", "text": "\"Others have commented on the various studies. If, as JoeTaxpayer says, this one particular study he mentions does not really exist, there are plenty of others. (And in that case: Did someone blatantly lie to prove a bogus point? Or did someone just get the name of the organization that did the study wrong, like it was really somebody called \"\"B&D\"\", they read it as \"\"D&B\"\" because they'd heard of Dun & Bradstreet but not of whoever B&D is. Of course if they got the organization wrong maybe they got important details of the study wrong. Whatever.) But let me add one logical point that I think is irrefutable: If you always buy with cash, there is no way that you can spend more than you have. When you run out of cash, you have no choice but to stop spending. But when you buy with a credit card, you can easily spend more than you have money in the bank to pay. Even if it is true that most credit card users are responsible, there will always be some who are not, and credit cards make it easy to get in trouble. I speak from experience. I once learned that my wife had run up $20,000 in credit card debt without my knowledge. When she divorced me, I got stuck with the credit card debt. To this day I have no idea what she spent the money on. And I've known several people over the years who have gone bankrupt with credit card debt. Even if you're responsible, it's easy to lose track with credit cards. If you use cash, when you take out your wallet to buy something you can quickly see whether there's a lot of money left or not so much. With credit, you can forget that you made the big purchase. More likely, you can fail to add up the modest purchases. It's easy to say, \"\"Oh, that's just $100, I can cover that.\"\" But then there's $100 here and $100 there and it can add up. (Or depending on your income level, maybe it's $10 here and $10 there and it's out of hand, or maybe it's $10,000.) It's easier today when you can go on-line and check the balance on your credit card. But even at that, well just this past month when I got one bill I was surprised at how big it was. I went through the items and they were all legitimate, they just ... added up. Don't cry for me, I could afford it. But I had failed to pay attention to what I was spending and I let things get a little out of hand. I'm a pretty responsible person and I don't do that often. I can easily imagine someone paying less attention and getting into serious trouble.\"" }, { "docid": "91804", "title": "", "text": "Is there a debit card accessing this account? When you spend money on a debit card for certain item, including, but not limited to gas, restaurant, hotel, a bit extra is held in reserve. For example, a $100 restaurant charge might hold $125, to allow for a tip. (You're a generous tipper, right?) The actual sales slips my take days to reconcile. It's for this reason that I've remarked how credit cards have their place. Using debit cards requires that one have more in their account than they need to spend, especially when taking a trip including hotel costs." } ]