The Tools You Need to Successfully Teach Your Kids Money Management

By Odysseas Papadimitriou, CEO of Card Hub, a leading online marketplace for both secured and unsecured credit cards

Consider for a second your financial youth. Did you have someone to teach you not only the value of a hard-earned dollar, but also how to correctly manage all of the dollars you accumulated in order to ensure financial security later in life? Or, was your financial literacy gleaned from a trial by fire?

Judging by the widespread overleveraging and risky lending that led to the Great Recession and the increases in consumer debt that we have seen since the country emerged from it, many of us still don’t have a firm grasp on what it takes to be fiscally responsible. And since we don’t want our children to make the same mistakes we have or endure widespread financial struggles during their adult lives, it’s important that we instill within them at a young age things like the tents of responsible credit use, the basics of investing and lending, and how to plan for retirement.

“Ok,” you might be thinking, “but that’s easier said than done, right?”

Use a Prepaid Card

It sure is, but you need to start somewhere, and that somewhere is a prepaid card, interestingly enough. Prepaid cards have traditionally served two primary purposes: acting as alternatives to traditional checking accounts for people who misused these traditional accounts in the past and helping young people on the road to financial literacy.

Prepaid cards are particularly well-suited to this latter end for a number of reasons, including:

1. Their similarity to checking accounts: Prepaid cards are essentially checking accounts without the paper checks. Online bill pay, direct deposit, ATM withdrawals and in-store usage are all possible with them, so using one will prepare your child to effectively manage his or her checking later in life.
2. Their conduciveness to parental involvement: Prepaid cards are tied to online accounts, which parents can monitor and control. This not only allows you to set the amount of money at your child’s disposal, but also review the rights and wrongs of his or her card usage.
3. Their potential for minor misuse: Prepaid cards often have a variety of small fees that can really add up if a card is used incorrectly. Therefore, you child will have to learn what’ll result in a fee in order to make his or her money last.

Stress Budgeting & Responsibility

Still, a prepaid card itself won’t help your child learn. You need to implement an allowance system to truly hammer home the consequences of wild spending and the need for budgets. While the details of each family’s system will differ, they should all follow this basic framework:

1. Open a prepaid card and explain its basic features and fees
2. Load enough money to last your child two weeks
3. Explain to your child that he or she will have to pay for their own weekend activities (sub in any recurring expense) and that no more money will be provided until the two weeks are up, no matter what
4. At the end of the two-week period, review you child’s purchases with them
5. Repeat until you are confident that your son or daughter has mastered the basics
6. Move to monthly allowances and again repeat

When your child masters prepaid card use, give his or her allowance in cash in order to teach the importance of keeping track of physical money, which obviously cannot be monitored by parents. After that, open a checking account in your child’s name, opt-in for the ability to overdraw the account, and use that as an opportunity to teach the importance of not using money you don’t have. Lastly, co-sign for a college student credit card and teach the tents of managing a credit line and the importance of maintaining a solid credit score.

Each step you take, increase both the amount of the allowance and the number of expenses your child is responsible for. Hopefully, after all of this, your child will be comfortable with the idea of financial independence and will understand how to handle it properly. If you can manage that, you’ll surely have done your job as a parent, and your son or daughter will be way ahead of the game!

Save Money by Self-Educating: 10 Sites To Help You Master A New Language

Being multilingual is an important skill in today’s world, where interaction with people from all over the world is a potential part of everyday life. Not only will it give you a great connection to a different people and culture, but it can improve job prospects and even salary rate. Not to mention the important changes it has been found to spark in the brain, increasing a person’s ability to retain and process information.

But many people will will hold back on learning a new language out of fear of failure, or not knowing where to start. After all, those programs you see on TV or online are expansive, especially if there is a risk that it won’t work.

Don’t get discouraged! There are amazing resources free online to help teach you a new language, no matter what that language might be. Check out these ten websites that will make learning a new dialect a breeze.

General Language Sites

• BBC Language Courses – Perhaps the best website for language help., the BBC offers users all over the world fully interactive and complete lessons in 40 languages. Their most popular are French, Spanish, Greek, Chinese, German, Italian and Portuguese. But they also have phrase guides for Albanian, Bulgarian, Czech, Danish, Estonian, Flemish, Hungarian and dozens more.
• LiveMocha – If you learn better with others, you will love LiveMocha. They are an interactive community website, that allows you to learn alongside others from around the world in a social networking context. They have 35 languages available, with millions of users. You can practice with others, trading languages and learning about each other’s culture while you are at it.
• Babbel – Babbel is a training tool meant to help you practice your pronunciation. You use the review manager to speak the words, which gives it a collection of your vocabulary. It will calculate the rate you speak and where your problems lie, and then give you a report to isolate your strengths and weaknesses for a more targeted practice experience. They also have an iPhone app.

Chinese

• Learn Chinese On CRI – Once you get over the somewhat crazy interface and layout of the site, you will be sure to love these lesson plans and exercises. Well paced, perfectly structured and helpful for any level, you can learn grammar and vocabulary while figuring out how to use both causal and formal verbal skills. There is a section on Chinese culture that is also very well made.
• Learn Chinese On Minmm – This site also has a very hard to navigate site, with no real method to the layout. But the lessons are really good, with everything broken down into categories by level of education. There are beginner, intermediate and advanced classes, as well as supplement courses and tools. They also have some interesting classes on Chinese chess and painting, as well as other cultural activities.

Italian

• ElanguageSchool – This program aims to teach you using a carefully constructed plan that keeps your brains functions when learning in check as you go. They have some of the most in depth Italian exercises and lessons on the web, though the site offers other languages as well. Some of those include Hindi, Dutch and Arabic. Be sure to check out the excellent education videos that will help you put what you learn into practice.

French

• Language & Lyrics – This program isn’t technically free, but the first chapter is. It works by teaching language through music and lyrics, using the principle that the mind reacts to the sound of music more than words alone. You can try it out without paying a cent, which is worth a shot.
• ElanguageSchool – Another program from eLanguageSchool, this one works mostly based on French language comics, which give you a visual context along with the words. They also have a course of grammar and vocabulary, which can be viewed with links in the sidebar.

German

• DW World – This program has you create an account and throws you right into things. It has a progress meter for their interactive lessons, which show you how you are doing as you go through each level of learning. They have a lot to offer.
• Deutsch Lernen – There are 34 lessons on this site for those who want to learn German. Ten of them are for beginners who have no experience with the language. The next 24 are for more advanced users. You just work your way through them to get a basic working grasp on the language. They also have tests so you can try out your building skills.

These are some amazing websites that will help you to learn a new language and increase your knowledge of the world. Take advantage of them and watch your potential increase as you expand your mind.

Annie is an Internet geek living her life online and blogging for Vacation Pass, the free educational resource for international travellers offering access to a wide array of Go San Diego Card coupon codes.

What is a Trust Fund?

While many people have heard of a trust fund before few people really understand what they are and how they can benefit you. Here, we aim to solve this problem by providing you with a simple explanation of the ins and outs of trusts funds and why their worth looking into.

The Basics

In its simplest form a trust fund can be described as an asset which is held by a trustee for the eventual benefit of another person or entity. A trust fund is created by a person who is known as the settlor (also called a grantor or donor). The settlor entrusts his assets (usually financially based) to the person or institute of his or her choice, which are then known as the trustee. The trustee’s job is to hold and administer the trust’s assets for the benefit of one or more individuals, which are known as the beneficiaries. The beneficiary of the trust is the one who will receive the assets and is chosen by the settlor.

The trust fund will have a number rules attached to it determining how the money is governed. The trustee has legal title to the trust property but is obliged to administer the trust to the beneficiary in accordance with the terms set out by the settler. Trust funds are also governed by the laws of the country they are held in; in particular, they may be subject to certain taxes.

Who are they designed for?

Trust funds are designed for a large number of people and circumstances, though they are usually used by parents wanting to save for their children or as way to easily transfer your assets when you die. A common use for a trust fund is to provide sustained support for a beneficiary rather than a one off payment at a designated time. This can be particularly useful if you wish to support your child who may not be mature and responsible enough to properly handle large amounts of money.  Trust funds can also be set up for charities or charitable purposes and are normally tax exempt.

What can be held in a Trust Fund?

A trust fund is usually designed to hold money though they can contain all types of assets and other financial instruments such as shares, bonds and property. The settlor can continue to put assets into the trust fund throughout its life allowing its worth to grow over time. A trust fund can either be revocable or irrevocable. A revocable fund means the settlor can take back all the assets should they choose to do so, whereas an irrevocable fund is a permanent agreement, which offers added security to the beneficiary.

Sara Senger is a writer and blogger who contributes to a plethora of sites including Amateur Gastronomy and has written this article on behalf of Ulster Bank, a provider of savings accounts.

Mortgage Basics For The First Time Buyer

Buying your first home is very exciting, but it can also be overwhelming. There is plenty to learn. You want to get a great home, good interest rates, and you want to be able to afford it. Understanding the basics will help you to have a good experience instead of one that you regret.

Take a Class

Many communities offer classes for first time home buyers. They are often for a couple of days or a full weekend. They go over all of the details of the process from start to finish. This process helps someone to have some guidance about the various steps to buying their first home.

Find a Terrific Real Estate Agent

Even with such information, the road to navigate can be tricky. There are many options with a first mortgage so you need an expert to help you out. Find a terrific real estate agent that can  help you. Be honest about your lack of experience so that they can take you under their wing.

Evaluate your Credit

The last thing you want is to have some unexpected surprises when your credit check is done. Do yourself a favor and find out what is on your credit report. If you have high debts, try to pay down the balances. If you see mistakes then get them off your credit report.

Gather Documents

You will need plenty of documents to buy your first home. Get them ready so you don’t have delays in processing while you find them. You will need verification of income, tax returns, self employment information, and a photo ID. If you need any other documents, your real estate agent will tell you.

Complete Pre-Qualification Paperwork

It can be important to get pre-qualified for a home. Then you will know what price range to be looking in. This paperwork isn’t as in depth as your actual mortgage loan will be. Yet it can help you to get the most out of your efforts to find the perfect first home to purchase.

Be Realistic About what you can Afford

It is very important to be realistic about how much you can afford for your first home. You can always sell it down the road and get a bigger house or one that has more perks. You need to make sure the payment fits comfortably into your budget.

Read Over all the Documents before Signing

The documentation for a first mortgage isn’t entertaining to say the least. It can be dry and boring. However, you have to read through it so that you understand the interest rate, the length of the loan, any concerns over pre-payment penalties, and more.

Ask Questions about Anything you don’t Understand

Always take the time to ask any questions bout the loan documents before you sign them. Don’t be shy about asking for clarification. Buying your first home is a big step and a huge commitment. Yet it is also a great investment that you can be very proud of.

The author helps South Afrian citizens to get home loans and also educates them on finding the best interest rates.

Different Kinds of Insurance that People Need

Insurance offers coverage that is in place should a particular type of event occur. There are many types of insurance that people need. Here you will find some basic information on the most common ones.

Vehicle Insurance

It is always a good idea to have insurance on your vehicles. In some states it is mandatory by law. In others it is optional. There are two types of vehicle insurance – liability and full coverage. With liability insurance, you are only covered if you hit someone else’s vehicle with your own. If you happen to drive your own car into the garage it won’t be covered.

By the same token, if you only have liability and the other party is at fault but doesn’t have insurance, there won’t be any compensation. Typically, any vehicle that is finances has to have full coverage on it. Once the vehicle is paid for the customer can choose to keep full coverage or reduce it to liability.

In addition to covering the vehicles, such insurance also covers bodily injuries that could result from such an accident. The cost could include the ambulance, medical care, ongoing medical care, and even pay for work a person misses due to their injuries.

Homeowners Insurance

Very few people have the money to be able to buy their home without financing it. When it is financed, the lender will require that it is insured for the duration of the loan. This is to ensure that the lender can recoup their money if there are any damages to the home. It also means that if there is water damages or roofing problems then the owner of the home has a way to get help paying for such repairs.

Life Insurance

While no one wants to think about dying, it is something we will all deal with at some point. Life insurance ensures that you have money in place that can be used for your loved ones. They will be able to pay for living expenses, funeral costs, and bills. You don’t want them to be burdened by financial woes during their time of mourning. The cost of health insurance will depend on your age and your overall health.

Health Insurance

The cost of health insurance continues to increase, even when it is offered through employers. This has made it very tough for families to maintain coverage. There are also co-pays and deductibles that can apply to health insurance as well. There are many types of health insurance though so you may be able to get some coverage that will work for you. Check out your options and see what you can afford.

Dental Insurance

Good oral hygiene is also very important. You want to make sure you see a dentist twice per year. Dental insurance can help to pay for regular checkups and for dental work. Some insurance plans pay for orthodontics and others don’t so keep that in mind when you look at the types of insurance plans out there.

The author helps people to get affordable insurance quotes. On his website he also offers advice on selecting the right insurance.

5 Ways Being In Debt Makes You A Better Person

Growth is a product of adversity. Mistakes become teaching points. Struggles test our fortitude and harden our resolve. We learn how to deal with pain and how to overcome it. So while being in debt may not be an ideal situation, it does represent a kind of adversity, a turning point in our lives where we can either sink or swim. By learning from these mistakes and fighting your way to solvency, being in debt can help you grow into a better person.

1. Becoming More Self-Aware

Having a personal debt crisis forces you to undergo a self-examination. You begin to re-evaluate your spending habits and the behavior that created them. Maybe you spend beyond your means. Maybe you are a bit too gullible when it comes to duplicitous credit card promotions, or simply lack the attention to detail to read the fine print. Perhaps you are a bit too generous with friends who are friends in name only. Whatever the reason, a large debt represents a personal failing, and the first step to recovery is identifying where you erred.

2. Caution is a Good Thing

Being in debt is usually a symptom of taking an inordinate amount of risks. Although a certain amount of risk goes hand in hand with enjoying life, true wisdom comes with the ability to assess which risks or worth taking and which are simply foolhardy. Being in debt in this regard is a good life experience that teaches you the value of being cautious and frugal.

3. Seeing the Forest Through the Trees

When you evaluate the cost of interest, it helps you realize that short term happiness is not worth long term ruin. The trick is to overcome the temptation of present bias. However, once you are caught in the web of overwhelming debt, you are forced to look at everything in the context of the future. Every large purchase tacks on another year to end of your debt sentence. In this way, being in debt helps you gain perspective.

4. A Test of Mettle

Getting out of debt is not an easy thing. It represents a huge challenge personally as well as financially. You will need to change the lifestyle you have become accustomed to. It requires sacrifice and dedication. These are qualities that all individuals strive to attain, but few experience the kind of adversity required to forge them. Getting yourself out of debt is a hard thing, and is something that will affect your life every single day until it is cleared.

5. Learning to Live Without Money

One of the best side effects of not having any money is learning to appreciate life without it. Given that you are no longer part of the consumer economy, you will no longer be obsessed with the latest gadget or fashion. You may become more environmentally friendly, consuming less red meat and driving less to save on gas. You will spend more time doing activities outdoors rather than spend money on electronics in the home. Overall you will be a less greedy person, as the allure of consumption is no longer applicable to a person with your debt. Often times people will waste their entire lives in pursuit of impossible financial goals. Being consigned to a more modest life can have a healthy effect on your character.

Article by Frank Smith of credit report uk. Frank writes about a variety of finance related topics including credit rating tips and information.

Are You Financially Literate?

Many people find finances stressful. Whether working with loans or simply paying bills, this is a major aspect of one’s life. Being financially literate allows a person to carefully manage his money to avoid unnecessary debt and stress.

Mortgages

A mortgage is used when a person uses a home as collateral in order to obtain a loan. This type of loan is typically used to purchase the home that is being used as collateral. When making mortgage payments, a person is expected to pay off the principal, or the original loan amount, as well as pay interest to the company. It is important that the borrower understand how the interest rate and the term of the loan affect his payments and finances. The term of the loan is how long it will take to pay it off. A longer term may create smaller payments, but the total cost will be much more than the principal because of the interest. Understanding how a mortgage functions will help a person avoid loans that are not really affordable.

It is vital for a new homeowner to have house insurance. If there is any damage to the home, this insurance will help pay for repairs as well as help with mortgage payments if there is a disaster. Many lenders prefer or even require the borrower to have house insurance. Finding the cheapest home insurance will prevent unnecessary financial stress.

Credit Cards

Credit cards allow people to have a convenient source of credit. There are consequences to using a credit card without proper planning. The interest rates attached to these cards tend to be higher than those of other credit sources. This makes it important for a person to pay off credit card debt quickly. Charges that are paid before the next payment period do not carry interest. If the person completely pays for his charges every month, he will not have to pay extra interest fees and become seriously indebted. Being informed about the charges and fees of each credit card will allow the consumer to make better financial decisions as well as improve his credit score.

Financial Tips

A major part of being financially literate is understanding every aspect of one’s own finances. Insurance can be used to protect assets as well as income. Using the cheapest insurance available will provide coverage without having fees beyond the family’s budget. Searching for the cheapest home insurance may appear difficult, but it will have plenty of benefits. Regardless of one’s financial situation, having the cheapest insurance is a great way to protect the members of a household. There is no reason for a person to have more expenses than he can reasonably afford.

Tax Definitions: Why You Need to Understand Tax Terms

Dealing with the tax system can be like trying to understand another language until you begin to recognize the many unfamiliar terms that are used. The unique terms used in the tax system all have very specific definitions that are intended to make things clearer, but until you know what these terms mean, they can just seem to make everything more difficult. Understanding the necessary tax definitions can make dealing with your taxes much quicker and easier, and it can make tax season much less stressful.

It is incredibly important to understand the tax definitions that are relevant to your own situation. They will help you to understand what you are required to do, which forms you need to fill in, how they should be completed, how much you should expect to pay in taxes and what you may be entitled to in return. If you don’t understand the relevant terms then the tax system can be incredibly confusing and you will be more likely to make mistakes or end up with serious tax problems. You could waste a lot of time, effort and money.

Understanding terms such as credits, deductions, adjusted gross income, exemptions, progressive taxation, taxable income and withholding, as well as the names of the many forms and elements of the tax system, such as Form 1040, can all be very important when you are filing your tax return. Once you understand the tax definitions that are relevant to your own situation, you will be able to approach your taxes with more confidence. You don’t have to understand the entire tax system, just the sections and terms that relate to your own taxes.

For more comprehensive tax definitions please visit income tax crew site.

Will Debt Consolidation Affect my Credit Rating?

If you’re keeping track of multiple debts and would like the opportunity to lower your monthly outgoings, or you would just like to make your finances easier to manage, you may find that a debt consolidation loan could help.

A debt consolidation loan could make a big difference to your financial situation – but it’s important to remember that they aren’t suitable for everyone, and you should make sure you look into all your options before committing to anything.

How could a debt consolidation loan improve my financial situation?

A debt consolidation loan can allow you to pay off your existing unsecured debts in one go, after which you’ll repay your consolidation loan in single monthly payments. This can make your debt much easier to keep track of, as you’ll only have one payment to make to one lender each month, instead of several.

Many people who are consolidating their debts take the opportunity to arrange to repay the loan over a longer timeframe than their original debts – making each monthly repayment smaller. This can help to free up extra cash on a monthly basis, but bear in mind that repaying your debt over a longer timeframe means you will pay interest for longer, so you may pay more overall.

Having said that, though, your debt consolidation loan may come with a lower interest rate than your existing unsecured debts – particularly if you are consolidating debts with high APRs (Annual Percentage Rates).

What impact will debt consolidation have on my credit rating?

Debt consolidation shouldn’t harm your credit rating at all. Unlike other debt solutions (such as a debt management plan or an IVA (Individual Voluntary Arrangement)), debt consolidation doesn’t involve asking your lenders to accept smaller payments – you’d simply be paying off your debts all in one go.

Providing you can keep up with the repayments to your new loan, you’ll be showing your new lender that you are a responsible borrower – which should help keep your credit rating healthy.

Plus, having just one debt to focus on – and one payment to budget for every month – should make it much easier to keep on top of your monthly payments from now on, lowering your risk of missing payments.

If you aren’t able to keep up with your repayments, though, and you start missing them, this can affect your credit rating. This is one reason you shouldn’t take out a debt consolidation loan – or any form of credit, for that matter – unless you’re sure you’ll be able to keep up with the payments until the debt is paid off.

This article was written by First Debt Consolidation – you can visit their website here: www.firstdebtconsolidation.co.uk.

Exchange Traded Funds – Better than Stocks?

The stock market didn’t exactly do its image as an investment option any favors in the 2008-2009 crash. Wall Street in particular left a bad taste in people’s mouths with its apparent inability to comprehend the needs of investors. Those who’ve been watching the Dow Jones in its various states between amateur bungee jumping and comatose immobility at low levels are less than impressed. Anyone who’s ever bought car insurance would probably agree that it’s a more transparent process than investing in the stock market’s tantrums.

Anyone who’s ever bought stock will have probably bought something they wish they hadn’t, at some point. The trouble with buying individual stocks is that they’re basically one trick wonders. They go up or down. You’re effectively stuck with their performance as the value of your investment. You’re also at a distance from the markets, and can find yourself reading about the fallout from some deal which has decimated your holdings value. Exchange Traded Funds, (ETFs) may be the answer to what you’re looking for in the investment choice quandary.

ETFs basics

Exchange Traded Funds currently have a bit over a trillion dollars under management around the world. They were first introduced as “boutique” investments with high unit prices, but have evolved since the crash into high volume trading commodities at lower prices.

The basics:

• ETFs are professionally managed.
• ETFs charge management fees, typically around 1-2%
• ETFs are groups of stocks, “baskets”, usually based on particular indices.
• Some ETFs are based on performance values, offering “3x” or three times the value of the index performance over time.
• ETFs are far more diverse than mutuals in terms of holding options.
• ETFs can be traded on the stock exchange like normal stocks.
• They pay dividends, and occasionally split.

ETFs and performance issues

To give an example of how ETFs perform:

During the housing crash, the prices of ETFs holding mortgage securities also went into a nose dive, purely by association. They then went straight into reverse, returning to their original prices, unlike the rest of the mortgage market, when investors realized the mortgage-based ETFs were holding excellent assets which weren’t even scratched by the mortgage securities fiasco. They sailed through the 2008-2009 crash pretty well, too.

There have been investor issues with the short selling ETFs and some other individual ETFs. If you’re thinking of investing in this complex market, you need to make comparisons of performance of similar ETFs and check any information about your ETF interests thoroughly.

Check out in particular:

• Price bandwidths over time- This particularly useful in assessing a median value.
• Trading bandwidths- These are used as “high-low” measures for traders.
• Dividend performance- Some pay well, others don’t.

Compared to the stock market itself, ETFs are as transparent as car insurance quotes. All information is upfront, and these funds are managed by major players like Vanguard and Deutsche Bank. Even the mutuals are starting ETFs, trying to catch up, so you have a lot of investment options.