Lessons in Investing from Germany’s Repatriation Program

gold investmentLast year, Germany ordered the U.S. to return some of the latter’s gold from its New York vaults. A lot of speculation circulated because of this, and one of the most popular is that Germany is worried about a currency crisis. But whatever the reason is for Germany’s decision in requesting for some of its gold to be sent home, let’s take a look at the lessons we can learn from the issue.

Keep gold investments close to you

This is very important. Gold and the USD is inversely correlated so when the stocks are down, gold prices are up. Just because gold prices are down today due to the anticipated interest rates hike in the U.S. next year doesn’t mean that investors should remove physical gold in their portfolio. After all, people invest in the precious yellow metal in order have something to turn to in times of economic unrest, which is the very reason why Germany has gold investments in the first place.

Gold rewards investors who wait, and Germany is well aware of this as evidenced in their decision not to sell any of their gold until 2020. In 2000, the yellow metal was merely at $300 per ounce. Ten years later, gold’s price spiked to $1,300 per ounce – an increase of more than 300%.

Liquidation

Next is that you want to keep your precious yellow reserves ready for liquidation. After all, there’s no reason to have gold investments if you can’t sell it when you need to. This is the perhaps one of the main reasons why Germany wants to return some of its gold back home. If in case something bad happens to its economy, its gold reserves will be ready for disposal. With around 3,380 tons of gold, Germany would be able to sustain its own economy for at least an entire decade.

Keep some gold overseas

Despite the repatriation program, Germany never intended to return home all of its gold. The country has gold reserves kept all over the world primarily because it wants to be able to turn to something in case another country invades Germany. Thanks to the advancements of today’s investing, private investors can easily store gold overseas, too. People can distribute their gold investments in vaults located in Germany, London, U.S., Paris, etc.

Germany’s tactics to keep gold close and ready for liquidation are lessons that investors need to understand. People shouldn’t only invest in gold for immediate gains. Rather, they should also invest in it for its ability to cover assets in times of an economic slump.

Fixed Rate Of Home Loan Vs Variable Rate Of Home Loan

home loan interest ratesMortgage is one of the pivotal factors when you are planning your dream home. There are mainly 2 types of mortgage options- fixed rate home loan & variable rate home loan. Are you too planning to buy a new home lately and could not be sure about which rate to pick from? Well, both the fixed and variable rate mortgage loans come with respective characteristic features ; you need study the conditions of both the loans before you decide on the compatible home loan option for you.

Definition- the interest factor

First of all, let’s clear about the definition- the terms “fixed” & “variable” are mainly concerned with the interest quotient of the loans. The Fixed rate loan implies such a mortgage where the rate of interest decided during the time of contract would stay unchanged throughout the entire loan period. On the other hand, the variable rate mortgage implies such a loan where the interest rate would alter according to changes in the market.

Security factor

If you want to play safe with your mortgage, the fixed rate loan is the best option for you. When you are taking to a fixed rate loan, you are aware of the repayment value beforehand which won’t change, irrespective of soaring interest rates in future times. Thus, here financial management becomes easy as when you have a major due fixed, you can make the other financial allocations accordingly. If you are a family man, the fixed rate option is compatible for you. In case of variable rates you are never sure of the repayment value. The interest rate is generally on a rise and you are most likely to face a bigger interest amount in future years which might affect your other financial plans.
According to studies among various mortgage lenders, people usually prefer to stick to fixed rate mortgage citing the security quotient. The very option offers the home owners a sense of stability & certainty in the mortgage.

Extra repayments

However, it must be mentioned that the variable rate mortgage loans are better in terms of flexibility while compared to the fixed rate home loans. The fixed rate option is usually limited in regards to extra repayments. But the variable rate generally allows you to go on smoothly with your extra repayments. In case you are having a surplus income, you can channelize the money for extra repayments which would help you to get rid of the debt issue earlier than your term. If you can repay your entire debt before the set term period, you have lesser risk to get affected with the rising interest rates in the years to come.

Extra repayment withdrawal

The fixed rate mortgage option will not allow the borrower to withdraw the extra repayment. But the variable rate mortgage permits the borrower to withdraw the repayments.

So, in conclusion it can be said that if you want a safe, peaceful experience, the fixed rate option is great for you. But if you have the possibilities of surplus income, you can head for variable rate loan that might help in early termination of the loan term.

How To Repair Your Bad Credit Report

In modern times of recession bad credit is very common. During times of loan sanction a poor credit record is what hits the most. If you cannot show up with high end credit back up, the financial institutions will generally not grant you in advance. Repairing bad credit might though sound intimidating it can be done. To start off, try figuring out what’s hurting your credit score. Then take steps to minimize the damage. Finally, start adding some positive information to your credit history. You can also hire a credit repair company as an option but make sure that you get the facts right before you put in all the cash. This can become very problematic at times of need and emergency. However, there are paydays that help you repair your bad credit.

It is very important for you to know what a payday loan is. It is a loan that covers 100 USD to 1500 USD maximum. Unlike financial institutions the repayment term is also not very long. It has a term of 15 days or a month. The biggest advantage of payday loan is that it is approved without any credit check. Thus, people who have bad credits can also apply for it and get loans sanctioned. Traditional lenders ask for detailed credit reports and background checks which consumes a lot of time. While, the payday lenders do not need any of this so, the entire loan approval process also quickens. Payday loans can be granted and received by you within 24 hours also. As the loan is approved in a day it is call a “payday loan”. Payday loan is definitely very helpful when you are down with sudden cash crunch that demands immediate financing.

The requirement for loan approval is very basic and nominal in case of payday loans. Since it is free of fuss and elaborates requirements it is very advantageous over traditional loan systems. All that the borrower needs to do is to prove that he is a minimum 18 years of age, his citizenship, a stable work or a source of income, and a valid banking account where the advance will be transferred. The payday loans do demand higher interest rates, but that is completely justified since the lenders also need security on their part.

This is a credit society. Without a sufficient credit rating, you are unable to function in the ways that you desire to in your life. Credit-rating is an integral part of your happiness and well-being. You are protected by the credit laws of the land and you should use them to your fullest advantage. This is the same knowledge for which the attorneys and services charge thousands of dollars for everyday. So, begin your fight for the restoration of bad credit and make a good name. If you have not ordered your credit report or credit score, now is a great time to have a look at both.

Importance Of Monthly Expense Budgets

In the contemporary age of recession and rising aspirations, a planned financial structure is the most essential. Unplanned monthly expenses would soon place you in a vicious debt cycle situation where you end up being unaffordable to go for your mandatory grand future plans. Thus the financial experts always stress on the importance of monthly expense budget to ensure a smooth worry-free life.

Prioritize financial goals

This is the most crucial advantage of planning your monthly expense budget. While you are creating the budget, you have to make a list of your mandatory financial expenses every month, followed by the secondary, emergency & luxury expenses. When you have such a clear-cut list before you, it becomes easy to differentiate your primary financial goals from the other avoidable expenses- enabling you to act accordingly.

Easy tracking

Planning of monthly expense budgets greatly helps you in tracking your monthly expenses easily. When you can track down all your expenses, it would be simpler for you to analyze where you went overboard last month & you would get cautious to check it this time.

Grand future plans

When you are chalking out a monthly expense plan, you reserve one column for your monthly savings. The best part here is that gradually you start learning how to duly manage all the monthly financial expenses, without disturbing the savings part. This in turn rewards you with a lump sum value in future to fulfill your grand plans like higher education for children or a new business venture or some grand tour aspirations.

Fast release from debts

The planning of monthly expense budget also assures a fast release from debts. Its improper planning and mismanagement of expenses that put people into an ever increasing debt cycle which can be effectively prevented with proper planning or management of your finances. A proper monthly expense budget planning will show you the expense areas where you can cut down for the time being- so that the debts get repaid smoothly.

Important for all

It’s to mention here that monthly expense budget planning is necessary for all, whether you are a parent or a senior person or single or the one who has just started his/her marital journey. It’s also important for the teen-agers who have just taken up a part-time job. The financial experts always advise to inspire kids with the importance of a planned financial life so that they can implement the policies in future with the promise of a tension-free life.

How To Invest In Gold?

Are you new to the world of investment? If yes then you must be unaware of the variety of investment options you have in the market today. You can invest your precious money in stocks, bonds, mutual funds, silver etc. But the wise move on your part would be to invest in gold because during the time of inflation or any such economic crisis, the prices of gold augment and the value of gold will always remain high as it is a precious form of metal.

Investing in Gold Bullion: Experts advice that if you simply want to invest in gold then you should go and buy some. However, you have to make sure that the gold dealer is trustworthy and sells you the gold at an affordable and right price. You can either invest in gold coins or gold bars. So whether you invest in gold coins or gold bars will depend on your personal preferences and the offers you get from the different dealers.

Financial Instruments based on Gold: If you are not interested in investing in gold bullions then go ahead and invest in financial instruments that are based on gold. For instance you can invest in the ETFs (Exchange traded funds) which can be bought from the share market and ETFs are considered to be the safest gold investment option. You even have the option of investing in the stocks of a gold mining or production company. But a lot of uncertainties surround the mining or production company stocks generally so people avoid this option as much as possible. Gold options (non-binding) and gold futures (binding) are also risky gold investment options but the returns you receive on these investment options are usually very satisfying.

Buy Gold jewelry: It would be a smart move on your part if you could purchase gold jewelry because investing in jewelry is a traditional and an old age investment option. However the immensely high making charges of the jewelry pieces can discourage you from investing in gold jewelry.

Investing in Gold certificates: Individual banks issue the gold certificates to investors. But you will not have to worry about the security and storage of such certificates because the bank holds on to them on behalf of you. Gold certificates are rare investment options.

Hiring Financial Advisors

Decisions related to financial investments are very risky and confusing most of the time. Thus it is really essential that you hire a financial advisor who can guide you and help you earn profits in the right way. However, finding the perfect financial advisor is a very daunting task because a number of financial advisors have come into existence today. This article will help you hire the right financial advisor.

First of all, you can ask your colleagues, friends and relatives for referrals. Sometimes these people can turn out to be your best source of financial advisors. You can even carry out your search for financial advisors online. After you get a list of advisors then you can have a personal meeting with each one of them and notice how they interact with you. A good financial advisor will listen to you and work according to your financial goals.

You have to check whether the financial advisor you are working with has enough experience or not. He/she should be one of the best advisors that are located in and around your area. You can find out about the financial advisor’s credentials and capabilities by talking to his/her previous clients and going through his/her online website. Make sure that you verify all the listed references that are given to you by the financial advisor.

Ensure that you hire only a registered and licensed financial advisor so that you can avoid getting conned. You should also have no doubts regarding the fees or commission that is charged by the financial advisor. Work with an advisor who charges reasonable fee or commission.

If you really do not have the ability and confidence to take your financial decisions on your own then go ahead and hire a financial advisor as soon as possible so that you can earn more and more profits.

Steps you must follow before financing your vehicle

There are certain steps that you must follow when you are financing your vehicle.

a) You must decide carefully which vehicle you want to purchase first. This might be an easy decision because you already know which vehicle you are going to buy. After you have done this, you will have to choose the options that you would like on the vehicle like fog lights, upgraded wheels, and cruise control. The sound system should also be considered as the might cost a lot.
b) You must also take a test drive for the exact vehicle that you want to purchase. You should go to your favorite dealer. Check out the look and feel about the interiors of the vehicle and buy only when you are sure that it the vehicle that you want. Ask the sales person as many questions you want about the features of the car. They will try convincing you o purchase the vehicle today itself, but you should politely turn down their request.
c) You should find out about the invoice price of the vehicle. There are various websites from where you can get the invoice price, just make sure that you include the price of all the features that you want for better accuracy.
d) You should also keep your self ready for the loan. Look for the best interest rates and terms for purchasing the vehicle. Credit unions are very much reliable to get low interest loans. If there are any qualifications that can help you get any discount then make sure you avail of those discounts.
e) You must get quotes from various dealers through emails. Make sure you give the exact definition of all the descriptions that you require in your car. Three to four dealers must be consulted.
f) Go and collect the vehicle from the dealer giving the least quote.

Importance of hiring an investment planner

Hiring an investment planner is not a trivial matter for you. It is a particular proposition that calls for a great deal of precision on your part. It is a fact that proper and reliable investment planners can help you a lot in your growth objectives. They can make it a point that you are going to come out with a profit making deal. Would you like to know more on this issue? Well, in that case you have to cave for a little bit of tête-à-tête on this aspect. Take a look at how these investment planners help you out in making crucial decisions.

• Help you take decisions- it is the responsibility of an investment planner to help you take important decisions in a precise and flawless manner. With the help of their knowledge and incisive suggestions they try to show you the right path.
• Proper knowledge on investment related matter- You cannot choose to ignore or gainsay that that proper and reliable investment planners have got sufficient knowledge on investment related matters.
• They get you right financial solutions- Before you are actually going to hire one investment planner you should know why there are important. No one can offer you such value added advises. They get you right financial solutions.

It is a fact that proper and reliable investment planners can help you a lot in your growth objectives. They are indeed the best friends for you. They are going to make it certain that you get the fruition out of the amount or sum total that you invest. Make it sure that you are going to keep a very close and razor sharp eye on the facts shared on the issue of hiring an investment planner. Indeed it is not a trivial matter for you. Before you are going to choose the services of one you should research sufficiently on this subject.

Government shutdown to prudent investors

The most recent government shutdown took place in 1996 and there have been 17 of them before. These government shutdowns have shown terrible negative effects on the market. Stocks dropped during nine shutdowns among 17 and as soon as the shutdown ended, the market raised and gained an average of 13.3% over the next 12 months. These make one thing clear to us there will be volatility in the market which can never be predicted. So, in these cases it is advisable for you not to sell out because it will be a difficult job for you to decide when to buy back. Surveys say that the investors who got nervous because of the government shutdowns and sold out their shares, they could never enjoy profits in future when the situation became stable.

An investor should not get nervous in tough situations. If you have hired a financial planner, they should be able to motivate you and stick to the plans that you had made before investing. They should sit and discuss the ways by which you can maintain your game strategy and allocate your assets in such a way so that you can meet your long term goals. You should never sabotage your long term investment returns if there is volatility in the market.

It is an useless idea to check out the news and events that predict the market in future. This is because no one can say from before exactly what is going to happen in the market.

A proper financial planning is of utmost importance for an investor. If you are a retired person or you will soon be in that list, the necessary liquidity that you can easily earn to run the expenses of your household for a period of time should be included in your planning. Thus, if you are covered in liquid investments for five to seven years, you need not worry about the short term volatility in the market to run your expenses.

Investment in Bonds: an Overview

Investment market is a highly complex and risky market. If you are a beginner and have no knowledge about the different investment options you have then you must first make an effort to know the investment market better. Money can be invested in a number of things like bond, stock, currency, property and so on. Experts advise that you must enter the investment market for the very first time by investing in bonds as these are considered to be investment options that have low risks involved.

Bond is nothing but a loan that you give to a federal agency, corporation, municipality, government and any such organization which is called the issuer. The bond has a fixed rate of interest which is given to you periodically. When the bond becomes matured, the issuer will pay you the principal (original value) cost of that particular bond.

An investor should make it a point to invest in different things so that his/her investment portfolio becomes diversified and his/her risk exposure is reduced. Thus as an investor you must invest in bonds as these help diversify your investment portfolio and reduces your exposure to risk.

The major risk involved in investing in bonds is the unduly rise or fall of the rates of interest. The rates of interest fixed on the bonds you invest in, can either help you make lots of money or lose huge amounts of money. When the rates of interest will increase, the costs of the bonds will decrease and then you will have to sell those at a lower price. Some other risks involved in investing in bonds are currency risk, liquidity risk and credit risk.

Before investing in bonds, you must approach a reliable financial advisor for help so that you can ensure higher or risk free return on your investment.

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