Money

This page shows that by the time you can make ends meet, they move the ends.

Quicken WillMaker Plus 2004 by Nolo Press

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Save Money on Mortgage Interest With Cash Management

One of the most eye-opening and jaw-dropping moments of my life happened when I first heard about what I'm about to describe to you here below.

When I bought my first house, I got the "RESPA" statement that homeowners are required by law to receive. It states the "APR" and the total amount of interest that will be paid, which, over 30 years, amounts to about as much as the loan itself . A $100,000 loan takes over $200,000 to pay back.

But that's not the amazing idea I'm about to tell you.

For many years, I had assumed that there was nothing that could be done. Where else can I get that amount of money?

The amazing idea, that I realized many years (and hundreds of thousands of dollars spent on mortgage interest) is that the banks have structured interest payments to benefit THEM. Well, no surprise there. The mortgage structure is so beneficial to banks that law makers required disclosures (the RESPA statement).

But in all the fine print is why consumers pay so much interest: because "closed end" first mortgages compound on a daily basis. Since payments are made on a monthly basis, the bank gets to charge interest on interest throughout the month.

Yes, it's more convenient for consumers to pay on a monthly basis. But that convenience costs homeowners a lot of money due to daily compounding.

So the more often a homeowner makes a payment, the less interest is charged due to compounding.

Another thing that banks don't want people to know is that additional amounts banks must apply to the "principle" of the loan on which interest is based. Thus the less the principle, the less interest can be charged.

By paying your mortgage on a bi-weekly basis (every paycheck usually), you can reduce interest expense by spending the same amount of money.

Cash Jeopardy Quiz

#1 A: All 50 states are listed on this US paper money denomination.
Q: $5 bill (on one side of the Lincoln Memorial).

#2 A: On this American bill, you will find an owl and a spider.
Q: $1 (Owl in the upper left-hand corner of the "1" encased in the "shield" and a spider hidden in the front upper right-hand corner.).

#3 A: This US coin has 118 ridges around the edge.
Q: The dime (10 cents).

#4 A: Of 41, 95 or 293, the number of ways to make change for $1.
Q: What is 293?

Credit Cards

First #	Type	Length	Phone	Website
3	travel/entertainment cards JCB	15 or 16
37 34	American Express	15
300-305 36 38	Diners Club	16
4	Visa	13 or 16	800.VISA 911	Verified By Visa
5	MasterCard	16	800.MC ASSIST	MasterCard SecureCode
6011	Discover Card	16
8	Voyager	15

Here is a list of the different types of credit cards.

If you get a call or email from anyone claiming to be from these organizations, tell them you'll call them back through these numbers above.

To add an extra validation step upon checkout on websites of participating merchants, go to credit card processors' webpages to set a password.

As with any site that should be private, click on the lock icon (at the bottom of your browser) to verify who is associated with the certificate used for the "https" in the URL address.

ANSI Standard X4.13-1983 specifies credit card numbering, such as the first digit(s) signifying the system:

Digit 16 is a check digit.

• Graham King figured out these 48 credit card test values [csv file]

These can pass the Luhn formula (MOD 10) CRC. [ code implementations]

1. Double the value of every other digit starting with the next-to-rightmost digit.
2. If any of the resulting values has more than two digits, then its digits must be added together to produce a single digit.
3. Add the sum of all the digits not doubled in step 1 to the sum of all the digits resulting in step 2.
4. If the result is exactly divisible by 10 (that is, if the result ends in a zero), then the number is valid--providing of course that it's of the correct length and bears a correct prefix for that type of card--and can now be submitted for authorisation of a sale.

To limit liability, credit card values should not be stored in the database. But if you must, store them in encrypted form.

Display credit card values only on the page which edits the value. otherwise, hide all but the last 4 digits of the card number.

ISO 7810 defines Credit card size (3-1/8 inches by 2-1/8 inches),
ISO 7811 defines embossing,stripe layout, magnetic stripe data and character sets.
ISO 7813 defines financial transaction cards.

Caution: Credit Card Balance Transfers

Be aware that credit card companies who offer "low interest rates" take your money several ways:

• “Transaction fees” of $25 or more (which may be more than the savings in interest rate).
• Aggregation of interest on other balances.
• Interest which compounds (grows) daily instead of being calculated monthly.
• Escalation to high interest rates (retroactively) if you're late just one time.
• Minimum balances you must borrow over time or get charged a hefty fee.

This is the reason banks are spending so much effort offering these accounts. More profitablity for them means less money for you.

Call the number on each of your credit cards and ask them NOT to send you checks in the mail. I've had someone find one I threw away and cashed it. It took 6 months and many phone calls to recover that money.

Credit Card Rewards

This page describes how one can logically figure out which credit card to enroll in.

If maintain good credit (income, home ownership, usage and payment history, etc.), you will qualify for a wider choice of credit cards.

Here is my strategy for deciding which credit card to apply for and use. Do I get more back from "1% cash back" per dollar spent or $"50,000 miles"?

First of all, some people say that all the cash-back schemes cost the retailer, which reflect in higher prices. I agree, and use cash for local merchants who I want help to keep in business.

A credit card with a fee involved can be worth the money if you absolutely would do whatever is offered you anyway. $400 for an American Express Platinum card makes sense for someone who would already pay its $500 renewal fee for unlimited entry into lounges in airports.

Strategy 1: Cash basis
The $100 for an USAirways card offers a free companion pass every year. If your company doesn't pay for your significant other to travel with you, that's a good benefit. However, as I'll cover later in this article, I wasn't able to use companion tickets due to the many many restrictions airlines pile on to prevent actual use of those miles, such as blackout dates, a limited number of seats which alines give out free, etc.

Dollars Spent	Points	Cash Back	Dollars back per point
$2,000	-	$20.00	.01
-	2,000	$20.00	.01
-	25,000	$250.00	.01
-	25,000	$50.00	.002
-	35,000	$100.00	.00286
-	59,000	$200.00	.00339
$40,000	-	$400.00	.01

It can be complicated to figure out the bottom line difference between offers.

My suggestion: use a single common measure: Dollars back per dollar spent.

If you're promised 1% back per dollar spent, then if you should get back (by definition) .01 (1%) of a dollar. To do the math on a calculator, type in 2000 for your spending, type * to multiply by .01 = $20 back. This I put on the table.

On the other hand, if you're promised 1 point per dollar spent, then if you spent $2,000 you should get 2,000 points. To be equivalent to a 1% cash back deal, that 2,000 points should be able to buy $20 of something, calculated by 2,000 points * .01 dollars back per point = $20.

So is getting a $50 card for 25,000 Marriott points better than 1% cash back? Well, multiplying 25,000 by .01 = $250. Yikes. In other words, if you had a 1% cash back card, you could instead have five of those $50 gift cards. So unless you got those points on a "5x points" offer or getting 5 points for every dollar spent, you're still not getting as much as a 1% cash back offer.

However, since Marriott rewards 10 points per dollar spent (but 5 at Residence Inn and TownPlace properties), they're giving the equivalent of 1%. Those at high Elite levels get better than 1%.

Hilton's Mall Amex

Quiz: If you're given 35,000 points to sign-up, what are you really getting enticed with?

Companies usually offer better conversion rates on larger redemptions. Divide that $50 by 25,000 = .002 dollars per point. However, a $100 gift card for 35,000 points is redeemed at $50 / 35,000 = .00286, which is a little better deal than the $25 card. The $200 card is redeemed at .00339, which is even better, but still not as good as 1% cash back.

Strategy 2: Beware of foreign transaction fees and current conversion rates
Most credit cards issued in the US charges a 3% or more foreign transaction fee, even while in Canada.

Some Capital One cards and cards from some credit unions do not charge a fee.

The one time I checked, the United Explorer card had a more favorable foreign currency conversion rate than American Express Charging 8141 Kronas in Sweden resulted in a $1291.03 charge on my Amex bill. That's a 0.158583712 rate. Based on rates from other transactions the same day (0.154705882), charging the same amount using my Chase United Explorer would have resulted in a charge of $1259.46. That's a $31.57 savings!

I'll be doing a 3-way contest when I'm in Barcelona December.

When in Europe, paying for a taxi, a standard credit card from the US with a magnetic stripe would require extra time for the driver to print out the receipt for signing unless my VISA card has a smart chip (EMV technology, named for developers Europay, MasterCard and Visa). that has a PIN code. Only PIN cards are accepted on trollies, toll roads, Paris Metro ticket dispensers, unattended gas stations, etc.

No Chase cards have PINs even though they issue EMV cards as the British Airways Visa 800-577-0633 and the Marriott Rewards Premier card. However, they do not charge a foreign transaction fee. But they didn't enable the PIN feature even though it's a EMV card. So it doesn't really solve my problem overseas.

EMV cards that actually have a PIN (and no foreign transaction fee) is the Andrews Federal Credit Union GlobeTrek Visa Rewards, after, since I'm not military, joining the America Consumer Council. But it takes patience to apply, as this guy experienced.

Card Processor	Hotel	Airline
Chase	Marriott	Southwest
BofA	Choice	-
Citibank	-	American
Amex	Hyatt	-
?	Intercontinental Holiday Inn Priority Club	-
?	Starwood Westin	-

Strategy 3: Watch out for redemption limits. For example, the MBNA/BofA World Points cash back schedule shows that the "1%" really applies only when you redeem at least 25,000 points.

Is it better to cash out or use 4,900 points for 4 Regal Cinema tickets?
If you cashed out at 1 penny per point, 4900 points = $49. Divide by 4 = $12.25 per ticket.
So it's not so good, especially if you're using them to get into a discounted matinee that costs $6 per seat cash.

Strategy 4: Watch out for earning limits. The Costco American Express card gives 3% back for gasoline, but only up to $3,000. At $2.80 per gallon and 25 MPG, you're back to 1% after 26,785 miles of driving. When that is reached, I switch to my Discover card, which offers premium discount on gas some months.

For example, I was once suckered into Citibank's promise of "5% back", but after I spent over $35,000 on their card, I found out that the offer only applies until just $100 is earned, then I got NOTHING back for my purchases. I had asked for a written offer, but never got it and I was too lazy to follow-up.

Strategy 5: Redeem points quickly. Banks often change how much your points are worth (without telling you). For example, I no longer use my MBNA/Bank of America World Points card because when I signed up 2 years ago, the points were worth $50 for 5,000 points (redeemed 20,000 at a time). But today they are worth half that. I don't both with Hilton because they throw away all your points and even cancel your membership number if you don't stay with them at least once a year. Marriott doesn't do that.

Strategy 6: Watch out for redemption caps One way for cards to delay your redemption is by limiting how much you can redeem at once. If an airline ticket purchased with MBNA points is less than $400 (which is about half of domestic flights), you waste points. But if it's more, you have to pay extra money.

Strategy 7: Watch out for redemption fees World Points charges a $55 redemption fee per flight. That's like giving back 30,000 points. US Air charges $300 to redeem miles, which on short flights makes mile redemption actually more expensive than if you had just bought the ticket outright for say $280.

Fees for shipping and "handling&qout; charges when redeeming merchandise. Call and find out about these charges before clicking "Buy This" using points.

Strategy 8: No Flexibility Allowed (For You, not them) With World Points, the 25,000 points per domestic flight only applies under a very specific set of conditions: Saturday night stay, stopping in one city, no choice of airline or when you fly, an international stay lasting more than 7 days but less than 30 days, etc. No changes are allowed. You lose all the points if you don't take the flight as booked 21 days in advance (the earliest you can book).

However, if the flight is delayed to a less popular time, you still have to pay the extra miles.

Strategy 9: Watch out for black-Out Periods United charges more miles during popular times, such as 50,000 miles for a short flight on a Friday night. United once charged me 40,000 for a one-way 400 mile flight when otherwise 30,000 could have gotten me to Hawaii and back. Boy I hate United Airlines for that.

Strategy 10: Take advantage of cross-industry/partner offers.

Program Name	Cash Earned	Cost of More Points	Affiliates	US/Intl Air	Car, Other	Hotel
MBNA	(Previously) $50 for 5,000 points (redeemed 20,000 at a time)	$1 per point	Best Buy, Dell, JCPenney, Land's End	25,000/35,000 /flight +$30 each way = $170/400	2,500 per day = $25	5,000 per night = $50
American Express Blue	$25 for 5000 points	-	Sony, OfficeMax	-	Thrifty	Hilton
Chase Platinum	1% ($5) on $5000 charged	-	-	25,000 on Continental, USAir, Delta, Alamo	-	-
Southwest Air VISA	$34 for each $5000 (spent first 12 mos.) calc. at $100 flight / $14,400 from $1200 per credit * (16-4 credits on sign-up)			16 credits (doubled when booked online)	Alamo, Earthlink	La Quinta, Comfort, Rodeway

I recommend cash-back rather than airline miles / hotel night cards because of the complex and ever-changing "rules and restrictions" they make up:

I don't have Citicards listed here because Citi ripped me off big time. They offered me a "5%" cash rebate over the phone, payable after 6 months of charges. At the end of that time, after $32,000 of charges (which other cards would have rewarded me at 1% with $320) I was informed (after several phone calls) that there was a $100 cap on the rebate amount. I had explicitly asked them about this when I signed up for it, and I was told there was no limit. I asked for an email confirming that. On top of all that, they sent out a paper "notice of account conversion", and switched me to another card automatically "unless you called". These are deceptive practices.

Lessons learned: 1) Dont' trust Citibank for anything. 2) Before acting on an offer made over the phone, get it in writing.

I like the Costco American Express card. Their rebate is sent as a paper check among other offers, which I ignored. But after several months, they took the time to call me to ask why I hadn't cashed it. I then searched through past statements, went to a Costco, and cashed the $1,200 check. Sweet.

$99 gift certificate from Marriott Hotels gets you a weekend room in Residence Inn & Courtyard properties.

How Much Can I Borrow Calculator by Hugh Chou
Mortagage Calculator (Java applet) by Karl Jeacle

What Money Can & Cannot Buy

Food, but not an Appetite
Medicine, but not Health
A Bed, but not Sleep
A House, but not a Home
Decorations, but not Beauty
Luxuries, but not Culture
Amusements, but not Happiness
Books, but not Wisdom
A Church pew, but not Heaven
A Crucifix, but not a Savior
—Source unknown

Contentment!

“I am richer than John D. Rockefeller because I have all the money I want and he hasn't.” — John Muir, American naturalist

I have planted, Apollos watered; but God gave the increase. — 1 Corinthians 3:6

“godliness with contentment is great gain” — 1 Timothy 6:6

“Children, how hard is it for them that trust in riches to enter into the kingdom of God!” — Mark 10:24 (KJV)

“Keep your lives free from the love of money and be content with what you have, because God has said: 'Never will I leave you, never will I forsake you.'” — Hebrews 13:5

"Watch out! Be on your guard against all kinds of greed; a man's life does not consist in the abundance of his possessions." — Luke 12:15

“Do not wear yourself out to get rich; have the wisdom to show restraint.” — Proverbs 23:4

“where your treasure is, there will your heart be also.” — Matthew 6:21

“For the love of money is a root of all kinds of evil. Some people, eager for money, have wandered from the faith and pierced themselves with many griefs.” — 1 Timothy 6:10

"for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon [literally, treasure or riches]" — Matthew 6:24

When you ask, you do not receive, because you ask with wrong motives, that you may spend what you get on your pleasures. — James 4:3

The Yuppie Prayer

The “Prosperity Gospel”

“Wealth is the product of a man's capacity to think.” —Ayn Rand

Jeremiah 29:11 “For I know the plans I have for you," declares the LORD, "plans to prosper you and not to harm you, plans to give you hope and a future.”

Ezekiel 36:11 I will increase the number of men and animals upon you, and they will be fruitful and become numerous. I will settle people on you as in the past and will make you prosper more than before. Then you will know that I am the LORD.

Joshua 1:8 (NIV) "Do not let this Book of the Law depart from your mouth; meditate on it day and night, so that you may be careful to do everything written in it. Then you will be prosperous and successful."

Psalms 1:1-3 "Blessed is the man who does not walk in the counsel of the wicked or stand in the way of sinners or sit in the seat of mockers. But his delight is in the law of the LORD, and on his law he meditates day and night. He is like a tree planted by streams of water, which yields its fruit in season and whose leaf does not wither. Whatever he does prospers."

Matthew 7:7 (NIV) "Ask and it will be given to you; seek and you will find; knock and the door will be opened to you."

Luke 11:13 (NIV) "If you then, though you are evil, know how to give good gifts to your children, how much more will your Father in heaven give the Holy Spirit to those who ask him!"

Matthew 6:33 "But seek first his kingdom and his righteousness, and all these things will be given to you as well."

1 Timothy 5:8 "If anyone does not provide for his relatives, and especially for his immediate family, he has denied the faith and is worse than an unbeliever."

Charity

“Generosity is giving more than you can, and pride is taking less than you need.” —Kahlil Gibran

"We make a living by what we get. We make a life by what we give." —Winston Churchill

Proverbs 19:17 “He who is kind to the poor lends to the Lord, and He will reward him for what he has done.”

James 1:27 “Religion that God our Father accepts as pure and faultless is this: to look after widows and orphans in their distress and to keep oneself from being polluted by the world.”

Matthew 6:19 "Do not store up for yourselves treasures on earth ..."

Luke 12:33 "Sell your possessions and give them to the poor ...".

Luke 14:33 "In the same way, any of you who does not give up everything he has cannot be my disciple."

Hosea 6:6 “I desire kindness and not sacrifices, the knowledge of G-d more than burnt offerings.”

Luke 14:13 “But when you give a banquet, invite the poor, the crippled, the lame, the blind, and you will be blessed. Although they cannot repay you, you will be repaid at the resurrection of the righteous.”

• Ministry Watch.com provides a five-star rating of Christian ministries and a Donor's Bill of Rights
• The Tithe - God's Remedy for Poverty
• USA Today has a article on national charities starts with a glossary of terms.
  • Give.org by the National Charities Information Bureau (NCIB) publishes Tips for Givers and maintains a list of agencies which follow or ignore their Standards in Philantropy .
  • The Philanthropic Advisory Service of the Council of Better Business Bureaus (PAS/CBBB) (703)276-0100 also provides independent evaluation/assessment of charities.
  • The Charity Navigator has a database of 3,400 charities.
• To protect your rights as a donor , give only to Christian organizations which have demonstrated compliance to voluntary Standards of Responsible Stewardship and have submitted themselves to the scrutiny of the Evangelical Council for Financial Accountability (ECFA)'s Examples:
  • Wycliff translates the Bible for communities with no Bible in its native language.
  • World Relief is the international assistance arm of the National Association of Evangelicals.
  • World Vision, a relief/development agency.
• Read 54 Ways to Help the Homeless . An electronic book by Rabbi Charles A. Kroloff.
• CharityNet lists the charities of the late Princess Diana.
• San Francisco Bay Guardian's March 12, 1997 citizens guide to investigating nonprofit organizations.
• National Committee for Responsive Philanthropy
• The Internet Nonprofit Center "Information on more nonprofits than any other site in the world!"
• The Non-Profit Genie provides resources to non-profits.

Credit Reporting Bureaus

Luke 16:11
"So, if you have not been trustworthy in handling worldly wealth, who will trust you with true riches?"

1 Peter 2:13
Submit yourselves for the Lord's sake to every human institution.

Sign in the offices of a New Jersey loan company: "Ask about our plans for owning your home."

• Experian (formerly TRW) National Consumer Assistance Center 701 Experian Parkway, P.O. Box 2104, Allen, TX 75013-2104 offers free reports to the unemployed and those on welfare. From California, call 1-800-682-7654, else 1-888-EXPERIAN (1-888-397-3742) or 1 (800) 567-5470 order on-line.
  
• Equifax will send you a free copy of your credit profile if you have been denied credit or some other benefit within the last 60 days and Equifax was used in the decision process. Call 1-800-997-2493 (7 days a week). Otherwise, they charge $3-8 depending on where you live.
  
• Trans Union (800) 916-8800 P.O. Box 403 Springfield, PA 19064-0390

You have to contact each of these separately to resolve a difficulty with your credit report.

A 2003 study for the Federal Trade Commission determined that in the previous year, 3.2 million Americans' personal information had been stolen by thieves who opened new accounts or loans. On average, victims lost $1,180 and spent 60 hours resolving the problem.

To blocks a fraudster from opening an account in your name, ask for a security freeze on access to your credit reports until you personally contact the credit bureaus again (with a PIN code) to unlock it.

Quicken talks about credit reports and what to write your credit dispute. Credit Repair Kit.

The Identity Theft Resource Center in San Diego and California Public Interest Research Group has an excellent set of suggestions and guidelines for victims of identity fraud.

Questions for Reflection

Julia Cameron in her book, The Artist's Way (G.P. Putnam's Sons/New York), posed some great fill-in-the-blank statements to you uncover your true beliefs about money. I've used a few of her statements, and I added in some of my own. Complete the following phrases QUICKLY AND WITHOUT THINKING. Write down what first comes to your mind.

1. People with money are:

2. Money makes people:

3. I'd have more money if:

4. My dad thought money was:

5. In my family, money caused:

6. Money equals:

7. My mom always thought money would:

8. People without money are:

9. If I could afford it, I'd:

10. I'm afraid that if I didn't have money, I would:

11. Money is:

12. Money causes:

13. Having money is not:

14. In order to have more money, I'd need to:

15. When I have money, I usually:

16. I think money:

17. If I weren't so cheap, I'd:

18. People think money:

19. Being broke tells me:

20. Being rich tells me:

Hmm....now go back to your answers. Open up your journal or grab a sheet of paper. What is it that you learned about what you believe about money? Write down what you discovered.

Examining your beliefs about money is a vital part of living the life you truly want to live. It's time to notice the beliefs that guide your life. This week, take the time to pay attention to the role money plays in your life.

Copyright 1998. Work Less, Make More by Jennifer White

Subscribe to the new weekly email newsletter to help you Work Less & Make More written by Success Coach Jennifer White. It costs $20 per year (52 issues), but it's FREE if you buy the Work Less, Make More workbook for $29. Visit www.successu.com to order the workbook.

Resources

Get this print framed for your wall!

• coolsavings.com for coupons.
• Quicken leads you everywhere else.
• Wish List gift registry service [THWSO]
• Investment Advice Newsletters
• Free stuff
• Consumer Education for Teens This site was developed for the Washington State Attorney General's Office by the International Baccalaureate InfoTech III/IV class at Mount Rainier High School in Des Moines, WA. All of the information in this site was developed by teens, for teens. It is intended to help teenagers (a group commonly targeted by businesses and scam artists) become educated consumers, as well as giving them somewhere to turn if they have questions or get ripped off.
• Biz Quest bartering.
• Who else would give you rich for a dollar? The California Lotto on Wednesdays and Saturdays. The top numbers: 25, 17, 23, 7, 42

• Christian Financial Concepts
• Internet Check ANYONE with a Regular active checking account may pay by using this service. You do not need a credit card or special account, It's just like writing a normal check.
• Ka-Ching.com is the sound of money making sense. This web site has several tools and message boards.

Surviving Taxes

• Members of the National Association of Enrolled Agents (NAEA) 800.424-4339 (24 hours) have been granted enrollment by the IRS.

• On the Taxpayer Relief Act of 1998

“A billion here, a billion there, sooner or later it adds up to real money.” —Senator Everett Dirksen

Dictionary items:

The term salary evolved from the Latin word salarium argentium, or “salt money,” fees paid to Roman soldiers to buy the then precious commodity.

The phrase to go scot free means escaping a charge. It is from the Old English word scot—a payment, or one's share of a payment.

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