Wednesday, October 16, 2013

Personal Finance Tip: Why Bundling Insurance Is A Smart Move

All about bundling insurance
When your financial adviser talks to you about personal finance, he may never talk to you about insurance. Most advisers focus on the investment side of things, but insurance is your financial foundation. Insurance allows you to go out into the world without worrying about unlimited liability for things that might happen to you. By optimizing your insurance costs, you're setting the stage for your financial future - the more money you save here, the more you can invest or spend on things that you truly value.

Get Discounts

When you compare car insurance companies, you'll often find small differences in the way each company handles coverage, which in turn drives the way insurers price policies. However, most insurers have at least one thing in common: they will give you premium discounts for bundling insurance policies. For example, if you carry a homeowner's insurance policy, an auto policy, and a personal liability (umbrella) policy, the insurer will generally give you a discount on all three if you let the company underwrite all of them.

Insurers are willing to do this because it means that they are receiving more premium dollars than they otherwise would receive. This, in turn, allows them to invest more money for shareholders (in the case of publicly held companies) or policyholders (for mutual companies).

Insurers also sometimes make money on "the float," which is money that the insurer has collected in the form of premiums but has not yet paid out in claims. The more the insurer can make from this money, the higher its reserves. The higher its reserves, the less money it needs to charge to policyholders and the more competitive it can be in the marketplace.

Save Time

When you bundle your policies with one insurance company, you save money but you also save time. Why? Because your insurer will itemize your insurance on one bill and send that one bill to you. Often, you can elect to forgo the paper bill and just receive electronic notices. You only pay one bill, once per month. If you ever have to file a claim, if you ever have a problem with service, or if you have any questions about coverage, you only have to call one company. You won't be pushed off onto another insurer and you'll never run into a situation where your company tries to pass the buck onto another company.

You Increase Your Savings

One of the most underrated benefits of combining your insurance policies is that you end up with more savings at the end of the month. This means you have more money to save and invest for your future. With Social Security benefits expected to shrink in the future, and the costs of medical care rising, you simply cannot ignore the need for increased savings.

You don't even have to be very savvy with your investments to take advantage of the benefits either. In most cases, combining all of your policies can save you up to 40 percent. If the sum of all of your premiums is $2,000 per year, then you could end up saving $800. That's about the easiest win you'll ever get.

Daniel Flynn is a personal finance expert. He frequently shares his best tips for saving money on personal finance and car insurance companies websites and blogs for

Friday, October 4, 2013

Funds, bonds and stocks are your best investment options to begin with - Know More

investment options to choose
You may consider a number of options for investing your hard-earned money e.g. small businesses, commodities, real estate, REITS, mutual funds, bonds and stocks. By consulting an investment expert, you’re likely to gain more knowledge on your investment goals and the concept of analysis paralysis. Before you get confused about these options, you must seek financial advice to eliminate challenges that prevent you from reaching your goals and take a different approach towards your investments. By comparing each of your investment options with your investment goals, you’ll succeed in picking the right option for obtaining maximum returns.

How to select your best investment option

Opening your Roth IRA, identifying your appropriate investment vehicle and setting your investment objectives are some important steps that you need to follow through the initial phase of investment. Target date funds are a quality investment option when none of the investment options mentioned above seem right for your situation. Depending on your retirement date, your portfolio gets diversified automatically to a measured asset allocation. A target fund is a combination of various types of investments like bonds and stocks; these investments are designed to carry more risks through your young age and then convert the funds into investments that are less volatile as you near your preset retirement date. All the hard work is done by the fund manager and the investment management happens naturally.

There are some disadvantages associated with target date funds. You may create a more flexible asset portfolio than these funds. Although they may not be the best investment option for all, they are certainly a great way of starting your investments. Limited investment accounts like IRAs and 401k plans are often the best investment options to begin with. Once you gather more experience, it will be easier for you to shift your investments to a better option.

How to get started with your investment

Alongside a quality investment idea, you now have an open account, your investment vehicle and an investment goal in place. Getting started is your next step. Timing and trying the market is not a good idea if you’re going through your initial phase of investment. Going about the best investment option is often about automatic contributions that ensure dollar cost averaging; your return on investment is certainly going to enhance over a period of time. Investment management gets better when the amount depicted in your paycheck is segregated amongst various forms of investments like brokerage firms and 401k contributions. Your investment planning is affected by your contribution limits; you’ll never get deviated when your contributions are automated. Investment is not about wasting too much money in the end!

Wednesday, October 2, 2013

Forex Accounts offer Alternative Investments

An outcrop of the familiar Forex trading system is the day trading version. Intraday Forex trading strategies offer the experienced Forex trader an opportunity to build wealth quickly, often with double digit returns.

One Forex trader with years of experience as a former inter bank Forex trader at a major Canadian Bankhas built a flexible Forex day trading model using a responsible risk management policy. This differs from the average Forex broker or asset manager as it avoids basing profits on a trending Forex market.

As most Forex traders know, exit and entry strategies are not dependent only on price. Other aspects, such as market sentiment, the time and location the trade was placed as well as social and political factors, weigh heavily on the outcome of each and every trade.

An experienced Forex trader is familiar with trading strategies and can use a choice of financial indicators to manage each trade’s risk/reward ratio. He can judge when to enter and exit a trade by utilizing the tools available to him, hopefully reducing his risk of loss.

Forex brokers use different trading strategies, offer varying leverage use and follow numerous platforms. Many offer a variety of asset classes that include major equity indices, gold, commodities and more. Forex trading should be used for only a portion of an investor’s total portfolio. Diversification is always the best tool for ensuring a balanced account.