Reverse Mortgage vs. Payday Loan, the Hard Facts

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Reverse mortgage vs. payday loan Reverse mortgages and payday loans have significant similarities and differences. If you're looking for the hard facts, you will find them here. Both reverse mortgages and payday loans can be used when you are in need of immediate money, although reverse mortgages can be drawn monthly too, which would provide long-term financial stability. 

Reverse mortgages are primarily for those of retirement age.

A reverse mortgage allows you to draw money in a lump sum or you can receive monthly payments. Reverse mortgages are common for those of retirement age because it provides an opportunity to starting preparing for retirement living. Often times, retirees will invest in property, RV's, or park model homes so that they can retire without financial struggle. If you are not ready to sell your house but you'd like to purchase something for retirement, a reverse mortgage provides that opportunity.

Reverse mortgages are based on the equity of your home.

In order to receive a reverse mortgage, your home has to be appraised at a significantly higher price than you currently owe on your home. This may not be possible with the current condition of real estate. During the economic recession, homes lost a large majority of their value and their equity quickly plummeted. Before you consider a reverse mortgage, it's a good idea to have the equity of your home appraised so that you can see where you stand financially.

Reverse mortgages have interest that will be added to your mortgage.
Like all loans, a reverse mortgage has an interest rate. This interest will be accrued to your mortgage, so it's important that you keep a close eye on the interest that you are accumulating. Essentially, your reverse mortgage will draw equity away from your home, since your mortgage will continuously increase because of this interest. This makes reverse mortgages unfavorable to some, but if you're not in a position where you feel comfortable selling your home, they may be the perfect option.

Payday loans often earn their money from repeat loans.

Payday loans have a poor reputation among many financial advisers because payday loan companies earn about ¾ of their income from repeat loans. This is often because payday loan companies encourage borrowers to continue drawing loans when they cannot afford to repay their initial loan's fees. 

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This leaves the borrower helpless to the high interest rates of the payday loan and they often struggle to break free from the amount of debt they have accumulated.

Payday loans have high interest rates; the lowest APR cap is 156%. (Texas)
Payday loans have very high interest rates but they are intended to be short-term loans. The lowest annual percentage rate cap is found in Texas and is 156% of the loan. While you would never take an entire year to repay a payday loan, this helps increase the extent of the interest. Payday loans typically have a two week payback period. This means you must recover the funds to pay back the loan and all fees associated with the loan within a two week period.

Payday loans provide short-term financial relief and are typically easy to obtain.
Payday loan companies are not very picky when it comes to accepting borrowers. Unlike banks and financial institutions, credit is not a huge factor when it comes to approval. If you have a bank account, proof of income and a driver's license to identify yourself, it's very likely that you will be approved. As far as we know, there are no payday loan companies that perform a complete and comprehensive credit check. In fact, it's usually harder to obtain a credit card than it is to obtain a payday loan.

Does Your Tax Preparer Have the Proper Credentials?

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As we approach the end of the year, many people are starting to prepare for income tax season. Whether you prepare your own taxes or have a professional do it you need to gather the necessary documents. 

I use an accountant to do my taxes. I used to do my taxes myself but they became so complicated I hired an accountant. It's not cheap but I can feel sure they are done right. The last thing I want to have is any encounters with the I.R.S.

All individuals who prepare tax returns for compensation must have a preparer tax identification number (PTIN). This requirement generally applies to all attorneys, accountants, and enrolled agents who prepare returns, as well as to registered tax return preparers who are authorized by the IRS to prepare returns.

In order to become a registered tax return preparer, an individual must pass an IRS competency examination. The PTIN requirement also applies to “supervised preparers” who do not and are not required to sign returns, but who are employed by an attorney or CPA firm and who prepare returns under supervision.

Enrolled agents and registered tax return preparers are subject to continuing education requirements set by the IRS, while attorneys and CPAs are subject only to continuing education requirements (if any) required to maintain their professional credentials.

What is an Enrolled Agent?

Enrolled agents (EAs) are the only federally-licensed tax practitioners who both spe­cialize in taxation and have unlimited rights to represent taxpayers before the Internal Revenue Service. These tax specialists have earned the privilege of representing taxpay­ers before the IRS by either passing a stringent and com­prehensive three-part examination covering individual tax returns, business tax returns and representation, practice and procedure, or through experience as a former IRS em­ployee. All candidates are subjected to a suitability check conducted by the IRS.

What are the differences between enrolled agents and other tax professionals?

The enrolled agent is the most expansive license IRS grants a tax professional. Enrolled agents are generally un­restricted as to which taxpayers they can represent, what types of tax matters they can handle, and the IRS offices before which they practice.

Unlike attorneys and CPAs, who may or may not choose to specialize in taxes, all enrolled agents specialize in taxa­tion. While CPAs and attorneys are licensed by the states, enrolled agents and registered tax return preparers are fed­erally licensed. Registered tax return preparers must pass a basic, one-part exam and complete a minimum 15 hours of continuing education per year. They do not have the unlimited representation rights held by enrolled agents, CPAs and attorneys. The enrolled agent license is the highest credential the IRS issues.

The advantage of working with an enrolled agent lies not only in the depth of experience and understanding of how to prepare a tax return, but the knowledge of tax law that may be used to represent taxpayers before the IRS. If you get a letter from the IRS, or worse, are audited or are the target of a collection action, your EA can speak directly to the IRS on your behalf.

How can an enrolled agent help me?

Enrolled agents advise, represent and prepare the tax re­turns of individuals, partnerships, corporations, estates, trusts and any other entity with tax reporting require­ments. EAs prepare millions of tax returns each year and their expertise in the continually changing field of taxation enables them to effectively represent taxpayers audited by the IRS. In addition to tax preparation and tax representa­tion, many enrolled agents offer other business-related ser­vices which may include:

• Bookkeeping
• Financial planning or budgeting
• Payroll services
• Financial statement preparation
• Mortgage assistance

Are enrolled agents required to take continuing professional education?

In addition to the stringent testing and application pro­cess, the IRS requires enrolled agents to complete 72 hours of enrolled agent continuing education every three years to main­tain their licenses. The National Association of Enrolled Agents (NAEA) raises the bar even further in that its members are required to complete at least 90 hours in a three year period.

What are the key points to remember when hiring a tax professional?

Your tax needs are best served by an enrolled agent. How­ever, no matter who you hire there are certain things to keep in mind.

• Always use a qualified professional to prepare your return.
• The preparer should always sign the return and include their Professional Tax Identification Number (PTIN).
• Beware of preparers who encourage you to lie or otherwise modify your information in order to get a bigger refund.
• The taxpayer is responsible for what’s on a tax return.
• Enrolled agent continuing education requirements are met.

Reputable preparers will ask to see receipts and will ask multiple questions to determine whether ex­penses, deductions and other items qualify. By doing so, they are trying to help their clients avoid penalties, interest or additional taxes that could result from an IRS examination.

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Adding Your Children Onto Your Insurance Policy: Pros and Cons

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Many parents in their forties and fifties have older children who are ready to buy their first car, graduate or enter college, and/or getting prepared to live on their own for the first time. 

At a time when parents seek to save for retirement, costs for older children are taking a chunk out of their savings: Buying their teenager a vehicle, paying for college expenses, helping with costs of the child’s new living arrangements, and car insurance. 

Navigating finances at this stage is quite the juggling act. After all, parents who are fast approaching retirement need to find the balance between their budgetary expenses, saving for retirement, and contributing to an older or adult child’s expenses and needs. 

Sometimes parents have to draw the line and give their child the entire responsibility of providing for themselves. When it comes to car insurance there are advantages and disadvantages for both parents and teenagers of sharing an insurance policy. Let’s break it down. 

Pros for Parents 

· If the parent’s name is on the title of the vehicle or on the loan, they should be cognizant of proper protection against major unexpected loss. By having control over the amount of coverage on the vehicle, parents can be assured of proper coverage. As long as a parent’s name is associated with ownership, they will have a legal responsibility for any liable losses.

· The child’s cost for their portion of the car insurance will likely be far less, which may mean that parent’s won’t have to help them out as much financially. 

Cons for Parents 

· The cost is obviously the biggest drawback if parents are the ones who have to be responsible to pay the premium.

· In the same way that a parent can be liable as a co-owner named on a title or loan, as a policyholder, a child may cause an accident and the injured party may try to go after the parent as one of the policyholders, even if their name isn’t on the vehicle. If the parent’s name isn’t on the title or loan, they might want to consider having a separate policy for the child. 

Pros for Children 

· The most obvious benefit to adult or older children listed on their parent’s policy is that the cost of the car insurance they are responsible for will be typically far less than if they had to pay for a car insurance policy on their own.

· Older and wiser parents often carry better protection for liability. Younger drivers who often pay the highest premiums will try to get by cheap and cut coverage as low as possible.

· The good thing about having the child start out on their parent’s policy is that they can “spin off,” taking valuable discounts from their parents to their own policy. 

Cons for Children

· On the rare occasion that the parents have a poor driving history, the child might be paying more for insurance than if they were on their own policy.
· If the parents find themselves in a large lawsuit for auto liability, the child could be pulled into it if the parent isn’t covered for the judgment award. 

Parents don’t often find the silver lining in their car insurance premiums doubling by adding an adult or older child as a driver or co-owner of one of the vehicles. However, having the child/children covered on the parent’s insurance policy does have its advantages, too. 

Carefully weigh the options and discuss with the agent and insurance company all the possibilities before making a snap decision. Your retirement income and investments depend on smart financial decisions you make now. 

Steven Weinberg is licensed insurance and expert writer at Car Insurance Calculator where he covers typical consumer questions as well as a weekly blog on insurance news for US consumers from all states. 

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Give a Home a Fresh Look Without Breaking the Bank

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Even newer homes lose their luster over the years; flooring shows wear in high-traffic areas, chrome bathroom fixtures that looked so smart and modern fifteen years ago, now look plain and utilitarian, better suited for a cheap roadside motel. The era of pink bathtubs has come and gone, and 1970s wall paneling is best left in the last century.

Homeowners can update the look, function and value of their homes without the expense of a total renovation. A room-by-room assessment will identify the specific areas that need addressing. Assuming a home’s structure and mechanical systems are sound, most homeowners will find they can update their castle without emptying their wallets.

The Front Door

High-end homes often feature ornate oak doors with etched-glass inserts, making the half-lite steel doors found on so many homes seem a poor relation. Repaint that steel door with a color similar to wood. Once the paint has dried, swipe the surface with a coat of wood stain; this will add a faux wood-grain texture. Complete the project by applying a decorative window film to the door lite to get the etched-glass look.

The Kitchen

Revamping a tired kitchen will improve a home’s value and make life more pleasant for the cook in the house. Replacing dated cabinets is expensive and usually unnecessary. Sometimes a coat of paint and new hardware is all that is needed to bring a kitchen into the 21st century. A more expensive route is to replace the cabinet doors and the surrounding veneer. This may be the best approach when dealing with hopelessly outdated cabinet styles.

Replacing countertops requires carpentry skills that are beyond the reach of most homeowners, but money spent on hiring a contractor to replace that old, speckled laminate will increase the home’s value more than the cash out-lay.

The Bathroom

A few quick changes in the bathroom — a new toilet seat, new lavatory and tub faucets, new shower doors — can make a big difference is the room’s appearance. Homeowners with outdated or stained bathtubs may wish to investigate resurfacing kits. These epoxy-based products apply like paint and can cover that dated tub with a resilient finish similar to porcelain.

Flooring

A steam cleaning can often bring wall-to-wall carpeting back to life, but there are many other options for homeowners seeking a cleaner look. New laminate flooring are relatively inexpensive and often can be a do-it-yourself weekend project.

Older homes are often hiding solid wood floors under worn and stained carpeting. Lifting the carpet in one corner of a room may reveal a hidden treasure of wide pine boards. Light sanding and a coat of polyurethane will give the room a clean look, suitable for country or modern décor.

Homeowners that find plywood under their old carpet may discover, with smaller rooms, a coat of stain over the plywood, followed by polyurethane, creates a warm, rustic look. The lack of texture in plywood makes it unsuitable as a floor covering for larger areas.

Wall Paneling

Removing wall paneling is a major chore, and often adhesives applied to the paneling at installation has marred the sheetrock underneath. An easier way to update these walls is to paint. The grooved paneling, covered with a fresh coat of paint, will have the look of expensive wainscoting or beadboard without the price. For homeowners that wish to wallpaper, the grooves in old paneling can easily be filled in with joint compound to give the wall a smooth surface.

Author’s Bio: Jeff Hall is a freelance writer, professional blogger, and social media enthusiast. His blog Homeownersinsurance.org focuses on insurance. You can follow him on Google+

Mediterranean Cruises – The Thrill of a Lifetime

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If you have never cruised the Mediterranean then you are missing the thrill of a lifetime. Each morning you awake to a new world while enjoying the comforts of your hotel on the sea with all your meals, accommodations, and all kinds of entertainment available to you. 

If you love to sample different cuisines, study interesting cultures and tour historic locales then a Mediterranean cruise is a travel adventure that you cannot pass up. You can explore this beautiful region on cruise ships departing ports in Greece, France, Italy or Spain. 

When Is The Best Time To Go 

Even though the traditional season for Mediterranean cruises runs from May through October, it may sometimes begin earlier in March and end in November. Should this be the case, some cruise ships may sail south to the Canary Islands. Only a few ships sail all through the year, however, if you happen to book a large cruise ship, and you like swimming be certain that the ship's pool can be covered by a glass dome so that you swim no matter what time of year you happen to be sailing. 

Many cruise ships sail out Europe all year, while others change ports depending on the season, for example sailing the Caribbean in the winter and the Mediterranean in the summer, where the prices and operating costs are usually higher. Even though several of the resort vessels are quite large, most vessels sailing the Mediterranean are generally mid-range (with capacities of 600 to 1,600 passengers) or small (with capacities of 200 to 600 passengers), depending on the port's size. If you happen to select a large cruise ship (housing from 1,600 to 5,000+ passengers) you will be restricted to the larger, busier ports. 

If you plan on bringing the kids along a large cruise ship has will have more facilities and activities for kids, but if you want a more relaxed experience a mid-sized ship is your best bet. It’s easier to get off and on as you visit each port and the quality of the food is usually better. 

Mediterranean Ports of Call 

Many high-end cruise companies have Mediterranean cruises available originating in Monte Carlo, which is found between the Mediterranean Sea and the Alps. Cruises from Rome leave from a port town called Civitavecchia. From this port it is about an one hour ride by bus into Rome, an engrossing trip you won't regret. Nearly every cruise line departs from Rome then going anywhere in the Mediterranean region. 

Another popular route, cruising into Venice by way of the Giudecca Canal, is an happening you will not want to fore go. The cobblestone thoroughfares, criss-crossed by water channels, and numerous historical bridges, sets this city apart as a delightful place to see on foot. 

The Mediterranean is a fabled region full of unending treasures and history just waiting to unfold before you. No matter what piques your interest, it could be the stark ruins of Athens and Rome, or the Holy Land with its sacred locales; or even the beautiful sun-drenched beach fronts of the Greek Isles, it is not an experience to be missed. Traveling on a Mediterranean cruise should be on everyone's bucket list.

Some Useful Strategies for Hard Drive Recovery Software

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Isn't it always the way . . . you start looking around for hard drive recovery software as soon as a disaster happens. Your hard drive crashed and you lost all your data. Unfortunately, there is no magic keystroke or built in process for recovering your data so you need to decide the best strategy for recovering your lost data. 

Doing Your Own Hard Drive Recovery 

When you're hard drive crashes how do you find the best recovery software? Researching software reviews online is a good way to start. As you read through the reviews be sure they have some useful information about the product. PC World reviews are generally pretty helpful to readers. Their reviews give you a good idea about the quality of the product and don't try to be very promotional. Other good websites to consult for dependable reviews are Softonic.com, CNet, Tucows and Computer World.

Make sure the software has the ability to retrieve data from a formatted drive, and FAT or NTFS file systems. The data recovery process should give you the ability to move the data and store it on a removable drive or other type of storage system. 

There are also other helpful features to look for in hard drive recovery software like disk imaging, preview mode, and cloning. These particular benefits will make the retrieval of data more effective. Be certain the product you choose retrieves data by reading rather than writing to your formatted drive. Some software products incorporate writing into the process which tends to put your lost data at great risk. If you can, try to get your hands a trial version of the software in which you are interested so that you can evaluate its effectiveness. 

Using a Hard Drive Recovery Specialist 

If you are feeling overwhelmed with the task of data recovery, or you have no clue what to do next, then it's best to take your machine to a recovery specialist or computer shop. Even though this is a very dependable strategy for retrieving corrupt data, it can be very expensive. Many data recovery specialists charge high rates, oftentimes with extended turnaround times. If you happen to be in a situation where you need super fast data retrieval you may have to pay a rush charge to get the task done quickly. 

Never Disassemble Your Hard Drive 

No matter how you choose to proceed, never disassemble your hard drive unless you have experience. You could accidentally destroy all the data you were trying to save. 

Unfortunately, hard drives fail for all kinds of reasons, the most common of which tends to be human error. Typical of these errors are accidental file deletions, dropping laptops, or the dreaded “spilled cup of coffee.” Another culprit is sudden electrical spikes that may occur often enough to put your means of data storage at risk. 

Fortunately, there are hard drive recovery specialists available who can retrieve data from these devices 95% of the time. Sometimes they can even restore the disk drive as well. But of course, the best way to guard against drive failure is to back up all your data and be certain it is securely protected. However, it's good to know that if disaster strikes there are reliable hard drive recovery pros who can help.

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