Wednesday, November 14, 2007

Make Money When Buying a House and Save Money When Selling a House

Here are a couple new, interesting websites I received an email about last week. They are designed to save you money when you sell your house and make you money when you buy it. But before we get to them and what they offer, let's review the home selling and buying process.

When a home is sold, the realtors involved (buyer's and seller's realtors) earn a 6% commission on average for selling the home. That commission is paid for by the seller. Generally, the commission is split evenly between the listing agent and the selling agent. If the listing agent also sells the home, he keeps the entire 6%. So if your home sells for $200,000, you'll end up paying the realtors involved $12,000. That's a pretty big chunk of change, but theoretically it goes to pay for all the ads, MLS fees, and other work done by the realtor.

On the buying side, you don't have realtors fees as all of these are paid for by the seller (though some will argue that they are factored into the cost of the house, I'd say the house sells for what the market declares to be a fair price and the fees are then paid by the seller after the fact.) But that doesn't mean realtor fees don't factor into your buying efforts. For instance, if both you and the seller have agents, you'll pay $200,000 for the house above while the seller will get back $188,000 ($200k - $12k; yes, there are other fees, but I'm trying to keep this simple.) But if you find the seller or he finds you without any agents involved, he is now willing to take a lower price since he'll "save" $12,000 if you buy from him. So let's say you split the difference and you buy the house for $194,000. With no realtors, you save $6k on the home and he makes $6k more. It's a win-win situation!

The two sites I noted above are designed to help you eliminate the realtors' fees as much as possible so more money goes into your pocket. Here's how they do it:

  • IggysHouse lets you list a home you want to sell on the MLS system in your area. Since this is something that's usually closed to people looking to sell their own homes and is a key to getting your house in front of agents in your area, this is a valuable service. The site also gets your house listed on (a major real estate website) and offers some other benefits as well. And all of this is FREE. You'll still need to do the other marketing for your home, but this is a big step to saving a bundle (at least 3% of the selling price of the home as you won't have an agent and maybe the whole 6% if you find a buyer without an agent). For details on how this works, visit their how we do it page.
  • BuySideRealty basically acts as your agent -- though for a much cheaper rate than normal. The reason they can do this is that they offer fewer services than a regular agent (translation: you have to do much more of the work -- see their how it works page for details) But your reward for doing so is that they'll give you back 75% of the realtor fees they generate. So in the example above, they would have earned $6,000 in realtor fees from the seller and they would give you $4,500 back. Not bad at all for doing a bit more work yourself.

I see sites like these becoming more and more common as people look to eek out whatever equity is left in their homes. It could even work for us, IF we decide to sell our house when we buy the new one and IF we had the time to do much of the legwork ourselves (which we don't.)

I'm interested in your opinions -- what's your take on these sites and/or this do-it-yourself trend?

And for those of you who are skeptical out there, no, this is not a paid post for them. Though I wish it was! ;-)

Thoughts from My Car Dealership

Last Wednesday I took my car in for its 60,000-mile tune-up. I had several finance-related thoughts about the experience during the time I waited for the car and wanted to share them all with you. Here goes:

  • I don't usually have my car worked on at the dealership since they are way over-priced. But for major work/tune-ups, I'd rather pay a bit more and have guys work on the car who really know the ins and outs of it (after all, they work on these cars all day, every day.) I also have a few other reasons I go to the dealership that I noted last year, most of which are still valid.
  • Since my last visit, the dealership has upgraded. Instead of a lounge where you can hook up your own computer and get dial-up access, they now have the dealership's computer with high-speed internet access. Cool! I could do several blogging-related tasks while I waited. Yeah, they still had the option for me to dial-up my own computer, but why bother?
  • During the tune-up, the manager came and told me my brakes were almost worn completely (95% or so) and asked if I wanted new ones (for both front and back) or wanted to get them elsewhere. If I got them here, it would be $425. Within 20-seconds, here's what went through my mind:
    1. I do trust these guys -- I don't think they would tell me something like this if it weren't true.
    2. I KNOW I can find a better deal on brakes somewhere else. I could probably save $100 or so versus their price.
    3. How long will it take me to find a place to do my brakes? And to price shop? And to take my car in again? Maybe two hours at best. Probably more like four hours.
    4. My car is here NOW. It can be done NOW for only maybe an extra hour's worth of waiting time. Even if I value my time at only $50 per hour (which I value it at more than that), I'll probably "save" $100 to $150 by having the work done here and right now.
    5. If I get the brakes done now, I have a coupon that will give me $25 extra off the price.
    6. I told him to do the work now.
  • When I paid, my bill was $800. But I knocked it down a bit as follows:
    • I had a coupon that gave me savings off different levels of spending at the dealership (I'm on their mailing list and they sent it to me.) The tune-up alone was going to get me $25 in savings, but adding the brake work bumped me up to the next savings level, so I got to save $50 off the work.

That's it. Who ever thought I'd pick up such a long blog post at my dealership? ;-)

Tuesday, November 13, 2007

Facts on Income Tax Payers

I found this article from Kiplinger's fascinating. It's on taxes and who pays what. here are the parts I found especially interesting:

  • New data show that an income of $30,881 or more puts you in the top half of the class. Earning about twice that much -- $62,068 -- earns you a spot among the top 25% of all wage earners. You crack the elite top 10% if you earn more than $103,912.
  • And $364,657 buys top bragging rights: Earn that much or more and you're among the top 1% of all American earners. Together, the top 1% earn a full 21% of the income reported to the IRS -- far more than the 13% of total income reported by the bottom 50% of earners.
  • Here's another powerful statistic about the top 1% of earners: They pay a whopping 39% of all federal income taxes. The bottom 50% pay just 3% of all income taxes.

A few thoughts here:

1. Wow, $31k puts you in the top half of all earners? Yikes! There are a boatload of people not making very much -- even when you factor out students and those living on Social Security.

2. Earning $100k puts you in a pretty good position still. I remember when a "six-figure-income" was what everyone strived for but I thought it had lost a bit of its glamour just like becoming a millionaire has. It probably has lost a bit of ground, but still, it puts you in the top 10% -- not bad. (And, by the way, being a millionaire, while more common, also puts you among the elite in terms of net worth.)

3. The bottom 50% only earn 13% of the total income. Seems like the gap between rich and poor is growing.

4. 50% of the population lives in the U.S. and gets all the government services for free basically (yeah, they kick in 3% so they do pay some.) That is simply astounding to me -- half of all people pay virtually no taxes whatsoever. I'm starting to see why some people say they don't give because they "give" to help others in the form of taxes. (No, I don't buy this argument, but I can see where it's coming from when looking at these numbers.)

Thursday, November 8, 2007

Auto Forex System Trading

Auto Forex System Trading

Auto forex system trading is the perfect strategy for investors or brokers who either do not have time to watch the market closely or trying to diversify the portfolio. It is like having a professional to trade your account for you, taking care of your profits.

Automated forex trading systems replace the need for manually buying or selling the currencies. With auto forex system trading, you can continue to focus on your own trading strategies and can take benefits of other strategies as well.

Auto forex system trading can be of different types. The systems are based on software and algorithms to generate trading signals. Different automated trading platforms use varied software to generate the trading signals. You can run the system from your own desktop or can leave the trading completely to professionals through your managed accounts.

Auto forex system trading platform is configured to automatically open and close positions at specified parameters. As the forex markets in different countries operate in different time zones, the trading practically continues round the clock. With a managed account in your auto forex system trading, whenever a trade signal is generated, your order will be placed into your account while you are away working or sleeping.

Auto forex system trading is free of the traders’ emotion. As the operations are strictly software driven, you need to concentrate on the strategic decisions, which will be executed automatically. As the automated trading platforms have proper risk management features, your trades will be secured and safe.

Many online brokers offer auto forex system trading platforms for free. You can download the system in your desktop. For a subscription or with the spread, the online broker can manage your investment.

If you purchase an automated forex trading system, the vendor may offer you free trading alert services when you can receive signals whenever a trade is identified. In many trading platforms, your order can be placed automatically, whenever a signal is generated and, therefore, you never miss a trading opportunity and save your time as well.

To take the maximum advantage of the auto forex trading system, you need planning and self-preparation. Always determine beforehand how much of your trading capital you will risk. Work on a demo account for few months before choosing the automated trading platform.

You must also monitor how your accounts are doing on a regular basis. A successful auto forex trading system should be based on low leverage and multiple entry. Always ask for the history and record of past performance of the auto forex system trading platform. The trading platform should be simple enough for you to operate.

About the Author

Learn how to start trading without any effort, visit Auto Forex System Trading

Forex Trading Tools: Developing Your Skills For Consistent Profits

Forex Trading Tools: Developing Your Skills For Consistent Profits

by Ryan Lee Daniels

There are several Forex Trading Tools available to a trader. Yet with the multitude of such tools, the number of traders that make it to consistent profits are still so few. So the question that begs to be asked is:

If it's not the forex trading tools that make a successful trader, then what does?

Some of the tools required to trade the forex currencies are obvious and basic. At the same time, there are quite a few others that aren't. Yet it is these less obvious tools, while not having a direct impact on your trading results, influence your forex trading success in very subtle and important ways.

One of the reasons why forex traders find it so difficult to find success is not having the ability to see how everything works together in the forex markets. This ability to see the bigger picture is crucial to find success as a trader, because it influences the way you would use your trading tools to pull profits out of the markets.

The difference between novice traders and season traders is this:

Most novice traders only think about the minimum things required to start trading, while the experienced, seasoned traders often strive to utilize the maximum of the tools available to them.

In the game of forex trading, retail traders are usually the least informed and hold the weakest power to determine how the forex currencies. On the other hand, while the banks and large financial institutions have access to sophisticated forex trading tools, it doesn't mean as a retail trader, you require all these tools for forex trading success. But you DO need to have all the trading tools required for forex trading success.

So what do you need to start your forex trading career?

The Basic Forex Trading Tools to Start Trading

These are the basic forex trading tools that you obviously need in order to trade the forex currencies, but these aren't the only tools required for forex trading success:

1. Your Forex Trading Account 2. Your Forex Trading Platform 3. Your Forex Trading System 4. Your Forex Trading Risk Capital

In most cases, novice forex traders tend to think that this is all they need to become hugely profitable in the forex markets. It's so simple and easy, right? It's true, this is all you need to start trading. But what is not so obvious is that while this is what you need to START trading, it's not necessarily what's needed to be trading profitably!

Forex Trading Success is a journey where you, as a trader, are on a path of learning and growth. It's a journey from point A to point B, where point B is consistent forex trading profits.

To think that a novice trader can become wildly successful with just these four trading tools alone is thinking a towering 100 story building can be constructed with only a pencil, a piece of paper, and 4 bricks. Other elements and tools are used to build your forex trading business but because they are in the background of what's going on, they can be easily missed or dismissed in terms of their importance.

If these four tools are what is required for trading success, then we would have a lot more traders being profitable and rich, wouldn't we?

Developing Your Skill To Use The Basic Forex Trading Tools

Developing your skill as a forex trader is necessary to become successful. The quality of the product is due to the quality of the craftsman. The more highly skilled you are, the more you are able to understand and utilize the nuances of forex trading tools.

On the surface, it may seem the skills required to use these forex trading tools would be the technical knowledge. Knowledge of how your trading platform works, how technical indicators are constructed, what they mean, and what would be the best ways of putting them together to create a forex trading system.

However, forex trading success isn't a two dimensional thing consisting only of your trading account and a trading system. In reality, it's a multi-dimensional thing that encompasses you not just as a trader but as a complete person. You have to learn a forex trading system suitable to you, the appropriate type of risk and money management strategies, developing a daily forex trading routine that matches what you want to accomplish in congruence with your actual life, maintaining your records and other supporting skills.

And these skills as a trader can't be bought with money. It takes time, effort and discipline to develop your trading skills. Not only that, it does require actual trading experience to understand what emotions you go through and how to manage them in your forex trading business.

While it may seem to be a lot of work and study, it's definitely possible to become a successful forex trader. Just don't expect it to happen overnight, or you will be sorely disappointed. Even the best of traders are constantly learning new things about the markets, the subtleties of trading and of themselves as traders and persons. Although with the right forex trading education and mentorship you can reduce the time taken, in most cases you'll still have to go through the experience of learning what it takes to be a successful forex trader.

Wednesday, October 31, 2007

Schwarzenegger has to cut costs

Schwarzenegger has to cut costs

How Will Schwarzenegger correct the California budget deficit?

The main reason that Gray Davis was recalled in California is the budget deficit for which he is largely held responsible. Now Arnold has vowed to make the budget his first priority.

This morning he said, "We don't know exactly what the current operating deficit is. It went from $7 billion to $8 billion to $10 billion and just this morning I found out if this court case goes wrong, it could go to $20 billion."

He was referring to a lawsuit that would stop the state from issuing bonds to fund the current state deficit.

I admire the fact that Arnold wants to comply with the law, and work towards a balanced budget for California, but anyone in business knows that there are two ways to close a deficit. They are 1.) Increase revenues and 2.) Decrease expenditures.

There are a couple of glaring problems with Arnold's "plan":

1. Arnold has vowed not to raise taxes, and to abolish the recently passed auto licensing fee which nearly tripled the auto taxes in California. The auto tax was expected to bring in somewhere in the neighborhood of $4 billion, an amount that would significantly reduce the debt. This means that not only will Gov. Elect Schwarzenegger not be able to increase revenues, he is starting even farther "behind the eight-ball" than expected.
2. There are only a few ways to decrease expenditures. Arnold could eliminate government jobs, which I am sure will go over very well. He could decrease correctional agency funding, perhaps by releasing non-violent offenders into parole. Ofcourse, the health and human services funding makes up 28% of the state's budget. I'm sure everyone would understand if Arnold cuts health and human services... which brings me to the real reason that I began writing this evening:

There is a great liklihood that health and human services budgets will be cut. We cannot forget that Schwarzenegger is a Republican. "Privatization" is the mantra. What will happen to the elderly who depend on state-run programs as a major part of their lives?

While it may be too late for them, it is important that we all take some time to prepare for our own future. You never know when a less-than-qualified candidate will be chosen to make the tough decisions that directly affect your life. Long Term Care Insurance puts the reigns of your life back into your hands. Don't rely on the compassion of the politicians in power.

Monday, October 22, 2007

EUR/USD Fluctuations Continue

EUR/USD retraced back to 1.4200 level today after some very disappointing housing data came out in U.S. Overall situation continues to remain uncertain with the EUR/USD ranging between 1.4050 and 1.4250. It now formed a clear plateau pattern on the daily chart marking some major break in the Euro vs. Dollar struggle.

Housing report for September showed a further downfall in this economics sector with the decrease in both housing starts and building permits numbers exceeding pessimistic market forecasts. There were 1,191k housing starts (against 1,285k expected) and 1,226k new building permits (against 1,300k expected) this September.

Contrary to real estate sector bad news September CPI report showed a better than expected value - 0.3% against 0.2% expected, and that's from the -0.1% in August.

Crude oil inventories report for the October 8-12 week showed a major increase in commercial oil inventories - 1.8 million barrels, which can easily compensate for the previous decrease by 1.67 million barrels.