Posted by Ryan on September 4th, 2008 in Credit and Debt

Did you know that 70% of all credit reports contain inaccurate or incomplete information? What’s even scarier is that 1 in 4 people are denied credit because of this.

Play this message to find out what we’re going to do about it.

So to recap:

1. Click here to open www.annualcreditreport.com in a new window
2. Download your free credit report
3. Look it over in detail and highlight anything that surprises you
4. Leave a comment below about what surprises you found and what one question you would like to ask a credit expert

I’m going to try to get your questions answered for you soon.

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Posted by Ryan on September 2nd, 2008 in Money Management

Recently I barely avoided a potential financial disaster. Like many people who bank online and try to automate their life, all of my bills are paid through my online banking. Month after month for several years I’ve had complete faith in knowing that my bills were paid in full and on time.

Until recently…

Even though my bills are paid automatically, I still find paper statements in my mailbox every month. Like clockwork, I check my mail and there it is. Knowing that it is just a bill that will be taken care of by my trusty online banking setup, I proceed to toss the bill in the shredder without looking at it.

Last week was different. For some odd reason, I had a minute in my life with absolutely nothing to do. So I decided to kill time by actually looking at my mail. It took 30 seconds to turn nothing to do to a raging headache that made me late for my weekend travels.

I looked at my mortgage statement and noticed that I was past due on my payment and had a $50 late fee assessed. I figured it had to be a mistake and promptly got on the phone with customer service.

This “mistake” ended with me driving to my branch to speak with my personal banker in order to get everything fixed. Turns out the property value of my house was re-assessed and the escrow payment my bank requires me to pay increased. Since my automatic bill payment sent a partial payment for the old amount, my bank considered the payment outstanding.

In the end there was no harm done other than my blood pressure going through the roof, but of course this could have been completely avoided if I took the time to open my bills.

Long story short, just because my bills are being payed automatically, I’ll be sure to not get too comfortable in knowing everything is being taken care of. In the end, it’s ultimately my responsibility to make sure my bills are paid on time and in full - not my computer’s.

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Posted by Ryan on August 29th, 2008 in Spending and Saving

Next to stuffing your hard earned money under your mattress, your savings account may be the worst place to put your money.

Inflation rises at 3 - 4 percent a year, which means for every $1 you have now, it will only be worth $0.96 next year, and the following year it will only be worth $0.92. That may not seem significant, but over the course of time, the value of your money decreases significantly. According to this inflation calculator, $1 in 1997 only has the buying power of something that costs $1.31 in 2007 dollars. In other words, over the course of 10 years your dollar is only worth $0.79.

Imagine that your $100,000 savings is only worth $79,000 just because it was parked in a simple savings account that paid less than 1 percent interest on your hard earned money.
As someone who is working to increase their net worth, you obviously want to get the highest return for your money. However, the potential rate of return generally comes with risk or tying up your money for a specific amount of time. Of course you can’t lock up all of your money in investments because you need cash on hand to pay your bills and get through life.

Your excess cash, however, should be in an account that at least keeps up with the rate of inflation. Otherwise you are losing money as time goes by. An online high-yield savings account, for instance, gives you the benefit of being able to access your money with an ATM card, while providing a nice yield that will keep up with or exceed inflation rates.

Millionaire Money Habit: Keep only the money you need to get through life in a simple savings or checking account. Put the rest of your savings in an account that will beat inflation rates so you are not losing money by having your cash stashed in a low-yielding account. If you can stand to not touch the money for 10+ years, your best bet may be the stock market. Otherwise seek fixed-income investments, such as a CD, or a high-yield savings account like HSBC.

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