3 Primary Causes For Debt

For many people, the word “debt” sends a shiver down their spine. They either have unmanageable debt or have escaped a frightening situation where this was once true for them.

It’s not a word that is used lightly in a conversation. The reason debt triggers such an emotional charge is because we link our well-being and survival to money, and when we owe more money than we are bringing in, then we feel a sense of dread.

Options for Debt Relief

If you have debt, you have 3 main options:

  1. Self-help. Help yourself through learning money management techniques like budgeting. You can take classes in financial literacy to get better at managing your money.
  2. Ask for help. Work with a debt relief services, like debt settlement or debt consolidation. Only work with a reputable firm, so do your research before signing up for any program.
  3. File for bankruptcy. In an interview on the Wellness Hour Consumer Report, host Randy Alvarez interviewed Michael Doan from the Doan Law Firm about bankruptcy filings as a way to cope with unmanageable debt. Mr. Doan said that many people wait too long to file for bankruptcy, filing after they deplete assets that could have been protected in a bankruptcy filing.

Reasons for Debt

There are three primary reasons why people go into debt:

  • First, it’s because of poor money management.
  • Second, it’s because of inaccurate thinking about money.
  • Third, it’s because of unexpected financial problems.

Let’s take a closer look at these 3 categories of debt.

Poor Money Management

  1. Financial illiteracy.

Money can be said to be a game with rules. If you don’t know the rules, you are going to be on the losing end of the game. Managing money is not as simple as earning a living and paying bills.

Schools don’t teach skills like how to balance a paycheck, and few parents sit down with their kids and explain the value of saving and investments and how to avoid clever sales tactics. It’s important to get an education about how money works.

  1. Financial neglect.

Education about how to earn money, how to spend it, how to save it, and how to invest it, isn’t always enough.

You may, for example, know how to create a budget, but still not do it. Yet without this simple tool, you might be spending money unnecessarily on things you don’t need while not having enough money for some necessary expenses.

Usually, the problem is not a lack of skills but a psychological issue related to not wanting to take financial responsibility.

  1. No savings.

Many people don’t like to save because of inflation. Since the purchasing power of their money dwindles over time, they are losing money by parking it into a savings account. Although they earn interest from their savings account, it is less than the rising cost of living.

However, in an emergency, like the loss of a contract if they are self-employed or the loss of a job if they work for someone can create a crisis. With 3 to 6 months savings, they could manage the sudden loss of income and find new income opportunities.

  1. Underemployment.

After a job loss, a person may have to settle for a job where they are underemployed.

However, this situation may continue for a longer time before they anticipated. In the meanwhile, they may still be paying the same expenses that they were able to handle when they had better paying employment.

Inaccurate Thinking

Sometimes debt occurs because of inaccurate thinking about a life situation.

  1. Inaccurate thinking after a financial loss.

Sometimes after an unexpected financial downturn — like reduced hours offered by an employer or a decrease in sales — people don’t adjust their expenses.

They spend the same amount as they normally did and not make any adjustments to their old spending habits. As a result, they begin to rely more heavily on their credit cards to manage the discrepancy between income and expenses.

  1. Relying on an expected windfall.

Sometimes people don’t manage their money well because they are expecting an inheritance or some other type of future windfall to compensate for their current overspending.

When these don’t materialize as expected—for instance, their relative may have only pretended to be wealthy—they find themselves short of the money they need to pay back all their expenses.

  1. Addictions.

Sometimes the desire to consume is greater than the means to do so. Besides the high cost of sustaining a drug addiction, there are also other types of addiction like gambling. A person who has an addiction finds themselves unable to stop despite the obvious negative consequences of their behavior.

Unexpected Life Circumstances

Sometimes people can be doing everything right when it comes to managing their money, but experience circumstances that completely drain their assets.

  1. Divorce.

This can be devastating for one or both parties. Besides the psychological pain, there are numerous expenses and losses associated with getting a divorce.

  1. Medical expenses.

Just a few days in the hospital can put you in debt for tens of thousands of dollars if you don’t have coverage.

  1. Death in the family.

The death of a loved one can create a lot of sudden expenses. Money has to be managed. It doesn’t matter how much or little you have, it has to be managed to avoid debt.

The bottom line is that money has to be managed:  It doesn’t matter how much or little you have, it has to be managed to avoid debt.

Why You Need to Take Control of Your Own Financial Future

The concept of a state pension is something that previous generations of workers have often relied on, as they have looked to enjoy a comfortable lifestyle once their professional careers have ended. We have recently seen a number of macroeconomic events and government proposals that have changed the financial landscape, however, creating significant issues for the workforce and their fiscal futures.

Not only has the typical retirement age for men and women increased incrementally in recent times, for example, but Chancellor Philip Hammond’s recent autumn statement also included a crackdown on pension-related tax relief. With these trends set to continue amid an uncertain economic backdrop, it is becoming increasingly clear that individuals will need to take charge of their own finances if they are to enjoy a suitable retirement.

A Look at the Latest Pension Cuts and the Steps That You Can Take to Negate Them

The latest cut was made to the annual pension allowance, which has typically served as a government top-up, for anyone aged over 55 who wanted to withdraw income from their state fund. This innovative form of tax relief is set to be slashed from April next year, however, with the annual money purchase allowance falling to just £4,000. This move marks a huge change in direction for the UK government, who as recently as 2015 introduced new pension freedoms and advantages that many leveraged to pay off their mortgages and help their children to invest in real estate.

These new restrictions represent a 60% drop in less than 2 years, however, and this is likely to hit savers particularly hard.

With this in mind, the question that remains is how can savers negate these changes? Undoubtedly, the government is responding to an austere and volatile economy by imposing these state pension restrictions, and this is compelling workers to take charge of their own financial futures. This means assuming greater control of your money and financial management plans, while also seeking out creative savings and pension initiatives that can deliver greater returns and freedom.

One of the best options in the current climate is to seek out managed portfolios and SIPPs (self-invested personal pensions), which enable you to assume control of your future and potentially achieve a superior ROI over time. These initiatives offer you access to a host of potential assets and investments, while each portfolio is managed by financial experts and tailored to suit precise risk portfolios. In certain SIPPs, individuals can save up to 0.3% per annum through the elimination of fees and commissions (which can then be reinvested into a more diverse and lucrative pension pot.

Service providers such as Tilney even combine managed portfolios with strategic, financial planning advice, which ensures that all asset classes and strategies are compatible with your future fiscal goals.

The Last Word

There is no doubt about it; the recent state pension changes will ultimately create an older workforce and reduce the amount of income that people have to live on during their retirement. While this presents a challenge, however, it is also a unique opportunity for us as individuals to take control of our financial planning and explore the wealth of innovative products that can help us to increase our pension funds. By taking charge, comparing the market and embracing flexible options such as SIPPs, you can negate state pension cuts and still look forward to a lucrative and relaxing retirement.

5 Reasons Your Online Shop is Failing

If your sales aren’t where they should be, there’s probably a reason for your lack of success. The good news is that most online business mistakes are easy to fix once you’ve identified the problem. If you’re looking to turn your brand around, here are just five reasons why your ecommerce site might be failing.
1. Your graphics are low-quality.

Seeing is believing, and if your product images are grainy, blurry or pixellated, your customers are going to assume that your products are low-quality as well. Make sure that all of your graphics are sharp and clear. Offer multiple lights, angles and zooms for customers who want to digitally examine the product. Let them feel confident about their purchase before they finalize it.
2. Your site navigation is confusing.

There are many ways to design a website, and if you aren’t receiving positive feedback about your current layout, it might be time to make a change. For example, if customers aren’t liking your vertical sidebars, you might switch to horizontal drop-down menus instead. You might also be making common design mistakes like “walls of text” or badly-contrasting colors that are hurting your site’s aesthetic. Talk to professional web developers and see what they have to say about your design.
3. You make your customers sign up, log in or complete surveys.

No one likes being forced, and making your customers sign up for your website is the digital equivalent of twisting their arms behind their backs. While it’s expected and even encouraged that you’ll advertise your rewards card or loyalty program, there’s a big difference between “Sign up for exclusive offers!” and “We need all of your personal information before you can continue shopping.” Your brand should be welcoming, comforting and familiar. It shouldn’t be annoying or intrusive.
4. Your checkout process is long and complicated.

Speaking of annoying, there’s a reason why “one-click checkouts” have become a hot commodity in the ecommerce world. Customers don’t want to jump through a thousand hoops to complete their orders, and with extra time on their hands, impulse shoppers might decide that they don’t need their basket at all. If you want better sales, your online shopping cart software needs to be streamlined for speed and convenience. Aim for a checkout process that takes three minutes or less.
5. You haven’t integrated social media with your site.

Gone are the days when social media was a passing fancy. With millions of users, platforms and features, it’s proven itself to be a driving force that’s here to stay, so you’ll need to hop on the bandwagon if you’re serious about your digital marketing campaign. Create your own social media accounts; put social media buttons on the bottom of your site; start re-tweeting and re-blogging your customers.
These are just a few of the most common mistakes of ecommerce shops. If you’re serious about improving your sales, attracting more customers and establishing yourself as a brand, use these tips to create an online shop that thrives.

Don’t Make These Tax Mistakes

Whenever the topic of taxes comes up it makes people squirm. Everyone knows that taxes are a part of being alive but no one really enjoys paying them. Yet most are compliant since being a rebel will just land you with large fines or jail time. In order to make the best of your hard earned money during tax time, be sure to follow these simple rules and tips to at least keep you in Uncle Sam’s good books but also keep more cash in your pocket.

1. Always be sure you are accurate and keep spotless records. In doing so, you are always a wide open book in case the tax man ever comes knocking. Some people try to hide little things here and there but doing so could end up costing you if you get caught. The government never looks at fraud favorably and trying to skim a little extra for yourself could land you in deep water. To go along with this, if you are using an accountant of professional tax advisor, it doesn’t hurt to check their history. If this person/company has been investigated in the past for some suspicious activity, it may indicate a more likely audit on your paperwork. Also if you are flagged with any fraud or major fines, look forward to a future under the microscope! Go with someone who is not necessarily looking for the highest return unethically, but the best tax return you can have without raising any alarms.

2. Be sure to indicate on your return or to your tax preparer if there have been any significant changes in your life. Examples would be if you have had another child? Perhaps an older family member has moved in and can be claimed as a dependent. Or perhaps a child has moved away from home. Whatever the case be aware that last years return doesn’t not necessarily have the same info on it regarding issues like these as this years.

3. Not using your 401k to reduce the taxes you owe. Contributing money to your 401k each year will save you money on your taxes. You have heard this before I am sure but many people even when they are in the position to put a few dollars away fail to do so. Even if you can only contribute a fraction of what the maximum allowed is, putting something in it will not only help you save money for your retirement but also put more money back in your pocket when your return comes.

4. If you are donating anything be sure to keep records including their proper value. Charitable gifts have tax breaks but they don’t always have to be in the form of cash donations. There are programs that allow for donating old cars in which you can claim their value on your return. What some people make the mistake of doing is claiming an old car of theirs is worth $2000 where as the blue book value may be $400. Even if you are unintentionally inflating the price, it still could come back to get you. If you are in the position to donate a vehicle, be sure to find its blue book value first and if you feel you have added significant value to it, be sure you have your receipts to back it up.

Tips to Make Right Investment for Your Child’s Future

The arrival of a child brings a bundle of happiness along with a great sense of responsibility. For parents, their children are the main priority in life and when it comes to the child, every parent wants to provide the best of everything to their children. However, the uncertainties of life can hinder the happiness of your family anytime.

In order to facilitate your child with the best of everything, a proper financial planning to ensure the financial security of life is the need of the hour for every individual. For every parent, it is the wisest decision to save the money for the children’s future so that their lives stay financially secure even in the event of the parent’s death.

With the booming inflation in the country, there are many questions that strike the mind of a parent like how to secure the future of the child? What investment options should we look for? How to provide them financial security even in the absence of the parent? Etc. Well, here, we have elaborately discussed how to make the right investments for your child so that you can secure your child’s financial future and host them with both short-term and long-term advantages.

Before you keep away all your hard-earned money, it is better that you give yourself some time to make a robust financial planning. So, the following tips will help you to make an appropriate investment planning for ensuring a stable future for your child.

  1. Have Full Understanding of your Plan

The earlier you start saving in life the better returns you will be able to reap in the long run. But it is always advisable to plan before you start your investments. As per your choice, you can choose from two type of maturity benefit: Firstly, you can opt for a money back plan that provides a guaranteed payout in the proper intervals of time even before a lump-sum payout is paid. Secondly, you can avail the maturity benefit as lump-sum payout after the completion of the whole tenure of the policy.

Certain things should be kept in mind while planning for your child’s future.  First, in order to fulfill the current and future financial needs of the child, you should plan how to collect a good amount of corpus by means of a smart investment. Secondly, protect your child’s future with a child plan so that his/her future remains secure even if something unfortunate happens to you.

  1. Set your Goal

It is very important to set a goal before you make any investment decision. However, the individual goal can vary from person to person. The financial goal set by you should reflect your estimated future needs as well. For example, if you are looking for a long-term goal that can provide capital for your child’s higher education, then you should invest in child education plan. If you want to save money to accomplish the major milestones of your child life like marriage, buying a home or supporting them in their initial careers, then investing in a unit-linked child plan is the best option. Although stock markets have a higher level of risk along with good returns, investing in stock market can turn out to be a good choice for your child in a long run.

It is important to set your priority and at least invest in one low-risk plan like public provident fund (PPF) or endowment type plans so that you have enough financial backup to easily fight the inflation from your side. The timely investment on these plans open doors of sufficient funds so that your child can easily pass every milestone in life.

  1. Choose an apt plan to secure your Child’s Future

Just investing in any plan is not enough, it is important to choose the right investment plan. Before investing in any child plan, one should consider several factors such as family income, how much money one can invest, level of risk tolerance, financial goal and for how long one can stay invested etc. So, before making your investment decisions, it is important to analyze all these factors and try to avoid investments that include higher risks. Empowering your child with proper life cover and financial protection is certain obligation of the parents that cannot be neglected.

  1. Cover the Risks of life with a low-cost term insurance plan

A child insurance plan is probably the most important instrument in which you need to invest as soon as you start your family planning. It is advisable to buy a term plan as well. As compared to the money back plan or endowment plan, a term plan provides coverage that is at least 10-12 times of your annual income.

  1. Buy a Child Plan

A child plan comes with manifold benefits. So, if you are planning for your child’s future, how can you miss on a child plan?  A child plan helps to fund your child’s higher education as well. A dual benefit of protection cum savings is offered by child education plans. Moreover, child plans are designed to offer financial security to children so that their education is not hindered by any kind of unfortunate incident in life.

In case of an emergency, one can withdraw money during the policy term. The withdrawal money can be used for any medical purpose or for medical treatment of the children in case they get ill. One of the most important aspects of child plan is that it provides security to the child from the uncertainties of life. The child plan offers a premium waiver during the policy term in case the insured passes away. In such case, the child receives the lump-sum amount as a beneficiary. The premium waiver rider offered under child plan enables it to continue without any break and the financial burden of remaining premiums is passed on to the insurer.


Rearing a child and constructing a strong financial future for him/her requires a lot of thinking and efforts. This is one of the integral parts of parenthood and is a prime responsibility of every parent. So, in order to make sure that your child’s future is secured, it is crucial to make wise investment planning and facilitate them with all the necessities in life.

5 Ways to Save Money when Travelling in Airports

Travelling can be a costly affair. While travellers are becoming increasingly savvy when it comes to finding savings on airfares and hotel rooms, certain other parts of travelling go unnoticed. Airport spending tends to be the least of people’s worries, but you can end up spending a lot of money on parking fees and other amenities if you aren’t careful. Luckily, with the below tips, you can save money even before you set foot on the airplane.

1. Check out the airport before travelling

If you are travelling from or to a new airport, it’s a good idea to check out the floor plan and the amenities available at the airport. We tend to spend more when we need to make quick decisions and rushing can be a costly thing. But if you are aware of the airport, you can be smarter about your parking and even shopping in the airport. You know where the cheaper shops and restaurants are and you won’t need to spend extra just because you couldn’t find anything cheaper.

2. Consider paying for a first-class lounge

It can sound a bit counterintuitive, but paying a bit of money for a first-class lounge may save you money. Staying in a first-class lounge is cheaper because you get to enjoy a quiet, comfortable surroundings with free food and drinks. Most lounges cost about £20 for adults and £15 or less for children. If you are travelling as a family, you can save a lot, since you won’t need to be buying snacks and treats for the kids.

3. Utilise airport discount codes

Airports have special offers available for many services and utilising them can save you money. You should check the airport website to find voucher campaigns for the shops or the restaurants. Try to avoid last minute shopping and know about the products you want to buy and the things that aren’t necessarily any cheaper.

4. Book your parking ahead of time

If you just turn up at the airport to park, you will end up spending the maximum amount of money on parking. Airports don’t tend to offer discounts on the day and you definitely should book in advance. Shop around to find the best deals and utilise voucher code campaigns. You can slash up to 30% of your booking fee by taking a bit of time before the trip to view the quotes.

5. Check for alternative car parks and other deals

You can also save by avoiding the airport parking system altogether and opting for an alternative car park. You just need to browse through discount vouchers and deals at JetParks Airport Car Park offering nearby parking at most UK airports. If you book the service in advance, you can enjoy further perks with your deal. If you can, you should also consider travelling to the airport by using public transport.

Spending at airports can quickly increase the total cost of your holiday, so you want to be smart about it. Don’t just show up and go with the flow, but plan your spending in advance and take advantage of the option of booking beforehand.

How long will it take to receive my Federal Tax ID?

Running a business can be a time consuming and stressful affair. This is especially true when you find yourself in need of an Employer Identification Number (EIN) in order to do something vital like file your takes or even open up a business bank account. Thinking about filling out an application and then waiting for the IRS to respond is enough to raise your blood pressure, but do not fret! You can often obtain your EIN as quickly as the same day you apply, and there are even easy solutions when it comes to how to check EIN status.

How To Check EIN Status

If you already have an EIN number, or have submitted an application, but do not remember the number, there are things you can do. First of all, you might consider looking through old tax forms or payroll information, as the number is commonly included in these items. You could also give your bank a call. Because an EIN number is commonly needed to open a business bank account, the bank itself is likely to have it on file. You can even call the IRS and ask for help to check the status of your EIN number.

Apply For A Federal Tax ID

When you need to apply for a federal tax ID, you probably need to receive your EIN number as quickly as possible. This is why it is important to find a service like IRS-EIN. They take the application process and optimize it so that you spend less time answering questions and more time using your new EIN to help keep your business running.

If you need to apply for a federal tax ID, contact IRS-EIN-Tax-ID.com today! They understand the process inside and out, and will be happy to help you obtain quickly and securely.