MONEY MATTERS

American Debt Collection: Spiraling Out of Control

Posted on June 6, 2012 by Jason (Frugal Dad)

 As someone that’s been in and out of debt, I know well what it feels like to be hounded and haunted by creditors. And I’m terrified over the increasingly aggressive measures collectors are taking to recover payments. U.S. collection laws are loose, but there are many lines they cannot cross. It’s important for every borrower to know the difference between persistence and harassment.Collector abuse is definitely on the rise. Since the recession, formal complaints against collectors have risen 66% and dozens of private debt collection agencies have lost licenses for their abusive collection methods. This is due in part to the major shove big banks have made since 2008 to recover billions in unpaid credit and penalties. Since then, most of these creditors, from Chase to the Dept. of Education, have contracted collections to private firms. These smaller agencies pay collectors little and reward with commissions on debts recovered. As a result, some collectors, many in debt themselves, have been found lying, stalking and even threatening to make collection quotas.

I really hope that our latest infographic on this surprisingly large and mostly-legal industry will prove as a resource to those working hard to stay a payment and step ahead of their creditors.

Click here to read more.

The 10 Wealthiest Black People In The World

By Natalie Dawson

Billionaires and millionaires aren’t always white or oil barons.  African Americans can also throw down when it comes to wealth.  To prove it, we have listed ten of the wealthiest black people in the world below listed by current estimated worth.

1. Aliko Dangote – Never heard of him?  Most Americans haven’t.  He is a businessman based in Nigeria and head man for The Dangote Group, which was founded in 1977 as a small firm.  Since then, it has substantially grown and earned Dangote himself an estimated worth of $13.8 billion.
2. Mike Adenuga – He runs Conoil Producing, the first Nigerian company to strike oil in significant quantities during the early 1990s.  He is also the owner of the second largest mobile company in the country.  A true success story, he made his first million at age 26 by selling lace and soft drinks and is now worth $4.3 billion.
3. Patrice Tlhopane Motsepe – He is another African and another billionaire.  His company is called African Rainbow Minerals and deals in gold, platinum, and other precious metals.  From South Africa, he was born royalty and became the first black partner in a local law firm in 1994.  His estimated worth is $3.28 billion.
4. Oprah Winfrey – Her own show and now her own network took this small town reporter’s dreams to places girls of her generation never thought they could go.  By investing in herself and her own show, Oprah was able to create a wealth of $2.7 billion.
5. Michael Jackson – His estimated worth is sketchy.  Although he made hundreds of millions of dollars from album sales alone, Jackson had a notorious spending habit that was also in the hundreds of millions.  However, he did purchase the rights to many Beatles songs, which are estimated to be worth between $500 million and one billion.  After his death, sales of his own music also spiked into the hundreds of millions.
6. Jim Ovia – His nickname is “the godfather of Nigerian banking.”  He founded the Zenith Banking Group in 1990, and it became one of the largest financial services provider on the continent.  He also founded a mobile company and is estimated to be worth $775 million.
7. Robert Johnson – If not for the recession, he would be higher on the list with over one billion dollars in net worth.  However, the founder of the BET network still enjoys a net worth of $550 million.
8. Michael Jordan – The “air man” is most known for being one of the best players in NBA history.  It also didn’t hurt that his brand of clothing and especially shoes are still a top seller.  Between the endorsements, investments, and more, he is worth $525 million.
9. Tiger Woods – As with Robert Johnson, if it wasn’t for his divorce and lost proceeds from a scandal, he would be farther up the list.  However, with an annual salary of $85 million, golfing legend Tiger Woods is still worth $500 million and is the youngest person on the list.
10. Bill Cosby – Proving that you can make money by telling a simple, family oriented story is the legendary Bill Cosby.  Critics believed his show wouldn’t make it past year one when the virtually unknown comedian debuted it in 1984.  Over 25 years later, he is worth $450 million and rising.

Natalie Dawson owns the site Masters Degree. She enjoys writing articles about everything in the education field.

Columbia, Maryland – August 10, 2011 – Noted personal finance expert and respected author Vernon Williams has published 425 Ways to Stretch your $$$$.  Since the average college graduate has accumulated more than $27,000 in loans, students will be particularly interested in Chapter 9 – 33 Ways to Get a Degree without Debt. The chapter is jam-packed with practical strategies for reducing the cost of tuition and finding and winning scholarships and grants.

Here’s what one parent had to say about 425 Ways to Stretch your $$$$: “As a single mom, one of my biggest concerns was how I was going to pay for my son’s education. Thanks to 425 Ways to Stretch your $$$$, I was not only able to lower the cost of college, but I was able to save money by finding college scholarships and grants for college. I also got some ideas on how to save money on everyday household expenses, as well.” -Sharon Maloney

But that’s not all. Vernon has broken the book into sections so students save almost 40 percent by only downloading the chapters in which they are interested.

For more information about 425 Ways to Stretch your $$$$$, please click www.howtocutyourexpenses.com.

About the author

Vernon Williams has lived his passion of helping consumers achieve financial success for over 20 years. He has taught hundreds of workshops on goal setting, setting up and managing a budget while eliminating unnecessary expenses. He has discussed money-saving tips on several media outlets including National Public Radio Station WEAA and Comcast’s Money Matters Today program.

In addition to 425 Ways to Stretch Your $$$$, Vernon is the author of 3 Rules that Guarantee Financial Success.

Vernon has a master’s degree from Johns Hopkins University and he is a sought after speaker by both public and private sector organizations.

Vernon is a member of the American Council on Consumer Interests and the Better Business Bureau.

Visit Vernon at www.howtocutyourexpenses.com.

U.S. Racial Wealth Gap Quadrupled Since Mid-1980s, New Study Finds

The wealth gap between white and African-American families increased more than four times between 1984-2007, and middle-income white households now own far more wealth than high-income African Americans, according to an analysis by the Institute on Assets and Social Policy (IASP) at Brandeis University.

IASP, in a research brief, also reported that many African Americans hold more debt than assets and at least 25 percent of African-American families had no assets to turn to in times of economic hardship. The fourfold increase in the wealth gap, it said, reflects public policies, such as tax cuts on investment income and inheritances, which benefit the wealthiest and persistent discrimination in housing, credit and labor markets.

“Our study shows a broken chain of achievement. Even when African Americans do everything right — get an education and work hard at well-paying jobs — they cannot achieve the wealth of their white peers in the workforce, and that translates into very different life chances,” said Thomas Shapiro, IASP director and co-author of the research brief.

“A U-turn is needed. Public policies have and continue to play a major role in creating and sustaining the racial wealth gap, and they must play a role in closing it,” said Shapiro, author of The Hidden Cost of Being African American: How Wealth Perpetuates Inequality and the co-author of Black Wealth/White Wealth.

Wealth, what you own minus what you owe, allows people to start a business, buy a home, send children to college and ensure an economically secure retirement. Using economic data from the same nationally representative set of families from 1984 to 2007, the IASP analysis found that the real wealth gains and losses over the time demonstrate an escalating racial gap.

Over those 23 years, it said, the racial wealth gap increased by $75,000 — from $20,000 to $95,000. Financial assets, excluding home equity, among white families grew from a median value of $22,000 to $100,000 during that period while African Americans saw very little increase in assets in real dollars and had a median wealth of $5,000 in 2007.

Summing up all assets and debt, one in 10 African Americans owed at least $3,600 in 2007, nearly doubling their debt burden in real terms since 1984, IASP said.  The growth of the racial wealth gap significantly affects the economic future of American families, it said. The current gap is so large that it would pay tuition at a four-year public university for two children, purchase or make a solid down payment on a house, or provide a nest egg to draw upon in times of job loss or crisis.

“The gap is opportunity denied and assures racial economic inequality for the next generation,” said Tatjana Meschede, a co-author of the policy brief.

Notably, IASP’s analysis found that by 2007, the average middle-income white household had accumulated $74,000 in wealth, an increase of $55,000 over the 23-year period, while the average high-income African-American family owned $18,000, a drop of $7,000. That resulted in a wealth gap of $56,000 for an African-American family that earned more than $50,000 in 1984 compared to a white family earning about $30,000 that same year.

Those figures, IASP said, make it clear that higher income alone will not lead to increased wealth, security and economic mobility for African Americans. Consumers of color face a gauntlet of barriers — in credit, housing and taxes — that dramatically reduce the chances of economic mobility, it said.
Indeed, the data indicate that the general trend in lending, in which consumers of color pay more for accessing credit, increases their debt and blocks opportunities to move forward, putting them at a severe economic disadvantage. These are concerns that must be addressed through the creation of a Consumer Financial Protection Agency, now being debated in Congress, and other policy changes, IASP said.

“The data suggests we need renewed attention to public policies that provide real opportunities for advancement by reducing barriers to mobility inherent in our tax system and increasing transparency, regulation and access in our housing and credit markets,” said Laura Sullivan, another co-author.
Several factors help explain why improving targeted public policies would reduce the racial wealth gap and lessen the increased reliance on debt. One factor is that over the period studied there was an increasing dependence on credit markets to make ends meet. Among those with no financial assets, credit is often an emergency resource to help cover a job loss or medical emergency.

A second factor is that deregulation of the lending market brought a proliferation of high-cost credit, including securitized subprime and predatory loans, payday lending and check-cashing stores. Consumers of color were targeted in this market and resorted more frequently to credit cards and other forms of high-cost debt in the absence of assets or extended family resources to draw upon.

“The data make a critical contribution to the debate today about how to ensure greater economic security and opportunity for all our citizens. A racial wealth gap affects all of us because it means that a large portion of the population cannot contribute to building the wealth and strength of our nation, and that is a drain on us all,” said Meizhu Lui, director of the Insight Center for Community Economic Development’s “Closing the Racial Wealth Gap Initiative.”

Source: Science Daily (May 17, 2010)

Afro-Latino Caribbean culture insists on tasty flavorful food.  One dish required at any meal is the beloved plantain. The plantain’s lure is its ability to be served both as a vegetable and a fruit which is why it reigns supreme in every Latino diet.  From the savory tostones rellenos (stuffed plantains) to pastelon (Caribbean lasagna) or sancocho (stews); the plantain is as versatile as the potato. The plantain is the Caribbean potato!

In either of its forms, the plantain was time consuming and cumbersome to prepare, until now that is…  John Rivera invented Rivera’s Tostonera to revolutionize Latin kitchens; giving cooks the power to make tostones (fried plantains) chips, cups, and slices, with the added convenience of making more than one at a time.

Rivera’s Tostonera is a patented plantain press, invented by John Rivera.  John spent the summers of his childhood in Piñones Puerto Rico, where his family owned a food kiosk on the beach. Growing up he pressed thousand of plantain chips. They had to make the tostones in a fairly primitive manner, mashing them with a can, a brown paper bag or between two pieces of wood one at a time. Today tostones are still being pressed the same way.

So John went to work. “I wanted to create a modern day plantain press that could do more than one chip or cup at a time but could also press slices”.  It took John 52 prototypes, a two year apprenticeship with a Caribbean Executive Chef, and at least 500,000 plantains to get to “Rivera’s Tostonera.” So now John Rivera proudly presents Rivera’s Tostonera, (Patent No. 7,442,025 B2) It shapes plantains into Chips, cups, and slices quickly and efficiently, no muss no fuss and it makes more than one at a time.

After receiving his patent John wrote and photographed a cook book in honor of the plantain. “The Pleasures of Plantains: Plantain Cuisine”. To learn more about John and his inventions check out: RiverasTostonera.com.

Click here to read our spotlight feature on John Rivera.

Money Matters:  It’s Time To Fight Back

By Gary A. Johnson

I don’t know about you, but I’ve had enough of the banks and credit card companies taking advantage of hardworking consumers and people who consistently pay their bills on time.  Not all of the people struggling to pay their bills and meet their financial obligations used to have good credit, but have fallen prey to the revolving credit card industry and/or hard times.

The current downturn in the economy has made life “tough” for millions of Americans.  “Tough” is a relative term, in that “tough” for some people is cutting back on their Latté’s and the housekeeper.  “Tough” for others means they have no savings and are about to lose their home.

I own and operate a small business.  I’ve tried to grow my business and like millions of others businesses, the economic downturn has negatively impacted my company.  In fact, the terrorist attack on our country that occurred on September 11, 2001 was the beginning of the loss of revenue for the company.

As a result of trying to hold on to the business I used my sterling credit rating in the form of credit lines to fund and eventually restructure the business.  I’ve had a 30-year relationship with the American Express company.  As a result I was able to secure a business line of credit via both gold and platinum corporate cards.  I selected American Express because they offered services that were supportive of small businesses.

Imagine my surprise when I received a letter from American Express informing me “that after a thorough review” of my credit profile they have placed a spending limit on my account.  My first reaction was OK, times are difficult and many banks and companies are tightening their credit and lending practices.  As I continued to read the letter, I was informed that my credit had been drastically reduced.  I went from a six-figure credit line to a low four-figure limit. In fact, the limit is so low that I cannot run my business with the new limit.

Let me put my situation in perspective.  My company has no history of late payments or outstanding balances. In fact, my last month’s statement had a surplus balance.  American Express showed their appreciation by crippling my ability to run my business.  Their actions clearly indicate that they no longer wanted to be a business partner with my company. Thank you American Express.  When it’s all said and done, I think I will reflect on this situation and realize that this was a turning point in my company’s financial independence.

I would not dare compare what’s happening to American consumers to “mafia-like” tactics.  That would be an insult to the mob.  However, I can’t help but wonder if consumers would be better off if their accounts were managed by organized crime.  Many of these banks, were forced to take tax pay dollars.  Some of the banks needed the money to survive and others did not.  American consumers were misled.  Through a series of press releases and announcements, consumers were led to believe that some of the financial institutions who took the money were going to help consumers with their debt.  Many of these banks took our tax dollars and wiped the books clean of their debt and mismanagement and proceeded to make more money by screwing consumers with tricky fees and raising interest rates without warning or on a seemingly ad-hoc basis putting their customers deeper in debt.

The Obama administration says they recognize that what’s happening to consumers is not fair.  They tout the Credit Card Accountability Responsibility and Disclosure Act that outlaws several of these credit card policies that have sparked consumer outrage including retroactive rate increases on existing balances for cardholders who are in good standing.  Other deceitful tricks, albeit legal, include hiking rates for new charges without at least 45 days’ notice; “double-cycle billing,” which allows fees to be charged for balances that were already paid off; and “universal default,” which applies rate hikes if a customer is late with payments on unrelated bills.

Sounds good doesn’t it?  I wouldn’t pop any champagne just yet.

The new law amends the Truth in Lending Act, which only governs consumer loans.  It does not apply to corporate cards.  Say what?

What this means is limited liability corporations and other companies that use traditional corporate cards, the same old rules will continue to apply.  Let me translate this in a more vernacular kind of way:  Some of the credit card companies will continue to have the legal authority to insert a golf umbrella in your rectum.  Other companies will try and open the umbrella.

It is time to fight back.  I’ve decided to use all of my business adversity to motivate me to do better.  To work harder, be smarter and do what I can to help others who have it worse than me.

I can’t quit.  I have faith that I will not be down for long and I will emerge from this downturn stronger than ever.

American Express’ decision to reduce my spending limit has crippled by ability to conduct business.  I was upset.  I only allowed myself to stay upset for about 30 minutes.  My net move was to fight back.  I decided to fight back strategically by terminating my relationship with the company.  Consumer advocates tell you NOT to close your accounts immediately because this action can impact your credit score in a negative way.  I have enough credit lines and alternatives.  I’m willing to take that risk.

I called American Express and when the Customer Service Representative (CSR) came on the line she announced her name and asked some identifying information to confirm that I was the cardholder.  Her next question was:  “How can I help you today?”  Before I could answer, the CSR replied, “Oh, I think I know why you’re calling.  You received a letter about your spending limit.”

I wanted to make sure that my call was being recorded for accuracy.  Once confirmed I calmly asked the rep if my account was in good standing.  She acknowledged that it was.  I then asked if I had a history of late payments or outstanding balances.  She she acknowledged that this was not the case.  I asked why my spending limit had been reduced.  She explained that my credit report reflected high balances on some other accounts.  She then suggested that I get a copy of my credit report and work to reduce my card balances with the other lending institutions.  The rep also was sure to let me know that American Express would re-evaluate my situation at a later date.

I explained to her that I was aware of the contents of my credit report and that I have no history of late or delinquent payments.  I am in good standing with all of my creditors.  I advised the representative that American Express has their method for dealing with customers and I have mine.  My method involved dealing with companies based on how they dealt with me.  As a result, I don’t like how I’ve been treated and advised her that I wanted to close my account.  The credit card companies don’t want to lose your business, but every action has a consequence.  I’ve decided that it was time for me to part ways with American Express Corporate Gold Business card.  During my company’s heyday, I would generate $5000 to $10,000 dollars a month in charges.  The company would get their money within 30-days.  Those days are over.  By their actions American Express has told me that they no longer want to be a partner as they have been in past years.  I’m sure they want more of my money, however, when business gets better, I will give my business to a company that demonstrates that they want to work with me during both good and bad times.

I am in the process of getting a pay off balance, cancelling my account and moving forward to reduce my debt to credit ratio to become less dependent upon the banks and credit card companies.

I really feel good about this action.  This was my way of staying empowered.  If more people took small steps like this, we would send a message to the predatory bank and lending institutions.

I am not an economist, but I believe this country would have been far better off if every citizen’s debt was reduced by 50%.  We would not need a Stimulus package, recovery money and all of the other programs, many of which will result in waste and fraud, again costing the taxpayer more money.

The president of the American Bankers Association says the legislation “changes the entire business model of credit cards.  “Edward Yingling says it restricts the ability to price credit for risk — in other words, to charge more for those more likely not to repay their debts.

Lots of people pay off their credit cards in full each month to avoid finance charges.  This is not good enough for some credit card companies.  Some industry experts say credit card providers might start charging new fees for their cardholders and could raise their interest rates.

Don’t get mad people, get strategic.  Consumers need to find a way to fight back against the credit card companies and lending institutions in a manner that will allow them to stay empowered and be whole.  This philosophy has worked for me.  This is how I maintain my sanity.  Folks, I’m one of the most blessed people on earth.  I have a loving family which serves as my support structure.  How do the folks who don’t have a support structure surviving?

I would suggest that everyone in need assess your skills and abilities and look for opportunities to prosper, even during these terrible economic times.  Times aren’t bad for everyone.  Many people and business have not been affected by the economy and others are thriving.  Come on people!  Let’s get started!

The Isley Brothers had a song out years ago called “Fight The Power.”  Fight it!  Fight the power!

Gary Johnson is the Founder & Publisher of Black Men In America.com a popular online magazine on the Internet and the Black Men In America.com Blog. Gary is also the author of the new book “25 Things That Really Matter In Life.”

By Gary A. Johnson

8 Ways to Save on Auto Insurance

Taken from the popular book, 425 Ways to Stretch Your $$$$, by Vernon Williams www.howtocutexpenses.com

1. Raise your deductible.

A Deductible represents the amount of money you pay before the insurance company pays a claim. By requesting higher deductibles on collision and comprehensive (fire and theft) coverage, you can lower your costs substantially. For example, increasing your deductible from $200 to $500 could reduce your collision cost by as much as 30%. Since the national average annual premium is $687, this can save you $206 per year.

2. Drop collision and/or comprehensive coverage on older cars.

If your car is totaled in an accident, you receive the cash value of the car. Although insurance companies use their own criteria to make this determination, you can get a ballpark estimate from www.kellybluebook.com. If your car is 5 years old or older, it may make sense to cancel the collision and/or comprehensive and bank the savings.

3. Avoid duplicate medical coverage.

If you have adequate health insurance, you may be paying for duplicate medical coverage in your auto policy. In some states, eliminating personal injury protection (PIP) can lower your premium by up to 40%.

4. Drive a “Low-Profile” car.

Before you buy a car, check into the insurance costs. Cars that are expensive to repair, or are favorite targets for thieves have much higher insurance costs. Go to www.hwysafety.org and click on “Injury, Collision and Theft Loss” to see how your car is ranked.

5. Drive less.

Some companies offer discounts to motorists who drive less than a predetermined number of miles a year. Consider using public transportation, a carpool or vanpool to commute to work.

6. Ask for a multi-policy discount.

Some companies give a discount if you have more than one policy with them.

7. Ask for a discount based on your credit score.

Some companies use the credit score to establish premiums. If you have a high credit score, ask for a discount.

8. Comparison shop.

Prices for the same coverage can vary by hundreds of dollars, so it pays to shop around.

Go to www.howtocutexpenses.com.

Click “auto insurance.” Click “get quotes.”

Bankruptcy is Not Always the Best Solution

By Harrine Freeman

One of the biggest myths is that if you file for bankruptcy you will be financially free and no longer have debt problems. Wrong! Bankruptcy is not the cure-all for getting out of debt. Over a million Americans file for bankruptcy every year. One in every 73 households files for bankruptcy. In 2007, approximately 1 million Americans filed for personal bankruptcies. Millions of Americans are in debt and get in debt every year. Many people think that filing for bankruptcy will solve all of their debt problems. On the surface it seems that if you file for bankruptcy all of your debt will be eliminated and you can start with a clean slate. Actually it is not that simple.

To file for personal bankruptcy you must reside in a state for 90 days prior to filing and have a total unsecured debt less than $290,525 or secured debt less than $871,550. The new bankruptcy law that went into effect in October 2005 states that debtors (consumers) who earn less than the median income in their state about 80 percent of those who file for bankruptcy still would be entitled to file under Chapter 7. But those who earn more than that and who have the ability to repay at least $6,000 over five years would have to file under Chapter 13, which requires a repayment plan.

Although it is true that after you file for bankruptcy you can purchase a house or a car, what people don’t realize it that the interest rate that you will be given will be very high. Also, based on the new bankruptcy law implemented in October 2005, it is harder to file for bankruptcy and depending on the type of bankruptcy granted it will remain on your credit report for seven to ten years. This greatly lowers your credit score and it will probably take about 3 to 5 years before you score increases due to the bankruptcy filed and provided that you don’t get into any further debt.

When you have financial problems and can’t see any way out bankruptcy looks like the best option but there are many other options available to you. If you have a house you can take out an equity loan to pay your debts, you can reduce your expenses and create a budget for yourself, you can get a part-time job, go to school and further your education and get additional training related to your particular job, setup payment plans with your creditors or sell some of your assets if you have any.

The best consumer is an educated consumer. If you find yourself in financial troubles the first and best thing to do is do research and find out the options available to you. Next you want to identify your assets and liabilities. Your assets are anything that you do not owe money on such as stocks, bonds, 401(k), retirement plans, etc. Your liabilities are anything you owe money on such a house, investment property, boat, car, etc. This will help to determine if you have any assets that can be sold or money borrowed against to pay off your debts. Next you need to create a budget for yourself to identify how much money you have coming in (how much you get paid each week) and how much money you have going out (how much you pay each month in bills and expenses).

If you have very little or no assets then you will need to do some quick fixes such as cutting back on expenses such as: bringing your lunch to work, carpooling, catching the subway or bus to work, riding your bike or motorcycle to work, eating breakfast at home, renting videos instead of going to the movies or cutting back on how often you go to the movies, canceling your pager or cell phone service or switching to the cheapest plan available.

These things will provide extra money in a short period of time until you develop a plan for paying off your bills. If you have researched all options that are available to you and are unable to use any of them then bankruptcy should be your last resort, not your first option.

Getting in debt is the worst place to be but with time you can overcome this obstacle. Think long and hard before filing for bankruptcy. It may not be worth the headache.

Harrine Freeman is the CEO of H.E. Freeman Enterprises, a credit repair and personal finance services company. She is a member of the American Association of Daily Money Managers, SPAWN, Toastmasters, NAWW and the Women Network.

For more information on how to get out of debt or to buy her book please visit http://www.hefreemanenterprises.com/. She can be reached via e-mail at hfreeman@hefreemanenterprises.com.

Who is Derek Ward?…

And what is his plan to make an impact in the world as we know it?

Derek Ward is a mortgage broker with a far reaching background in the realm of financial counseling and education. He has been in the world of finance for more than two decades and is now dubbed “The Financial Educator.” A title that he says he “doesn’t take lightly”. Ward is also a former co-founder of First Federal Mortgage in Palmdale, California. He is currently promoting a state of the art product that will allow many people to not only stay in the mortgage game without losing their shirt or home, but actually get ahead with increased equity and a paid mortgage much earlier than your loan documents state.

With the economic “crunch” (don’t call it a crisis…or even a recession) that America is facing, many people are trying to find a way out of debt, mortgages and credit obligations. A record high in nationwide foreclosures is putting a damper on the American dream. A change in the stock market is leaving many people concerned about the future of retirement based investments. And, the increase in the cost of living coupled with the decrease in the value of the American dollar is leaving many people in a quandary as to what their next step should be.

In steps Derek Ward…

“The Financial Educator” has been offering advice for many years…advice that has been so succinct and on point that he, jokingly, often finds that he “talks himself out of business by telling his clients what all of their options are and allowing them to make the decision for themselves”. Despite his strong financial background, he has found a solid stepping stone in the mortgage world. In light of the spike in home foreclosures, he has focused his efforts on bringing relief to consumers finding pain in the housing market.

With a system that is fairly new in the United States but very popular abroad, Ward is vowing to help clients pay off their mortgage in record time. “We are in the process of trying to bring this system to the United States and I am a man on a mission; my goal is to change the financial landscape of America one family at a time by showing people how to own their home free and clear and eliminate all of their debt and have financial freedom.”

This is how it works…

“Traditionally homeowners deposit their income into a checking account and pay their monthly expenses as they’re due, using that account. And, any money that’s left over at the end of the month is either left in their checking account or transferred into their savings account.”

“Well with my system, homeowners are actually able to cancel out interest on their mortgage with the money that they would normally leave sitting in their checking account or their savings account. It consists of three components:

1. Your mortgage: We can show homeowners how to take their thirty year mortgage and pay it off in a fraction of the time…many cutting their mortgage repayment by 1/3 to 1/2 of the normal time.

o They do not have to refinance

o There’s no increase to the current monthly payments

o It’s not a bi-weekly program

o There’s no lifestyle changes to the consumer

Derek Ward breaks down mortgages and the way this all works together. “A current mortgage is a ‘closed-in’ mortgage and what that means is that the consumer has a monthly scheduled payment and they [the consumer] send it to the bank and the bank applies a very small portion to the principal and the bank then takes the huge chunk and apply it towards your interest. By doing that, you’re actually paying almost double the finance charges in a thirty year period on a typical mortgage, for example a 200k mortgage will cost you about 431k total so you are actually paying about 231k in finance charges on a 200k mortgage. That is a lot of interest. In the United States, we are a payment driven society. In the United States we normally look at two things; ‘what’s my monthly payment’ and ‘when is it due’. They never tend to take a look and see what the finance charges are that their being charged on that loan. This goes for credit cards. This goes for car payments. This goes for any type consumer debt.”

2. A line of credit: You can use any line of credit. You can use a personal line of credit. You can use a business line of credit, or if you have equity in your home, you can use an equity line of credit.

o The line of credit, typically depends on your mortgage balance. Your line of credit can usually be anywhere between 8k and 80k.

3. The software: The software works as a financial dashboard to enable the homeowners to effectively manage the entire process.

o We offer lifetime service support to the homeowners in addition to coaching services that enable them to benefit from the full potential of the program.

o The software instructs homeowners to transfer specific amounts at specific intervals from their line of credit to be paid directly to the principal on their primary mortgage.

After discovering the 3 basic pillars of the program, Ward continues to explain the full breakdown of this process and how it works to save you time and money. “This creates considerable interest savings over a homeowner’s primary mortgage. After the homeowners transfer specific amounts of money, they will then deposit their income back into the line of credit instead of depositing it into their checking account. So what it’s coaching us to do is change our banking habits and paying the bills directly out of the line of credit, and you start depositing your line of income back into the line of credit.”

“The nice thing about this is that when you go to pay your bills each month, you don’t have to wait until you get paid because you are using OPM which is Other People’s Money. You are going to advance the amount of your expenses directly from your line of credit. Now when you advance that money from your line of credit, the bank typically calls for a minimum payment that’s required because you borrowed the money. By taking your income, paycheck, payroll or commission or whatever you have and applying it back to the line of credit, that does two things. The first thing that it does is cancels out the interest on that line of credit because you have applied money back to it. The second thing that it does is actually satisfies the banks requirement of the monthly payment. Homeowners are still able to use their line of credit services such as checks, debit card, ATM card…they still have access to their money.”

Through typical banking we deposit our money into a checking account to make monthly payments; leaving our money to remain dormant and stagnant for us. Additionally the bank is loaning that dormant money out and making money on it through interest payment from other consumers and you still make nothing from it. This type of program cancels that out and allows your money to work harder for you. Ward explains the remaining portion of the program and how it comes into play beyond the standard three steps.

“Once the software determines that the homeowner has reached an optimal balance on their line of credit, the software instructs them to initiate specific funds transfers towards the primary mortgage to reduce the balance on the mortgage.”

In our society, this all seems too good to be true, yet Ward explains his own personal doubts he had with the system in the beginning and how it has proven to be what was promised and more. “When I first heard about this, someone came to me and said ‘Derek, I can show you how to pay your 30 year mortgage off in 8 to 11 years.’ and I said ‘How is that done?’, and they said ‘Let me run an analysis on your house.’ Well, it came back the next day and it showed that I would actually pay my house off in 11.8 years and I would save over 700k in finance charges. And I said ‘this is too good to be true.’ So I started to do my own research on this company and found that this company is licensed with the National Better Business Bureau. They have an AA rating with the Better Business Bureau and they’ve also been approached on many occasion to purchase the rights to the software and the last offer was over 60 million dollars and they declined it. IT appears that this will be the next paradigm shift for homeowners. It is predicted that anywhere between 40 and 60 % of homeowners will be on this type of program or something similar to it in the next five to seven years. So my mission is to get this out to the homeowners and let them know that you can own your house free and clear.”

“One of the additional services that we offer to the client is that once determine how you can pay off your home early, then we put together a financial strategy in terms of your retirement investments. We all know that social security is not going to be there. We so many people going back into the workforce and usually you see them at the front door of Wal-Mart greeting you. That’s simply because they didn’t plan for retirement and they were not given the choices. It’s not that they planned to fail, they just failed to plan.”

With a 100% success rate, 97% rate of client retention rate and a conservative projection from the software, many people are finding that the program causes a shift in their spending habits; a change in habits that actually results in a major adjustment to initial projections for the better. Whether you are planning to stay in your current home or sell it, the program has proven to be beneficial due to the increase in equity and earlier pay off date. To learn more about the program and obtain the software go to Derek Ward’s personal website: http://www.thefinancialeducator.blogspot.com/. Then click on “Pay Your mortgage off in 8-10 years.” This will direct you to a website and you will click on “Free Analysis” to see if the program is right for you.

• Additionally, Derek Ward is looking for more agents to promote the program and may be contacted for employment opportunities through his personal e-mail address at DWARDENTP@Yahoo.com.

Derek Ward is also a contributing columnist with Center Stage Magazine and his advice may be viewed online at http://www.centerstagemag.com/.

Why You Need To Save by Harrine Freeman

Many Americans today don’t have a savings account or emergency fund. I heard on the news on recently that the Commerce Department reported that Americans spend all the money they have and personal savings rates reached the lowest level since the Great Depression.

Start you creating an emergency fund. Your emergency fund is your safety net, in case you get sick or lose your job you can use your emergency savings to hold you for a few months until you can find a new job.

Your emergency account should be separate from your checking or savings accounts and should only be used for emergencies such as an unexpected expense, unemployment, medical bills, etc.

An emergency fund should be enough savings to pay your bills for at least 3 to 6 months. Money for an emergency fund should be readily accessible and stored in a checking or savings account, preferably a high interest savings account such as Emigrant Direct or ING or a money market account where you can make money while saving money.

To determine how much money is needed to pay 3 to 6 months worth of your bills do an inventory and write down all your bills and expenses and the monthly amount spent for each. Calculate the total. Use this amount and multiple by 3 or 6 to determine the total amount you need to save in your emergency fund.

Make sure you do some comparison shopping before opening an account for your emergency fund to ensure that they are no minimum or other fees for accessing your account. A good source to use is http://www.bankrate.com/.

You can start off by contributing small amounts to your emergency fund until you are able to contribute more. Start off with a contribution of at least $20 a month to your emergency fund. Once you are able to contribute more to the fund do so. Make several short-term goals for your emergency fund. Once you have saved enough money to pay one bill pat yourself on the back. Then keep saving until you have enough to pay three bills and so on until you have enough saved to pay your bills and expenses for 3 to 6 months.

Once you have reached your emergency fund goal it is time to start developing some long-term goals such as an additional savings account and to start planning for retirement. A great site to learn about retirement planning is http://www.morningstar.com/ and look under the Personal Finance section.

Having an emergency fund will ensure that you are on the road to becoming financially secure and will prevent you from going into debt when an unexpected tragedy happens or unexpected expenses arises. An emergency fund is the first step to getting out of and staying out of debt.

There are many organizations that provide emergency services for people such as the American Red Cross Emergency Assistance, Salvation Army Emergency Assistance Program and the United Way. The utility companies provide funds for people in need. You can use these funds to pay necessities and use money from your part-time job to pay other bills.

According to MSNBC.com, the savings rate of Americans declined to -5% in 2005, -1% in 2006 but has not risen to .6 in the second quarter of 2007. Consumers are spending over half of what they earn. The other 40% is spent on health insurance.

We no longer live in a society that promotes longevity and encourages stability. You must prepare for the future and a critical component of that is having a savings account. You may not know what the future holds but if you prepare your finances now, it will ease the burden of what tomorrow holds.

Harrine Freeman is the CEO of H.E. Freeman Enterprises, a credit repair and personal finance services company. She is a member of the American Association of Daily Money Managers, SPAWN, Toastmasters, NAWW and the Women Network.

For more information on how to get out of debt or to buy her book please visit http://www.hefreemanenterprises.com/. She can be reached via e-mail at hfreeman@hefreemanenterprises.com.

5 Ways to Become Financially EmpoweredWealth is defined as the value of everything you own minus any debts. A wealthy person is described as someone who can live comfortably for a least 5 years without working. Not everyone during his or her lifetime may become wealthy but you can become financially empowered. Financially empowered is being in control of your finances, spending your money responsibly, buy needs more often than buying wants, and setting goals for your future.Here are 5 ways to become financially empowered:1. Become a homeowner. Becoming a homeowner increases your credit score, proves that your are a responsible spender, provides a tax write-off, increases your financial worth, provides you with an asset that will appreciate over time which will provide you with equity.2. Buy insurance. Buy health, life and disability insurance. Many people get in debt from medical costs because they do not have life insurance. Life insurance is critical because medical costs increase by 10 to 20% each year. Disability insurance (short-term and long-term) will help you in the event you become seriously ill and have to be off work for an extended period of time. This will help you to recover because you will not have to worry about how your bills will be paid during this time.3. Start a business. Find out what your passion is, what you love to do more than anything else. You will not become financially empowered by working for someone else unless you were one of the lucky people who bought tons of stock while working at Target, Wal-Mart of AOL. Do your research before starting your business and take baby steps. Start your business in your home; there are many tax write-offs for home based businesses. Once you generate enough income then get a loan to open your own office. Get the book Rich Dad, Poor Dad by Robert Kiyosaki.4. Purchase investment property. All of the financial experts, millionaires and billionaires have talked about it. They all have the same thing in common. They all own investment property. If you are not sure how to begin, do your research, buy two or books on buying investment property, join a real estate group, listen to financial investment shows and find out the best way to get started. Investment property generates cash flow that can be used to generate wealth and allows more opportunities to become available to you.5. Plan for your retirement. Many Americans today have to work past retirement age because they have no savings or retirement. When a person looks at their life to see what they have accomplished, it is sad to say that they have nothing to show for it. Many still owe money on their homes, don’t have any savings and have little or no money in a retirement account. You worked all of your life for what, to pay bills. That is not how life is supposed to be. You should work hard, enjoy life, retire, and then really enjoy life.

She is a personal finance expert and the author of, “How to Get Out of Debt: Get an “A” Credit Rating for Free Using the System I’ve Used Successfully with Thousands of Clients.

Harrine Freeman is the CEO of H.E. Freeman Enterprises, a credit repair and personal finance services company. She is a member of the American Association of Daily Money Managers, SPAWN, Toastmasters, NAWW and the Women Network.

For more information on how to get out of debt or to buy her book please visit http://www.hefreemanenterprises.com/. She can be reached via email at hfreeman@hefreemanenterprises.com

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WHAT SHOULD I DO WITH MY MONEY?

GOD vs. THE GOVERNMENT

While many understand what it means to be rich, few have grasped the concept of true wealth. Scripture points to several examples of the difference between being wealthy and being rich. In all examples, being rich was a temporal experience while those who experienced wealth were under a different anointing. Some may ask the question; can I be wealthy and serve God? The answer is yes, yes and yes, not only can you serve God and be wealthy it is expected that with your wealth your ability to serve is expected. God wants you to be a blessing, He enables you daily for that purpose, the more you endeavor to place yourself in the position of being a blessing the more the Lord will put you in the position to be a blessing in a major way. Through scripture you will see that God wants us to be wealthy, in contrast the government needs us to work. The government needs us to be consumers. Unfortunately, poor money management and financial illiteracy have led to the great American nightmare of excessive debt, no savings, and limited access to alternative income. It has also led many people away from God’s promise.

Here is what the Bible has to say about wealth and financial responsibility.

(Entrepreneur)

2 Kings 4

1. A certain woman of the wives of the sons of the prophets cried out to Elisha, saying, “Your servant my husband is dead, and you know that your servant feared the Lord. And the creditor is coming to take my two sons to be his slaves.”

2. So Elisha said to her, “What shall I do for you? Tell me, what do you have in the house?” And she said, “Your maidservant has nothing in the house but a jar of oil.”

3. Then he said, “Go, borrow vessels from everywhere, from all your neighbors empty vessels; do not gather just a few.

4. “And when you have come in, you shall shut the door behind you and your sons; then pour it into all those vessels, and set aside the full ones.”

5. So she went from him and shut the door behind her and her sons, who brought the vessels to her; and she poured it out.

6. Now it came to pass, when the vessels were full, that she said to her son, “Bring me another vessel.” And he said to her, “There is not another vessel.” So the oil ceased.

7. Then she came and told the man of God. And he said, “Go, sell the oil and pay your debt; and you and your sons live on the rest.”

(Investor)

Matthew 25:14-29

14. “Again, the Kingdom of Heaven can be illustrated by the story of a man going into another country, who called together his servants and loaned them money to invest for him while he was gone.

15. “He gave $5,000 to one, $2,000 to another, and $1,000 to the last–dividing it in proportion to their abilities–and then left on his trip.

16. The man who received the $5,000 began immediately to buy and sell with it and soon earned another $5,000.

17. The man with $2,000 went right to work, too, and earned another $2,000.

18. “But the man who received the $1,000 dug a hole in the ground and hid the money for safekeeping.

19. “After a long time their master returned from his trip and called them to him to account for his money.

20. The man to whom he had entrusted the $5,000 brought him $10,000.

21. “His master praised him for good work. `You have been faithful in handling this small amount,’ he told him, `so now I will give you many more responsibilities. Begin the joyous tasks I have assigned to you.’

22. “Next came the man who had received the $2,000, with the report, `Sir, you gave me $2,000 to use, and I have doubled it.’

23. “`Good work,’ his master said. `You are a good and faithful servant. You have been faithful over this small amount, so now I will give you much more.’

24. “Then the man with the $1,000 came and said, `Sir, I knew you were a hard man, and I was afraid you would rob me of what I earned, so I hid your money in the earth and here it is!’

26. “But his master replied, `Wicked man! Lazy slave! Since you knew I would demand your profit,

27. you should at least have put my money into the bank so I could have some interest.

28. Take the money from this man and give it to the man with the $10,000.

29. For the man who uses well what he is given shall be given more, and he shall have abundance. But from the man who is unfaithful, even what little responsibility he has shall be taken from him.

(Real Estate)

1 Kings 21

1. Naboth, a man from Jezreel, had a vineyard on the outskirts of the city near King Ahab’s palace.

2. One day the king talked to him about selling him this land.“I want it for a garden,” the king explained, “because it’s so convenient to the palace.” He offered cash or, if Naboth preferred, a piece of better land in trade.

3. But Naboth replied, “Not on your life! That land has been in my family for generations.”

Here is what the government says. My illustrations are drawn from information on federal employees, one because I am one and also because generally government employees have certain benefits not offered in the private sector. It was once thought that if you had a government job, you were set for life, with a good retirement to follow.

“….employees may be underestimating how much income they will need in retirement. More than a quarter either believe they need less than what financial planners generally recommend or could not estimate their retirement needs” Careful Retirement Investing, Stephen Barr, Washington Post, 29 January 2007, Page D01

WASHINGTON – People once again spent everything they made and then some last year, pushing the personal savings rate to the lowest level since the Great Depression more than seven decades ago. The Commerce Department reported Thursday that the savings rate for all of 2006 was a negative 1 percent, meaning that not only did people spend all the money they earned but they also dipped into savings or increased borrowing to finance purchases. The 2006 figure was lower than a negative 0.4 percent in 2005 and was the poorest showing since a negative 1.5 percent savings rate in 1933 during the Great Depression. “2006 Personal Savings Drop to 74-Yr. Low”, By MARTIN CRUTSINGER, AP Economics Writer

“….Although the government continues to offer guaranteed pension benefits, it, like many companies, is requiring employees to take more responsibility for their retirement planning. People hired by the government after 1983 are covered by the Federal Employees Retirement System, and FERS-covered employees outnumber those in the older Civil Service Retirement System 2 to 1. “Employees must now begin making decisions about their retirement goals as soon as they start their federal careers,” the OPM paper said. Under FERS, retirement income will come from three primary streams: a modest pension, Social Security and investments in the Thrift Savings Plan, a 401(k)-type program. “A significant and for many employees the largest-portion of their retirement benefit will come from the TSP,” OPM to Prod Federal Employees to Get Cracking on Retirement Planning, Stephen Barr, Washington Post, 21 November 2005, Page B02

“While the TSP is important, financial advisors stress that it should only be a complimentary source of income for retirees. …. employees should still be relying on their defined annuity, Social Security and other savings for the basics, and if that’s not enough, “then we have to wonder if they’re expecting too high of a standard of living in retirement.” Life After Government: TSP Tips, Karen Rutzick, GovExec.com, 22 September 2005.

How can we live a prosperous life according to God’s word? The Bible gives us some great examples of the three ways to generate wealth: Land (Real Estate), Investments (stock market), Entrepreneur (Business Ownership). This is where the government can actually help. Our system of government favors business owners and investors; the ten percent of the population that controls ninety percent of the wealth. There are 137 tax deductions for business owners.

Financial education is vitally important but sorely lacking in this country. Everyone should first understand why they need to be wealthy. The next step is to accept the responsibility of wealth. Third, don’t try to do it alone. Build a financial team. Great wealth awaits those who grasp opportunity.

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