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Guide to Trade Futures During Higher Volatility

Guide to Trade Futures During Higher Volatility

The increased volatility in the markets means retail futures traders should take smaller positions and remain disciplined in their strategies.

September 16 has seen a large amount of liquidity in the markets since it is triple witching day when equity options, equity futures and index options and futures contracts all expire.

Futures traders must not deviate from their original strategies even as volatility picks up, said Peter Borish, chief strategist with Quad Group, a New York-based financial firm.

“One is in the trading business to make money and are not in the business to be right,” he said. “The most important thing is to maintain your discipline.”

Making smaller trades is important, because the market does not “go straight up or straight down, particularly when volatility expands,” Borish said.

When traders have an opportunity to take a profit, they need to take advantage of the opportunity. Otherwise, “what happens to many people is you end up turning a profit or small loss into a large one,” he said.

One major mistake retail traders commit is attempting to pick the top and wanting to be right, Borish said.

“It happens to many people and under no circumstance should you use volatility as an excuse to lose your discipline,” he said. “Too many people get greedy and they stay in a position too long and don’t take profits or continue to stay short. If they sell a position and it starts to go back up, they still stay in the short.”

Traders need to stick to their original trading plans and understand their own goals and risk tolerance, said J.B. Mackenzie, director of futures and forex of TD Ameritrade, an Omaha, Neb.-based online broker. When there is increased volatility, defining your risk upfront will help.

“This is a 24-hour market and news outside the U.S. could affect your positions, especially assets such as crude oil (CL) ” he said. “Use a stop/loss on your trades because it helps control your risk.”

Since today is witching day, volatility will increase more than usual and some investors will be looking to get out of positions, Mackenzie said.

Trading in smaller positions can minimize losses and lower your risk. Instead of buying three lots in a single order, an investor could purchase one or two lots and watch how the market reacts.

“You’re hitting a single, don’t try to swing for the fence and hit a home run,” he said. “Figure out your average price point and define your downside risk,” he said. “If your goal is $44 and it is trading at $43, place an order right above or below it, but don’t jump in all at once and build out your trade.”

A pullback in the market might occur next week before the Federal Reserve meets, which will lower the amount of volatility, Mackenzie said.

The Chicago Mercantile Exchange’s FedWatch tool shows there is a 12% probability that the Fed will raise interest rates, a decline from 15% on Sept. 14. The odds are based on their 30-Day Fed fund futures prices.

Smooth or Reduce Volatility Over Calendar Time

Futures traders can lower their volatility by investing bit by bit over time which is akin to dollar cost averaging in a 401(k) or IRA, said K.C. Ma, a CFA and director of the Roland George investments program at Stetson University in Deland, Fla. This strategy is more effective in this market because of “maturity effect.”

“Futures volatility tends to increase when approaching maturity, so a natural way to reduce the portfolio volatility is to spread your investment over time,” he said.

Traders can also spread their investments across the same contract of different maturity months at the same time which also lowers volatility and risk.

“A futures contract with longer maturity, by design, has lower volatility than a nearby contract,” he said. “The result is the same in reducing overall volatility, without losing the investment theses of the directional calls of the underlying assets.”

Markets Are Range Bound

When markets begin to move widely, but remain in a range, traders can use daily and longer term charts to determine price action, said Anne-Marie Baiynd, a Detroit-based trader and author.

“When markets become indeterminate or non-trending as they are now, the trading strategies and length of hold time must be adjusted,” she said.

The futures market remains range bound “with sufficient buying pressure showing support levels to recover quickly, but also enough sellers present to prevent an upside breakaway of formation,” Baiynd said.

The market remains in a state with traders waiting “eagerly” for either a breakout or a breakdown to hold, she said.

Baiynd reminds her traders to “identify regions of support and resistance visible on weekly charts and assess the prevailing momentum,” she said. “If momentum is not sloping, the charts will bounce off the floors of support and reject the ceilings of resistance.”

Inexperienced traders often fail to realize that technical trading mechanics need to adjust to the underlying conditions of the charts. Failing to understand can lead the investor to utilize the wrong strategies in the wrong environments.

“As I review my charts each day, this is often one of my primary considerations – have buyers and sellers established a true hierarchy of control,” Baiynd said. “That would mean that if buyers were in control, I would see and upward trend and if sellers were in control, I would see a downward trend.”

Traders should watch the flow of motion, the size of orders at these levels and estimate whether charts are “buying to cover or close their positions (at support), or selling to cover or close their positions (at resistance),” she said.

Tips Marriage Can Fix Your Terrible Credit

Tips Marriage Can Fix Your Terrible Credit

Joint credit isn’t something married couples have to dive into automatically. It should be considered as seriously as your marriage itself.

It doesn’t matter if you’re a platinum card holder with a credit score in the 800s or an infrequent bill payer who can’t buy a car without a co-signer. Your previous credit history doesn’t make one bit of difference to your partner’s credit… until you apply for credit jointly.

“Money and love don’t always mix,” says Anthony D. Criscuolo, certified financial planner with Palisades Hudson Financial Group in Fort Lauderdale, Fla. “When getting married, often one of the most difficult issues is the merging of a couple’s finances. This is especially true if one or both spouses have a lot of debt or past debt that was handled poorly.”

Since your credit reports are attached to your Social Security number, your partner doesn’t get them or your credit history. Even if you or your partner change your names, the Social Security numbers stay the same… only with an alias attached to your original name.

“Only debts and accounts that you open jointly will be tracked on both of your credit histories, and still they are tracked as part of your separate credit histories” Criscuolo says. “Joint accounts are just reported to the credit agencies under all of the Social Security Numbers that are on the account. There is no such thing as a ‘joint’ credit score.”

Engaged couples or newlyweds may be considering combining banking and credit accounts just to simplify matters, but that approach is only simple on its surface. Julie Pukas, head of U.S. cards and merchant solutions at TD Bank, notes that one member of a couple can authorize the other to use their credit card. The upside is that a cardholder with bad credit can have a spouse with good credit help them polish up their credit score and look better in the eyes of credit bureaus. However, there is a catch.

“If you have too little invested in Europe and the United Kingdom, it’s a great opportunity to invest more while prices are down,” he says.

He advises investing about 15% of your equity portfolio in Europe, with exposure to both the U.K. and the rest of Western Europe. That’s actually fairly low compared Europe’s share of the global economy, but it addresses concerns about the region’s long-term economic struggles and political gridlock.

Joe Correnti, senior vice president of brokerage product at Scottrade, notes that investors should also consider rebalancing their mix of assets around this time. If your portfolio consists of 60% equities and 40% bonds or other fixed income, plummeting stocks may have left you a little heavy on the bonds side.To keep that 60-40 balance, you can either immediately rebalance or see if your portfolio springs back quickly. However, that decision should be based on your timetable and risk tolerance.

“If you are investing for the long-haul, shedding international holdings probably doesn’t make much sense,” said Joe Correnti, senior vice president of brokerage product at Scottrade. “While the vote in the U.K. has led to some volatility in the market, in fact this appears to be the most significant two-day disruption the market has seen, we continue to believe the markets will bounce back, and recent events will likely be viewed as an opportunity.”

Just realize that, with a gross domestic product of about $2.9 trillion, the U.K. is still the fifth-largest economy in the world. While it’s unknown what those effects might be, they aren’t going to be “nothing.”

Jacobs at Palisades Hudson recommends investing in large-cap European stocks through low-cost index funds such as the Vanguard European Stock Index Fund. You can sell losing stocks if you feel that’s the right move, as you can deduct $3,000 worth of losses per year if you don’t have any offsetting gains, but prepare to say goodbye to them for a while. A “wash sale” buyback within 30 days will knock out that deduction, so buy another similar European ETF or mutual fund if you’re having buyer’s remorse.

Also, and this is the tough part, look on the bright side and don’t get jittery. There’s a strong chance that even if the U.K. goes through with leaving the European Union, it may work out well for all parties involved. The EU will work harder to keep its house in order and its membership intact, while the UK’s decision can’t hurt the U.S. all that badly. Exports to the U.K. were less than 4% of all U.S. exports last year, and the U.K. accounts for just 3% of S&P 500 companies’s revenue.

“There won’t be mass defections of talent or wealth from Britain. New trade agreements will be negotiated, and cooler heads will prevail,” Jacobs says. “It’s not in the remaining EU countries’ interest to punish the U.K.”

That said, the Brexit didn’t happen in a vacuum. DeVere’s Green cites China’s economic growth, the U.S. election, the failure of negative interest rates in Japan and the eurozone to stimulate sustainable recovery, and the Fed’s nervousness over the U.S. economy as other concerns for the remainder of 2016. While market shocks from Brexit won’t throw the U.S. or the world into recession, they shouldn’t be viewed as anomalies, either.

“Investors have always faced some volatility but shifting fundamentals will continue to drive up volatility further in the markets for the foreseeable future,” Green says. “Not only do investors need to accept this, they need to embrace it. Volatility is good for markets and investors alike, because it generates important investment opportunities.”

Tips to Invest When the World Is on Fire

Tips to Invest When the World Is on Fire

We understand that all you want to do during this year of elections, Brexit, terror attacks and other global upheaval is panic.

We won’t say don’t, but at least try not to.

 At few points in recent history has “world on fire” been as popular a search topic as it is now. The U.S. presidential is approaching, and this year we’ve dealt with a faltering Chinese economy, the United Nations stepping away from the European Union, Turkey in disarray, terrorist attacks throughout the globe, a virus-and-scandal-plagued Summer Olympics in Brazil and… oh yes, your finances. How, exactly, is an investor supposed to cope with a world that increasingly resembles a 24-hour news network’s “breaking news” ticker?

With resignation. Nigel Green, founder and chief executive of the U.K.-based deVere Group, notes that his home nation’s turmoil is only the beginning. He predicts that not only are we not going to be on stable ground for a while, but that investors may need to get used to that reality.

 “With the new finance minister, Philip Hammond, flagging a possible six-year renegotiation period, with ground breaking decisions being made by the U.K. and the EU, and with those decisions having a far-reaching global impact, investors need to accept that significant uncertainty, which leads to market volatility, is here to stay,” he says. “It is the new normal.”

His U.S. counterparts don’t really disagree. As soon as the Brexit vote cleared, Paul Jacobs, chief investment officer of Palisades Hudson Financial Group in Atlanta, noted that investors could take advantage of the situation by diversifying their portfolio.

Financial Planner Salary Tips

Financial Planner Salary Tips

unduhanThe career of a financial planner is considered to be a very lucrative one and attracts many youngsters these days. The salary range largely depends on educational qualification and other finance related talents.

Job Description
The trend of seeking advice for personal budgeting, managing expenses, and getting suggestions regarding big ticket investments has been on the rise for years. Hence, due to the increasing demand for sound investing and financial planning advice, the job market for professionals such as these is booming. They advise clients on their investments in real estate, bonds, stocks, etc., and have a thorough knowledge on the various instruments of investment. They also play a crucial role in activities such as corporate takeovers, mergers, and acquisitions, and can have individual as well as corporate clients.

To develop a career in this domain, you need to choose subjects such as mathematics, statistics, or economics in high school. Obtaining a bachelor’s and master’s degree in the field of finance, accounting, or management can help you launch a successful career as a financial planner. Further, you need to obtain related certifications by clearing exams of concerned authorities. Good communication skills, consistent efforts, hardworking nature, and a keen interest in the subject are the qualities which you need to acquire as you go along with your career.

Salary Range
The salary largely depends on the educational qualification, years of experience, location of job, and the skill set possessed by the candidate. Most positions related to this field are created in the top business hubs of New York, Texas, and California. Therefore, the salary is higher in such places. In the initial stages of their career, they can earn anything between $40,000 to $50,000 per year. In case of candidates graduating from top business schools, this figure can be much more. The salary can be in the broad range of $40,000 to $70,000 per year, after two to five years of experience. Those with eight to fifteen years of experience can earn anything between $70,000 to $130,000 per year. Financial analysts working at top positions in well-known corporations can earn in excess of $140,000 per year. Other than the salary, benefits such as bonuses, perks, and incentives are also received by the employees.

Professionals who are independent consultants may have to go through some difficulties in finding clients in the initial stages of their career. However, once they have an established clientele in the industry, they can earn much more than their counterparts who work for private organizations. They can also conduct lectures, seminars, and workshops on finance management and earn more.

The aforementioned content will help you plan a career in the field of finance. Financial planners are considered to be talented individuals with great aptitude. So, if you are planning to make a career in this field, be ready to work smart and be challenged every step of the way.

Tips for Families Seeking Help Paying for College

Tips for Families Seeking Help Paying for College

According to Sallie Mae, high school seniors are “all in” on continuing their education at a higher level. The education financial company says 83% of college students and parents “strongly agreed that higher education is an investment in the future, college is needed now more than ever (70%), and the path to earning more money (69%).”

Paying for college has also become something of a balancing act. Sallie Mae says students pay for 30% of college bills while their parents cover 37%, with scholarships, grants and direct college aid covering the rest.So college expenses are something parents and high school seniors should handle together.”Students and parents should weigh the cost and affordability of college as a family,” says Charlie Rocha, senior vice president at Sallie Mae. “There are a number of options available, and it’s important that they do their homework together in order to best realize their return on the educational investment.”Unfortunately, not many families take the ‘team’ approach. Sallie Mae says only 25% of families shared decision-making responsibilities on college financing, and only 15% collaborated on where the student will ultimately go to college.But not only should students and families act together, they should act soon. May 1 is only a few weeks away, and that’s the date most colleges and universities want an answer from accepted applicants on whether they’ll be hitting campus come Labor Day weekend.When high school seniors get their collegiate acceptance letters, they’ll also likely see a financial aid letter spelling out financial aid eligibility and the type, amount and source of aid for the upcoming year. With that letter in hand, students and families will need to create a financial battle plan — not just for the freshman year, but for all four years in college.

Here’s Sallie Mae’s advice on how to get the most financial aid possible:
  • Get your “Shopping Sheet.” Families should log on and download the U.S. Department of Education’s college financing “shopping sheet.” More than 600 U.S. colleges participate in the program, which essentially covers all the college financing options available to incoming freshman.
  • Ask about the Pell Grant.If a family is struggling financially, the U.S government offers Pell Grants of up to $5,645 annually.
  • Hammer away at scholarship opportunities. Sallie Mae advises maxing out on all the scholarship applications possible. To get started, visit the company’sScholarship Search Web page.
  • Keep in touch with your collegiate aid office.If you lose your job or otherwise suffer a loss of income, get in touch with your college of choice’s financial aid office right away. Often a change in income levels can earn you more financial aid — but you have to ask for it.
  • Take an “installment” approach.Sallie Mae advises families who can’t afford a lump sum payment to pursue an installment payment plan. The company says such plans are available at hundreds of colleges and universities.

Tips When Looking for Car Loans

Tips When Looking for Car Loans

If you’re stuck driving a gas-guzzling SUV, you may find yourself eyeing the fuel-efficient Toyota ( TM) Prius, or maybe the Mercedes-Benz ( DAI) Smart Car.

You’re not alone.The price of oil has passed the $120 mark, and many industry analysts believe that consumers will soon be paying $4 a gallon for gas. Many Americans are considering shifting away from big gas-guzzlers to smaller cars that won’t have as big an impact on their wallets.The economic slowdown has hurt car sales, with sales of trucks and SUVs suffering much worse than sales of more efficient small cars. General Motors ( GM) reported in April that its first-quarter truck deliveries were down 15% in 2007 compared to a 6% drop in car deliveries.Chrysler reported a similar trend in April, with a 22% decline in truck sales, year to date, although their car sales were up 6% over the same period.Before you decide to swap your gas-guzzler for a small car to reduce your fuel bills, consider how the trade will affect your finances in other ways.If you bought a new car just a few years ago, you may be stuck with an upside-down loan — that is, you may owe more money than your car is worth in resale.Also, consider how much you’ll get for your old vehicle. Less fuel-efficient cars and trucks are commanding lower prices on the second-hand market than they did before gas prices soared.”Year over year in April, there’s been a 17.5% decline in the price for SUVs,” says Tom Webb, chief economist for Manheim, an automotive auction company. “Compact cars, on the other hand, are up 2% — this even though the overall market is down 5%.”

If you do decide that a new car is right for you, you may want to consider financing the purchase with an auto loan. To get you started, here are some of the lowest rates available on car loans across the nation (all loans are based on $25,000 of financing):

  • In Miami, Fla., the Navy Federal Credit Union is offering a 36-month, 3.5% rate loan with 100% financing.
  • In Atlanta, Ga., the Bank of America, National Association is offering 36-month and 60-month loans at 4.34% with 90% financing.
  • In Houston, Texas, the Members Choice Credit Union is offering a 36-month, 4.25% rate loan with 100% financing.
  • In Detroit, Mich., the EDS Credit Union is offering a 36-month, 4.74% rate loan with 100% financing.
  • In Chicago, Ill., the Suburban Bank and Trust is offering 36-month and 48-month loans at 4.99% with 80% financing.
  • In Dallas, Texas, the Resource One Credit Union is offering a 36-month, 4.85% rate loan with 100% financing.


Things You Must Know Before the Market Opens

Things You Must Know Before the Market Opens

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Here are five things you must know for Monday, Sept. 19:

1. — U.S. stock futures were pointing to a higher start for Wall Street on Monday asoil prices rallied after Venezuelan President Nicolas Maduro said a deal between OPEC and non-OPEC countries to curb output was close.

Maduro said officials held a long meeting with Iranian President Hassan Rouhani, who over the weekend was quoted as saying he supports any move to stabilize the oil market.

West Texas intermediate crude oil rose 1.6% to $43.72 a barrel in early trading Monday.

European stocks gained Monday following Asian markets higher.

The economic calendar in the U.S. Monday includes the NAHB Housing Market Index for September at 10 a.m. EDT, and Tuesday begins a two-day meeting of theFederal Reserve, where the central bank is forecast to keep interest rates steady.

2. — Canada’s autoworkers’ union Unifor and General Motors (GM) made little progress resolving the key issue of new investment in contract talks late on Sunday, the union’s president told Reuters.

The strike deadline is 11:59 p.m. on Monday.

The automaker and the union representing its Canadian manufacturing workers have been divided over union demands that GM commit to building new vehicle models at its Oshawa, Ontario, plant, Reuters reported.

3. — Indonesia plans to pursue Alphabet’s (GOOGL) Google for five years of back taxes, and Google could face a bill of more than $400 million for 2015 alone if it is found to have avoided tax payments, a senior tax official told Reuters.

The tax office believes that PT Google Indonesia paid less than 0.1% of the total income and value-added taxes it owed last year, Reuters reported.

Most of the revenue generated in the country is booked at Google’s Asia Pacific headquarters in Singapore. Google Asia Pacific declined to be audited in June, prompting the tax office to escalate the case into a criminal one, Muhammad Hanif, head of the tax office’s special cases branch, told Reuters.

4. — French drugs giant Sanofi (SNY) filed a lawsuit against Merck’s (MRK) international unit alleging infringement of 10 patents.

In the filing in the U.S. district court of Delaware, Sanofi said the suit was triggered by a notification received from Merck in early August, in which Merck stated that it had filed a New Drug Application with the Food and Drug Administration for an insulin glargine drug product.

5. — Microsoft (MSFT) plans to shut down the London office of Skype, potentially cutting up to 400 jobs, the Financial Times reported.

Microsoft said it has “made the decision to unify some engineering positions, potentially putting at risk a number of globally focused Skype and Yammer roles,” and will be entering into a consultation process to help those affected by the job cuts.

Skype was originally founded in London in 2003 and was acquired by Microsoft in 2011 for $8.5 billion.

Former employees said the move was’t surprising given that several Skype executives have been quietly departing over the past three years. “I know it’s natural to integrate, but Skype is a shell of the company it once was,” said a former employee, who wished to remain unnamed, the Financial Times reported.


Deutsche Bank is Boosting Capital Ideas

Deutsche Bank is Boosting Capital Ideas

Deutsche Bank  (DB) , which buttressed its balance sheet last year by securitizing at least $11 billion of loans, is employing the tactic again as the lender grapples with rising investor concern about its capital adequacy.

The move would reduce risks and improve the largest German lender’s financial picture as it negotiates with U.S. regulators who proposed a $14 billion settlement of probes into mortgage-backed securities, people with knowledge of the matter said.

The deal, under the same program the bank used to securitize $5.5 billion in loans in June 2015 but for a smaller amount, is set to close next week, in time for inclusion in the German lender’s third-quarter results, said the people, who asked not to be identified because the transaction is private. Capital is the buffer of extra assets that banks are required to keep to protect depositors from losses and prevent the need for government bailouts.

While Deutsche Bank says in its annual report that such efforts are a part of routine risk-management operations, next week’s deal would be the first such transaction this year, one person said, in an indication that the lender is deploying all available means to bolster capital shy of a new equity offering. The overall size of the new deal and the amount of capital relief that would come from it couldn’t be determined. A Deutsche Bank spokeswoman declined to comment.

Deutsche Bank’s credit-default swaps — a type of financial instrument used to speculate on the likelihood of a company’s default — are trading at more than twice the average for global banks. Last week, Deutsche Bank’s CDS price surged 8.4% in a single day after the lender confirmed the size of the mortgage settlement sought by the U.S. Department of Justice.

Deutsche said it expected to reach a settlement with the U.S. for a “materially lower” amount. Still, Credit Suisse said Friday that the German lender could need an additional 7 billion euros of capital ($7.8 billion) to meet expected regulatory requirements. The bank is likely to post a loss in 2017 and may have to cut its dividend, Credit Suisse analyst Jon Peace wrote in a report. He rated the stock “underperform.”

“Weak profits and difficulties in disposing assets are slowing the capital build,” Peace wrote. “Although an organic rebuild is still possible, a potential capital raise should not be ruled out.”

Deutsche Bank’s new deal is structured as a synthetic collateralized loan obligation, or CLO — a type of financial instrument that uses derivatives to transfer the risk of losses to investors, the people said. Synthetic CLOs allow lenders to retain relationships with their customers while working like insurance policies to protect against defaults. The deals provide an alternative to a straight sale of loans, where the customer relationship transfers to the buyer.

Selling synthetic CLOs allows lenders to reclassify risky loans as higher-quality exposures, since the bank would only incur losses under a dire economic scenario. Once the loans are reclassified as less risky, the bank gets to reduce the amount of capital that must be held against them. The tradeoff is that much of the expected income stream from the loans goes instead to the investors, who stand to collect attractive coupon payments sometimes in excess of nine percentage points over benchmark money-market rates.

Other European banks including Stockholm-based Nordea and London-based Standard Chartered have used similar deals to manage risk and free up capital, which can then be applied toward new loans. Last month, Nordea securitized 8.4 billion euros of corporate and small-business loans through a synthetic CLO. In that deal, investors agreed to invest in notes that would be first to suffer losses if defaults on the loans escalate, according to a Nordea statement.

While synthetic CLOs are often sold to a small group of investors who specialize in them, the Nordea notes were bought by the Dutch pension fund PGGM, Bloombergreported last week.

In December, Deutsche Bank used a synthetic CLO to reduce its risks on a $3.5 billion portfolio of trade-finance receivables, according to a statement at the time.

The new deal is being issued under an existing program known as Craft, which is designed to accommodate a mix of corporate loans from the U.S. and elsewhere, the people with knowledge of the matter said. The last transaction under the program was in June 2015 and involved the sale of $385 million of notes that effectively insulated the lender from the first losses on a $5.5 billion collateral pool, according to Bloomberg data.

A previous deal, in March of that year, involved the sale of $139.8 million in notes that protected the lender from losses on $2.35 billion in loans.

Financial Tips for Newlyweds

Financial Tips for Newlyweds

Before you stand at the altar, it is important to know where you stand financially as a couple. You aren’t just joining together your hopes and dreams, but also combining your money habits, spending patterns and even past debt.As both the average marriage age and student debt loads rise, it is likely at least one partner will enter the marriage with significant debt. The average student loan debt is now more than $25,000, and the average credit card debt is almost $5,000 per borrower. These debts can cause significant stress on a new marriage. Revealing all debts early can ease the stress, and help the new couple start paying it down as soon as possible.

Getting married does not automatically make you responsible for debts incurred by your spouse before the marriage. Your partner’s debt will only show up on your credit history once you are added to the accounts. However, the debt will still affect you when it comes to your household’s income since there will be a lot less money to save, pay other bills or spend in ways that are much more enjoyable than debt payments.Here are 10 financial tips for newlyweds:

  • Compare spending habits.

Don’t assume your spouse shares your beliefs about money–the spending and saving habits may surprise you. Watch how they use money. A free spender before marriage will probably be a free spender after marriage.

  • Before the wedding, reveal everything in your financial closet.

Be honest about your income, debts, and money problems. Bring out your bank statements from the past twelve months to show what you did with your money. Discuss your strengths and weaknesses with money.

  • Each of you should get a copy of your credit reports from the three credit bureaus.

This will give you a clear picture of credit accounts, debts, and how creditors will judge you. Aim to get your scores over 750 to receive the lowest interest rates for your first mortgage and other loans.

  • If your partner has been married before, find out about their financial obligations to the ex-spouse and children.
  • Have a wedding and honeymoon you can pay off in a year.

The wedding of your dreams can become a nightmare if you are still paying interest on it years later.

  • Avoid credit card debt.

The best rule of thumb is simply, “if you can’t pay for something with cash, you can’t afford it.”

  • If you have a credit card balance, pay as much as you can above the minimum each month.

If you receive gift money, a bonus, a second job or a tax refund, use this to pay off your debt. You can even make micropayments multiple times during the month to pay off your balance faster. Eat a meal at home and immediately apply the money you saved to your credit card balance.

  • Before the first bills come in, decide who will pay them and when this will take place.

If you have separate accounts, know which account pays each bill. Also notify creditors of your name change and new address.

  • Reduce your debt-to-available credit ratio.

This will help improve your credit score. Your monthly debt, including your mortgage, should not exceed 35% of your gross income.

  • Each spouse should have a credit card in his or her own name to build an individual credit score.

Keep that card for a long time. Use the card for several purchases each month and pay the bill in full immediately. Building a long term payment history with one or two credit cards is an important factor in your credit score.



Painless Negotiating Tips

Painless Negotiating Tips

One of the most difficult parts of business is negotiating. It’s a skill that we develop from birth. That’s right! We come out of the womb with negotiating skills.

If you have any doubts, watch babies. Babies start their negotiation by screaming like some power-crazed corporate leader until they get what they want. Parents immediately start wondering whether the baby is hungry, wants to be held or has some other need, and they do whatever it takes to make their baby happy.As we get older, we negotiate with our parents over additional television time, presents, trips to the mall with our friends, allowance, baby-sitting fees and car time. Kids negotiate with friends for who gets to bat first in a baseball game, be the first to roll the dice in a board game or sleep on the top bunk at overnight camp.Once we become adults, we negotiate our employment agreements, apartment rent, business rent, bank loans, personal loans, car purchases, venture capital for new businesses and strategic partnerships. There is no end to the amount of negotiating we have to do throughout our life.To be a good negotiator, you have to do eight things:

1. Know your goal. You have to have an objective. It could be a 5% salary increase, 10% increase in what you want to charge a client or the percentage of a new business you must own when negotiating with investors.

2. Listen! So many people, when negotiating, are so busy thinking about what they are going to say and what they want that they don’t listen to the other side. They don’t listen to the words and how those words are used by the other side.

3. Keep your eyes open. Along with the need to be a good listener, you have to be good at observing who you are speaking with. Are they nervous, calm or distracted? Certain words or ways that you physically convey a sentence may make them react in a certain way. For example, if you sit with your arms crossed, the person on the other side may think you are holding back or not open to discussion.

4. Understand the other side. It’s essential to understand the objectives of the other side so you will understand what is important to them and what they might be willing to give up. For example, when I was negotiating my employment contract with my investors, I knew it was important that I give up my other business interests, but at the same time I knew they valued my contacts. I negotiated to keep my columns and work with various universities, which I enjoy.

5. Develop a case. Not all negotiations are built on logic, especially when you are dealing with an emotional issue like selling or buying a business from an entrepreneur or a family member. But developing good reasons for why you want something can increase your chances of getting what you want.

6. Stay dispassionate. Never lose your head and become emotional. It’s good to stay detached and objective. Passion is great for building a great business or a solid relationship, but not when you are negotiating — emotion can cause you to make a mistake.

7. Be ready to walk away. One of the best negotiators I ever met was Ira Lubert, the founder of Lubert Adler, a multibillion-dollar real estate and venture capital company. Ira started out by buying trailers for students to live at Penn State when he was an undergraduate and over time built an empire. I never forgot my first meeting with Ira in his office in 1987. He told me after a phone call that you have to be able to walk away from a deal if it doesn’t make business or strategic sense.

8. Work toward a win-win. Finally, a negotiation where the other side feels that they lost is not a successful negotiation. Leaving something on the table for the other side will build relationships. Life goes in circles, and when the other side has the upper hand someday, you’ll want them to be fair.