June 20, 2013

The History of Foreign Exchange

September 22, 2011 By Leave a Comment

The foreign exchange market monitors the value of American currency in relation to economies of other countries. There are thousands of individuals across the country who participate in foreign exchange trading, and many people are able to earn good returns on their investments.

Prior to 1970, the United States government had strict laws in place restricting foreign exchange trading. After these laws were lifted, the amount of money in the foreign exchange market has grown rapidly. As of 2010, almost 4 trillion dollars were exchanged per day. Large banks across the globe, as well as other financial institutions take part in foreign exchange trading as well.

An online trading broker can be helpful for those who are first getting into the foreign exchange marketplace. Selecting a person who is trained and understands the market well is important, since the foreign exchange world can be very complicated. Many of the exchanges are not done with any intent to keep the foreign currency; it is only purchased in anticipation that the exchange rate will go up in the near future.

Some investment firms also use foreign exchange as a way to earn extra income on the funds in accounts. Even retailers sometimes participate, since stores that are located across the world will be dealing with multiple types of currencies. For these businesses, extra cash can come from swapping the dollars for money of other countries.

Choosing investing as a way to amplify personal finance is a smart way to make more money. Foreign exchange can be a great option, in addition to investing in stocks, mutual funds, or other choices.

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How to Qualify for Bankruptcy

July 26, 2011 By Leave a Comment

If you are considering filing for bankruptcy, but are unsure of which chapter to file or how to begin the filing process, there are a few options you can consider.

Chapter 7 versus Chapter 13

There are two main types of bankruptcy available to individuals. Chapter 7 bankruptcy involves a complete liquidation of assets and the sale of those assets to the debtor’s creditors. Chapter 13 involves a complete restructuring of personal finances in order to pay off debts.

In order to file for Chapter 7 bankruptcy, one must meet certain criteria, including passing a means test. The test evaluates the person’s median state income to decide if the he is worthy of the relief provided by filing for this type of bankruptcy. The mean is calculated by taking the individual’s income over the last six months, annualizing it, then comparing it to the income of households of the same size in the debtor’s home state. If the debtor makes less than or equal to the state median income, he qualifies to file for Chapter 7 bankruptcy.

Chapter 13 bankruptcy is not a liquidation of assets, but a restructuring of debts to make the payment process more manageable for the debtor. This process involves negotiating a payment plan between the debtor and creditors in which the debtor agrees to pay his debt partially or fully over the course of the agreement, which can last for up to five years. In that time, the creditor is forbidden from making collection calls or other debt collection efforts, unless the debtor defaults on the agreed payment plan.

In order to qualify for a Chapter 13, the person filing must have a steady income and be able to make payments to avoid fines, as the court system supervises the filing from the beginning to the end.

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Filed Under: Business, Finance, Investments Tagged With: , ,

Don’t Be Afraid of the Checkbook

July 17, 2011 By Leave a Comment

It won’t bite you. Seriously. It always seems to be a mystery how some people seem to not want to ever record their finances in that little black book. Maybe it’s the math skills? Or simply a lack of precision and efficiency in keeping tabs on the money? Who knows. Whatever the case, here’s why it’s important to use that checkbook.

An example of a cheque.

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Essentially, you keep yourself covered. Simple as that. You never know just what might happen with your finances that might screw you up in a big way. For instance: checks that are pending. To make sure you know exactly what’s in your account on a spending level is important. The bank might say something like $1,276 in your balance, but your checkbook will say $276. Why? Because you wrote a check a day or two ago, and it hasn’t cleared, yet. The bank doesn’t know that — but you do. This keeps you in check from spending more money that you don’t really have. Get it?

Moreover, yes, it’s possible that banks can make mistakes. Making sure you reconcile your balance with any statements your bank sends you will ensure that everything’s kosher on the dollar arena, and you know you won’t get slammed by anything the bank wasn’t aware of. It does happen, and that’s why banks have phone numbers — for you to contact them and complain about this fee or that fee!

The checkbook really isn’t supposed to be this scary thing filled with lines and blocks and numbers! It’s a tool to help you manage your finances. Use it.

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Filed Under: Banking, Business Tagged With: , ,

Tax Tips for Freelancers

July 13, 2011 By Leave a Comment
Seal of the United States Internal Revenue Ser... 

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If you are self-employed, you likely do not have taxes taken out of a paycheck. You may feel a certain sense of freedom for most of the year, when you can do what you want with your money, until tax season shows up. To avoid panicking at the amount you owe the government in April, consider some ways to deal with this issue year round.

Many established freelancers have learned to pay quarterly taxes. This involves estimating what you will owe four times per year, and then sending a check to the IRS. If you overestimate, you will get a refund during tax time, while you will simply have to pay more at that time if you underestimate. This method may not let you keep your money through the year, but it prevents you from going broke every April.

Whether or not you pay quarterly taxes on your freelance income, you should keep your financial documents organized for when you do file. If you have business expenses that you would like to write off, keep the receipts in a safe file, separate from personal receipts. You should also keep any paychecks or other proof of income set aside, or even documented in a computer file so that you can quickly look at it when filling out tax forms.

If you are confused on what you can claim, and whether you should pay quarterly taxes, it is often worth it to consult an accountant. If the cost concerns you, find a coupon for this service, or wait until after tax time so that accountants are eager enough for your business to provide an inexpensive consultation. Meeting at least once can help you get any questions answered.

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