Filed under: Travel

• Midrange Daily Budget: 500 ZAR / Day
• This daily budget based on 2010 conversion: $74 / Day
• This daily budget thanks to today's dollar: $33 / Day
• Savings of: 55%
• Current Exchange: 1 USD = 15 ZAR
• 5 Year High: 16.00
• 5 Year Low: 6.56

• Midrange Daily Budget: 4000 RUB / Day
• This daily budget based on 2010 conversion: $133 / Day
• This daily budget thanks to today's dollar: $57 / Day
• Savings of: 57%
• Current Exchange: 1 USD = 70 RUB
• 5 Year High: 71.91
• 5 Year Low: 27.29

• Midrange Daily Budget: R$400 / Day
• This daily budget based on 2010 conversion: $240 / Day
• This daily budget thanks to today's dollar: $100 / Day
• Savings of: 58%
• Current Exchange: $1 USD = 3.95 RUB
• 5 Year High: 4.17
• 5 Year Low: 1.57

• Midrange Daily Budget: 19,000¥ / Day
• This daily budget based on 2010 conversion: $231 / Day
• This daily budget thanks to today's dollar: $155 / Day
• Savings of: 33%
• Current Exchange: $1 USD = 121.83 JPY
• 5 Year High: 125.63
• 5 Year Low: 75.76

• Midrange Daily Budget: €100 / Day
• This daily budget based on 2010 conversion: $131 / Day
• This daily budget thanks to today's dollar: $110 / Day
• Savings of: 17%
• Current Exchange: $1 USD = 0.915 EUR
• 5 Year High: 0.95
• 5 Year Low: 0.67

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Filed under: Spending

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Filed under: Checking Accounts, Savings Accounts

By Jim Gold

You don't have to sacrifice good pay to work from home.

FlexJobs, a subscription-based online service specializing in work-from-home and other flexible job postings, recently identified 10 positions that pay near or well over six figures.

"Sure, work-from-home jobs are available in lower pay grades, but it is clear that flexibility is not constrained by experience level or a high salary," said Jessica Howington, Flexjobs content team lead.

The list comes as the number of people in work-from-home jobs continues to grow. About 3.7 million employees (2.8 percent of the workforce) work from home at least half the time, according to Global Workplace Analytics.

More than 8 in 10 people surveyed about telecommuting say working from home contributes to work-life balance. Some who seek telecommuting positions say they are more productive working from home rather than an office; others say dropping commute time adds to time spent exercising and other healthful habits.

The top-paying jobs and their job descriptions that FlexJobs found:

1. Supervisory attorney, $117,000 - $152,000: Oversees less-experienced attorneys, provides legal guidance and support, supervises other attorneys and their assigned cases and staff.
2. Senior software engineer, $100,000 - $200,000: Responsible for developing and running software programs, overseeing related projects, managing a team of software engineers, troubleshooting technical issues, and debugging software.
3. Senior medical writer, $110,000 - $115,000: Reviews medical information, writes documents, edits other medical writers' submissions and works with senior management to keep projects on track at a variety of health care-related companies including medical publishers and pharmaceutical companies; usually needs a degree in a science or medical discipline.
4. Director of quality improvement, $100,000 - $175,000: As part of a company's operations and technical teams,+ is responsible for working to design and develop best practices related to systems administration and data architecture.
5. Clinical regulatory affairs director, $150,000 - $151,000: Plans, prepares and submits products for market nationally and internationally, writes regulatory documents for clinical trial applications, and assists with marketing documents.
6. Research biologist, $93,000 - $157,000: Explores and studies biology in a lab or out in the field while researching interaction of organisms and environments; specialized fields include zoology, taxonomy, physiology, population biology and ecology.
7. Director of business development, $100,000 - $151,000: Helps drive sales and revenue, responsible for established clients and new business, oversees sales teams for larger companies.
8. Environmental engineer, up to $110,000: Performs as expert to reduce environmental waste and damage, including managing ways to protect the Earth and human populations from harmful chemicals and pollution, ensuring compliance with regulations and, in some cases, assisting in development of regulations.
9. Major gifts officer, up to $90,000: Cultivates and solicits current and prospective donors for large-sum donations by using sales skills, organizational skills and working independently; extensive travel may be required.
10. Audit manager, $90,000 - $110,000: Leads, plans and executes financial and operational audits for companies or clients, works with stakeholders to understand the outcomes and impacts of the audit, ensures future compliance, and evaluates internal systems, policies and procedures.

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Filed under: Mortgages

By Marilyn Lewis

Chances are your home mortgage is the largest debt you'll ever have. How would you like to pay it off and run your mortgage contract through the shredder a lot faster than the 30 years for which most homeowners sign up?


Let's consider some ways to painlessly pay off your home loan sooner. You can choose to do it a little faster or a lot. In some cases, you'll scarcely notice the added expense.

1. Make biweekly mortgage payments

Since there are 12 months in a year, homeowners make 12 monthly mortgage payments. But if you make half-sized payments every two weeks (biweekly), you'll make 26 half-payments, the equivalent of 13 full payments.

Essentially, it is like making 13 monthly payments every year rather than the usual 12.

To go this route, call your lender and ask the best way to do it. Some lenders will set you up with biweekly payments. Or you might simply prefer to send in the extra payments by mail or electronically. Whenever you make any extra payment, however, be sure to designate it "apply to principal." Otherwise, the lender may treat the extra as a prepayment of your next regular monthly payment.

Use a calculator like this one from the Mortgage Professor to see your savings. For example, according to this calculator, if you have a 30-year fixed-rate mortgage at 3.8 percent, making biweekly payments would save $20,573 in interest over the life of the loan and pay off your mortgage four years earlier. That's a big bang for not many extra bucks.

One thing to avoid: "mortgage acceleration" products and plans. Paying down your mortgage is an easy thing to do, and you shouldn't have to pay anything to do it. No expertise or pipeline to a higher authority is required. When you see ads and pitches for mortgage "acceleration" plans, programs and products, run the other direction. (Learn more about these gimmicks here.)

2. Pour every bit of extra cash into your mortgage

Dedicate every windfall - a bonus, raise, or holiday or graduation gift - you receive toward paying down debt. Obviously, the highest-interest debt takes priority. But if you have an adequate emergency savings fund and your mortgage is your only debt, don't even ask yourself what you'll do with extra money when it falls into your hands: Add it to your mortgage payment, designating it as additional principal.

It's possible you'll find better uses for extra cash than paying down your mortgage. For example, if your mortgage rate is 3.8 percent, but you can earn 5 percent on your money elsewhere, you're obviously going to be better off earning the 5 percent. Read Stacy's discussion about the pros and cons of using extra cash to pay down your mortgage.

3. Round up your payments

The monthly payment on a $200,000 mortgage at 3.8 percent fixed over 30 years is about $932 a month. Get into the habit of rounding up that amount to $1,000. Or even $1,030, or $1,050. Do it on a regular basis, and you'll shave years off your mortgage while feeling little pain.

4. Make one extra payment a year

Give yourself a holiday gift by making an extra payment at the end of the year - or at any time. Or, if you'd rather, add an amount equal to one-twelfth of your mortgage payment to each month's payment.

For instance, with the $932 monthly payments in the example above, one-twelfth is $78. Add that to your normal payment, for a total payment of $1,010, and you'll shave 30 payments off a 30-year mortgage, paying it off in 26 years instead of 30.

5. Refinance into a shorter loan

Monthly payments are lower on longer-term loans than on shorter-term loans. But borrowers who choose shorter-term loans - such as a 15-year fixed-rate loan instead of a 30-year fixed-rate loan - stand to save a lot of money over the long haul. You can, too.

Follow these three steps to find out what you would save:

• Find current mortgage rates. A good general source is the Freddie Mac weekly mortgage market survey, updated every Thursday. But you can also look at real-life rates available in your area by visiting our mortgage search page.
• Decide if you want a fixed-rate or adjustable-rate mortgage. ARMs are typically cheaper but riskier.Here's how to decide if an ARM is right for you.
• See what you could save. Use HSH's amortizing mortgage calculator - choose "show the full table" - to compare the costs and benefits of various options.

Here's an example: If you pay 3.8 percent on a 30-year fixed-rate home loan of $200,000, your payment (principal and interest) will be $932 a month. After 30 years, you'll have repaid the $200,000, plus $135,489 in interest, money that could have gone to a college education for your kids or helped you retire earlier.

Reducing the term, or duration, of the loan usually saves money in two ways: You pay less total interest, and you often get a lower rate.

When I researched this story, the average 30-year fixed-rate mortgage was 3.8 percent. The average 15-year, fixed-rate mortgage had an average interest rate of just 3.07 percent. The monthly payments on a $200,000 loan would be $1,388, which is $457 higher than the 30-year version.

But you'd be done in half the time, paying only $49,823 in interest, instead of $135,489. That means you'd keep nearly $86,000 in your pocket rather than putting it in a lender's.

If you want to shorten your mortgage's term but 10 or 15 years feels too tight, the payments on a 20-year loan might be more comfortable.

6. Refinance and just pretend it's a shorter loan

If locking into a shorter mortgage with higher monthly payments feels scary, you can get much the same effect by refinancing - if rates are low enough to justify it - into a cheaper 30-year mortgage but paying it off on a 15-year (or 10-year or 20-year) schedule.

You won't enjoy the lower rates offered for shorter-term loans, but you'll save heaps of money on interest. To stick with our sample mortgage, the new payment on your $200,000 (3.8 percent, 30-year fixed-rate) mortgage is $932. Go ahead and pretend you're on a shorter schedule. Your monthly payment would be:

• $1,190 to pay it off in 20 years
• $1,459 to pay it off in 15 years
• $2,006 to pay it off in 10 years

Do the math yourself using the HSH calculator, or any number of other free calculators.

This option requires willpower, because you must choose a higher payment than you are required to make each month. But it gives you the flexibility of falling back to your smaller required payment if you need extra cash.

Is refinancing cost-effective?

Options 5 and 6 involve refinancing your home. Before considering those options, decide if refinancing is a good move for you.

Whether refinancing is worth it depends on the associated costs and how long you'll stay in the home. To be a good deal, you'll need to stay long enough to more than recoup your costs.

Refinancing is loaded with costs, including, but not limited to:

• A lender's origination fee
• A title search fee and title insurance
• Taxes
• A settlement professional's fees
• The cost of pulling your credit report
• An appraisal fee
• State or county tax and/or transfer fees

You can pay for these costs out of pocket at the time you refinance. Many lenders encourage borrowers to have the fees added ("rolled in") to their loan balance. But if you do, your monthly payment will grow and you'll pay additional interest.

Here's rule of thumb: Expect to pay 2 percent to 5 percent of the loan amount to refinance, says Zillow.

Estimate your own costs using MyFICO's refinance calculator. Also, you can shop around by telling several mortgage lenders how much you want to borrow and asking for their estimates of fees. Again, our mortgage search tool is a good place to start.

Tip: Don't give lenders consent to pull your credit until you're ready to actually apply for a loan.

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Filed under: Shopping

By Susan Johnston Taylor

With a new pair of shoes or a shipment of groceries just a few clicks away, American consumers have embraced the ease of online shopping. In fact, on average, Americans were expected to spend an estimated $1,804 on online shopping last year (the most of any country in the world), according to Statista's Digital Market Outlook for 2015.

But just because online shopping is easy with 24/7 access to e-commerce sites and no lines at the checkout doesn't mean that it's your best or least expensive option. Here's a look at the potential downsides of shopping online, as well as strategies for offsetting these challenges.

Shipping costs. Many retailers offer free shipping, but often with a minimum dollar amount designed to tempt you into buying more. In fact, Amazon.com recently raised its free shipping minimum for most orders to $49. "If you end up buying a bunch more and adding some filler to your order, [it] may not turn out to be the best deal," says Karl Quist, president of online shopping tool PriceBlink.com. If you decide to shop online anyway, search for a promo code and see if you can nix the shipping costs without buying more than you need. Programs like ShopRunner or Amazon Prime also offer free shipping with no minimums, but be sure to weigh the cost of membership against the total savings.

[See: 10 Money-Saving Websites to Check Before Shopping.]

Potential for overpaying. Online retailers' use of dynamic pricing means that prices for online purchases can fluctuate over the course of the day. "If you buy it at the wrong time, you could be overpaying," says consumer and money-saving expert Andrea Woroch. "It's a lot harder to change prices at a brick-and-mortar store than it is online," Woroch adds. Fortunately, tools like Paribus.co will monitor price drops and automatically request a refund on your behalf. However, a study conducted by Northeastern University also found that some e-commerce sites use "price steering," a technique to manipulate search results or customize pricing options based on data collected about the user. For example, if an e-commerce site detects that a consumer is more affluent, it might steer the consumer to personalized and pricier options.

Impulse buys. Maybe you don't need new shoes, but you get an email from your favorite retailer offering half off a second pair. Or just as you're about to close your Web browser, the chat box pops up offering you 10 percent off your next purchase. Now, instead of thinking you don't really need another pair of shoes, you're thinking about what a deal it is. Online retailers are savvy about getting you to spend more. To curb impulse buys, Woroch recommends disabling a one-click checkout option and not saving your credit card information, both of which make it easy to buy items without a second thought. And instead of shopping on your phone when you're intoxicated or bored, find other ways to keep yourself occupied. "With shopping so readily available all the time, you have that much more time to shop and spend money," she adds. Another strategy is to unsubscribe from retailer's emails or to create a separate email account. That way, you won't be tempted to buy things you don't need.

[See: 10 Ways to Protect Yourself From Online Fraud.]

Lack of real-world touch and sight. Some online retailers such as Warby Parker and Trunk Club use home try-ons or advanced fit technology (like Fits.me) to help you buy exactly what you want. Another startup, Try.com, integrates with the e-commerce sites of retailers, including Nike, Ralph Lauren and Zara, and allows consumers seven days to try on clothes for free and ship them back using a prepaid envelope if they decide not to keep the items. Conversely, in the absence of a try-on feature, not being able to feel or see it in real life means those shoes may not fit well or those throw pillows might not match your couch as you had hoped. "For clothing and home goods [such as] curtains and bedding, you want to make sure that the material is of good quality," Woroch says.

Hassle-prone returns. Free shipping and free returns allow online retailers to compete with brick-and-mortar stores. But when a dress doesn't fit or a necklace looks chintzy, do you keep it or send it back? It turns out many consumers choose the latter to avoid packing up an item and printing out a return shipping label. "We're lazy in nature, so we just don't do that," says Alex Matjanec, co-founder and CEO of MyBankTracker.com. Ironically, the more time we have to return something, the less likely we are to actually do it, finds research out of the University of Texas-Dallas, perhaps because we procrastinate and eventually decide to keep the item. Woroch recommends checking a store's return policy before you buy material goods. For bulkier items such as furniture pieces or TVs, the retailer may not offer free return shipping at all. However, in some cases you can avoid extra costs by returning the item in-store rather than shipping it back.

[Read: Smarter Ways to Shop Online.]

Retargeting. Retargeting is a tool designed by companies to lure shoppers back to a retailer's site after you've left. "You search for The North Face Agave Women's Jacket online, and the jacket begins to follow you wherever you go," Matjanec says. "Every time you get online, it's there waiting for you," he says. This can feel a little creepy, so you may want to clear your Internet browser's cookies to avoid reminders of your past product searches. On the other hand, some retailers include savings messages in their retargeting ads, so you could benefit from retargeting ads by getting a better deal on that jacket.

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Filed under: How to Save Money

By Geoff Williams

No, your pants aren't on fire. But judging by the results of a new poll, you might be comfortable lying about certain money issues to get ahead in life - even if the consequences could be grave.

The survey from NerdWallet, conducted by Harris Poll and released this week, sheds some light on how consumers feel about lying when money is at stake.

The online survey tracked the opinions of 2,115 Americans age 18 and older, asking about a variety of scenarios and whether it's OK to lie about them.

Here are the key takeaways. What do you feel crosses the line?

[See: 5 Myths About Your 401(k).]

1. Some Lies Are More Forgivable Than Others. As you might suspect, not all lies are created equal in the eyes of most Americans. Take a look at what participants were - and weren't - OK with.

Entertainment subscription accounts. Do you have Netflix or Amazon Prime, Pandora, Hulu Plus or something along those lines? Or rather, do you have family members or friends who have such a service, and they let you use it? That's OK. Well, not really, but 33 percent of Americans say using someone else's account information for online movies, music or articles to avoid paying subscription costs is acceptable.
The IRS. How about deliberately concealing under-the-table income? Twenty-four percent of Americans said not reporting that dough to the IRS was acceptable.

Eating out. You go to a restaurant, and your kid is 13 or 14 but looks younger. Should you lie about his age to get a discount at a restaurant, theme park or, say, a museum? Twenty-one percent of Americans think that kind of thing is fine, but apparently it's a little worse to lie about your own age (only 17 percent said that was permissible).

Auto insurance. What about fudging the number of miles you drive every year so you can get a lower auto insurance rate? Twenty percent of Americans say that's acceptable.

Credit cards. Lying about your income on a credit card or loan application so a financial institution will lend you more? Only 12 percent feel that's acceptable.

Life insurance. Sixteen percent of people condone lying about smoking marijuana to get lower life insurance rates, whereas only 11 percent of respondents believe it's OK to lie about smoking habits to get lower life insurance rates.

[Read: The Top 10 Lies People Put on Their Resumes.]

2. Men Lie More; Older People Lie Less. True to the stereotype, when it comes to dishonesty and dollars, men can be cads. Meanwhile, graying hair may signal honesty.

At least, when it came to this survey, male participants were likelier to condone lying than women, and older participants were more honest.

When it came to lying on a credit card or loan application, 16 percent of men were willing to lie about the information they provided, compared with only 8 percent of women. Almost twice as many men were also perfectly fine with not reporting under-the-table income to the IRS (30 percent of men versus 18 percent of women). But there was only a 3 percent difference between men and women (35 percent versus 32 percent) when it came to using someone else's account to avoid paying for online, subscription-based movies, music or articles.

As you get older, apparently you get more ethical. Only 11 percent of seniors said it was acceptable to use somebody else's paid account to watch movies or listen to music, whereas 39 percent of Americans ages 18 to 64 voted it acceptable. When it comes to fibbing about your income on a credit card or loan application, only 4 percent of retired Americans said it's OK versus 13 percent of adults who identified themselves as students.

And almost one-third of parents with kids under 18 think it's permissible to lie about their children's ages to get a discount, whereas 18 percent of childless people think that's fine.

[Read: 7 Common Tax Myths, Debunked.]

3. Fear of Consequences Helps People Decide Whether to Lie. Of course, there's no way to know what's going through someone's mind when they answer questions like these. One could argue that it's easier to be ethical about restaurant discounts when you're not the one paying for your kid's meal, and perhaps fewer seniors think it's OK to use somebody else's paid account because they're frequently the ones paying for it.

The respondents weren't asked why they felt that being honest or dishonest was acceptable in certain scenarios, but Amy Danise, an insurance editor at NerdWallet who helped put the survey together, has an educated guess.

"The people don't seem to be factoring in the consequences of the lies, since lying to the IRS is deemed more acceptable than lying about your child's age, and if you were caught in either situation, the consequences would be far worse with the IRS than lying to a restaurant," Danise says. "With a restaurant, if you're caught, 'Who cares?'"

"The lie seems to depend on the perceived likelihood of getting caught," Danise adds.

That may be why men lie about money more. "I think men have less fear of getting caught and may be, in this case, more risk-takers in general than women," Danise adds.

She also suspects that so few people find it acceptable to lie on a life insurance policy because there's a medical exam, and people know they'll probably be caught.

David Hagenbuch, a marketing professor who specializes in ethics, agrees. "My hunch is that most of the survey respondents based their ethical choices on consequences rather than on moral principles," says Hagenbuch, who teaches at Messiah College in Mechanicsburg, Pennsylvania.

"More specifically," Hagebuch says, "I'd speculate from the wide-ranging results that people's estimation of consequences was further broken down into factors such as the likelihood of getting caught, financial cost, social stigma and impact on others."

Still, one could argue that Americans aren't a lying bunch. After all, there was only one scenario in which more than 50 percent or more of respondents argued that it's OK to lie when it comes to money: using someone else's subscription entertainment account was fine with 62 percent of students and 59 percent of people ages 18 to 34. Overall, the majority of respondents said it was best to not lie.

But for those who take the jaded viewpoint, the reason we aren't lying more may be because technology has made it harder for us to lie, says Wendy Patrick, a business ethics lecturer at San Diego State University.

"We live in a technologically savvy world where it is increasingly easy to detect dishonesty," she says. "In an age of instant fact-checking, most of my students view the truth in black and white and would not dare to even fudge a date on their resumes."

But she adds, "There are some consumers, however, who continue to view honesty in multiple shades of gray. They might pass one of their children off as under 12 or themselves as a senior in order to get a discount, hoping they do not get carded."

So there's our future. As technology continues to evolve, society will become more honest - whether we like it or not.

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Filed under: Savings Experiment

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Filed under: Home Buying

By Anna Williams

Congrats! You've diligently saved up a down payment, run the numbers on what you can realistically afford and probably attended enough weekend open houses to know you're ready to call a home your own.

Now comes the actual buying part.

While it's an exciting milestone, purchasing a first home can also seem terrifying. After all, it's one of the biggest money decisions you'll ever make. And getting hit with a whole new language of unfamiliar finance terms can only add to the stress.

The good news is that home buying doesn't have to be daunting. While we can't help you decide between a ranch or a townhouse, we can give you the tools to help make sure your decision is financially sound.

So to cut out some confusion, we've rounded up eight of the most important home-buying terms and translated each into plain English. Consider this your cheat sheet to common real estate and mortgage lingo.

1. ARM

ARM stands for adjustable rate mortgage. Simply put, it's a type of home loan where your interest rate will change over time.

Most ARMs start off with a short period of a set low interest rate. But after that time is up-typically between three and 10 years-your rate becomes adjustable. That means it'll reset periodically, based on what's going on in the market. So if interest rates start sliding, you could be saving money. But the opposite can also happen: If rates rise, your monthly payment could suddenly skyrocket.

If you're the type of person who likes a little more certainty in your life, you probably wouldn't love an ARM. On the other hand, if you're not shopping for your forever home and plan to move before the fixed-rate period expires, an ARM could be a good option.

RELATED: Can't Get a Mortgage? Debt-to-Income Ratio, Explained

2. Fixed-Rate Mortgage

This type of home loan is a little more old-school than an ARM, and it's a lot more straightforward.
Whereas ARM interest rates go where the market goes, think of a fixed-rate mortgage as a more dependable choice, for better or for worse: You'll be committed to a single interest rate for the life of the loan.

That comes with its pros and cons. For example, if interest rates in the market drop, you're stuck with your higher rate. (That is, unless you refinance, which can mean some hassle and fees.) Still, if interest rates rise, you won't have to stress about suddenly having a bigger home payment.

RELATED: 10 Questions for ... a Mortgage Loan Officer

3. Assumable Mortgage

This is a less common type of mortgage (typically for ones administered by the Federal Housing Administration or U.S. Department of Veterans Affairs) where, instead of taking out a new loan, you simply take over the seller's old mortgage.

That may sound like a great deal-doesn't "pre-owned" always mean savings?-but it's a little more involved than, say, buying a used car.

It typically only makes sense if interest rates are rising. For example, if the owner's mortgage was fixed at 3%, and rates right now are 5%, you'd stand to save on interest. Bonus: You'll also likely pay less in fees, since you aren't getting a brand-new mortgage. (Though you will still have to be approved by the seller's lender.)

Plus, say you're buying the home for $250,000 and the mortgage balance is just $150,000. You'll still have to find a way to cover that difference, whether that's coming up with a bigger down payment or taking out a second mortgage.

RELATED: Mortgages 101: What You Need to Know

4. Balloon-Payment Mortgage

This is a type of mortgage where after just five or seven years of low monthly payments, you're expected to pay off the rest of the home in one, big lump sum at the end-hence, the "balloon."
Yes, it's a lot of cash to suddenly come up with. But in reality, most people never actually plan to pay that big balance at once. Rather, they'll sell their home before then or simply take out a new loan when the balloon payment comes due.

The big advantage? The interest rate for those five or seven years tends to be really low.

Here's the risk, though: There's no guarantee you'll be approved for another loan once that big payment is due. For example, say your home's value has fallen over time, or you've weathered a big pay cut at work. That'll make getting a new mortgage on the fly much harder.

RELATED: 7 Top Mortgage-Shopping Mistakes to Avoid

5. Equity

Equity tells you how much of your home you really own. In short, it's the current market value of your house minus the amount you still owe on the mortgage. For example, let's say your ranch house is worth $300,000 right now, but you're still on the hook for $150,000 in mortgage payments. You really only "own" $150,000 of the home. In other words, you have 50% equity.

As you keep making those monthly payments, your equity will grow. It can also change as the value of your home goes up (or down).

RELATED: Ask a CFP: 'Should You Ever Take Out a Home Equity Line of Credit?'

6. Escrow

"Escrow" can get confusing, because it actually has two different meanings in the real-estate world.
First, after your offer has been accepted on the home, some money will be kept in a separate escrow account until all the conditions of the contract are met. It's a way to protect both the buyer and seller.
For example, as the buyer, you don't want to hand over any money until you're sure the home passes inspection. But the seller also wants some kind of assurance that you'll actually pay before they take the home off the market.

So an escrow agent comes in as the referee. They hold a certain amount of cash from the buyer in this escrow account, along with documents from the seller, like the deed to the house. Once the contract is signed, all the assets are handed out.

But escrow account takes on a second meaning when you become a homeowner. Because your mortgage lender wants to make sure you actually pay your property tax and homeowner's insurance, they collect extra money from you every month and hold it in an "escrow account." They'll then use that money to pay those annual expenses for you-and you can both worry less knowing there is money set aside to pay those important bills.

RELATED: Your Money Bible: 25 Financial Terms Everyone Should Know

7. Earnest Money

Earnest money is a way to show a seller that you're serious about wanting to buy their property. After all, before starting a contract, sellers want to be sure that you're ready to put a ring on it-and that you're not just throwing out offers at every open house you attend.

So to show them how "earnest" you really are, you deposit a set amount of money into an escrow account (yep, that term again) with your offer. It's typically 1% to 3% of the purchase price. If all goes well and the home is yours, that cash can go toward your down payment. On the other hand, if you get cold feet and back out, the seller has an opportunity to pocket that money.

RELATED: Down Payments: What You Need to Know

8. Private Mortgage Insurance

Private mortgage insurance, aka PMI, is a type of insurance policy you'll have to take out if your down payment is less than 20%.

If you can't come up with 20%, the mortgage lender views you as a financial risk. So to protect themselves, they make you pay for PMI until you've built up a little more than 20% equity in your house. That way, if you end up defaulting, the lender will still get paid via the insurance.

Not only is PMI an extra bill you'll have to cover every month, but unlike most insurance policies you pay for, your PMI doesn't protect you-only the lender will be covered if you default. So at LearnVest, we recommend you always try to save up at least 20% for a home down payment-so you can avoid having to pay that PMI.

RELATED: Try Before You Buy: I Took a Mortgage Test Run

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Filed under: Family Money

By Jennifer Liu

There are plenty of things to prepare for when you're bringing home a baby.

One thing you might not expect, but that's surprisingly common?

Going into debt.

Nearly half (46%) of moms surveyed for BabyCenter's 2015 Cost of Raising a Child report have taken on debt to cover child-rearing expenses.

After all, caring for a little one costs about $13,000 a year, and finding that extra room in your budget isn't necessarily easy.

Still, three out of five moms admit they could raise kids for less than they spend. It's just that they want to create the "perfect" childhood.

That desire translates to a budget-busting lineup of activities, setting moms back an average of $1,391 annually. The majority (91%) say they pay as much as they do because it's what's best for their kids-not to keep up with their social circle or who's posting what to Facebook.

But it's hard to resist lifestyle inflation, and the more money earned by surveyed moms, the more they report spending ($2,600 more per child for those making at least $100,000).

And expenses further down the road are already looming: 60% worry about having enough money to fully support a child until adulthood.

Such pressure has its own costs. One in five say their relationship with their partner suffers from financial stress and the need to work more to give junior the very best.

While that impulse is understandable, these findings are a reminder that becoming a parent is a major money commitment. If you're thinking of having a baby, our handy checklist is a good place to start your financial prep.

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Filed under: Interest Rates

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Filed under: Credit Score

By Marilyn Lewis

A high credit score is your ticket to discounts in borrowing and insurance. It can also be a key to landing a job or a rental home.

Why FICO?

FICO (for Fair Isaac Corporation, the company that invented credit scoring) scores are used in an estimated 90 percent of credit decisions in the United States.

FICO is the score that lenders, bankers, landlords, merchants and other businesses check to gauge your creditworthiness.

Not long ago consumers had to pay for a peek at their official FICO scores. But that's history. Now you can get your score for free if you know where to look.

How to use your score

For free FICO scores you can thank the federal Consumer Financial Protection Bureau. The CFPB pushed the heads of major credit card companies to allow consumers no-cost, regular access to the official FICO score that lenders use, not educational scores likes the ones banks, credit card companies and others often offer consumers instead. The CFPB argued that consumers who can monitor their credit scores are able to improve their credit and avoid delinquency.

Monitoring your score adds to the control you have over your financial life. FICO scores range between 300 and 850; the higher the score, the better your creditworthiness.

Your credit score is meant to predict the risk of lending to you. It is generated when a company like FICO runs data from your creditors through a mathematical formula.

You can see that data, too, in the form of a credit report. It's smart to keep an eye on those reports, too, since they reveal what merchants and lenders are telling each other about you.

The government requires the three major credit reporting companies - TransUnion, Equifax and Experian, which collect data and produce these reports - to give consumers one free every 12 months. You can get these free credit reports from AnnualCreditReport.com. Monitoring your credit reports lets you keep an eye out for identity theft and reporting errors from creditors.

Learn more about getting credit reports and correcting errors from "How to Get Your Free Credit Report in 6 Easy Steps."

"7 Fast Ways to Raise Your Credit Score" tells how to boost your numbers.

Watch your score's movements

Still, credit reports don't include your credit score. You have to get that separately.
It is instructive and kind of fun to watch your FICO score go up or down as you borrow, repay and apply for credit. Also, an unexpected change might alert you to fraud or an error reported by a credit bureau.

How good is the score you see?

Some fluctuation in a score is to be expected. It may move around in response to how you manage your credit, pay your bills and take on new debt.

Despite the decided improvements, a big problem that remains for consumers is the inconsistency among the scores offered, even the FICO scores, writes Washington Post columnist Michelle Singletary:

Even the scores under the FICO brand can vary. FICO has updated its scoring model several times. But this does not mean that lenders use the latest versions. So even within the FICO scoring system, the score you get free could be different from the one a lender eventually pulls when you apply for credit. Still, FICO - new or old - is the go-to scoring system for most lenders.

Getting a free FICO score still takes a little finesse as it's available from a limited (but growing) number of sources. If you ask FICO for your score, be prepared for a $19.95 charge.

Here are six ways to access your official FICO score free of charge (Looking at your credit score does not affect your credit, by the way):

1. Credit cards
Banks can offer their credit-card holders a look at their FICO scores through FICO's Score Open Access.
Who's eligible: Holders of these cards can access their FICO scores, typically by checking the account online:

• Discover: TransUnion FICO scores are on monthly bills
• USAA: Enroll in free CreditCheck1
• Merrick Bank: GoScore, a free benefit, includes emailed FICO scores
• CapitalOne: CreditWise, a free benefit, lets users track FICO scores
• First Bankcard
• Bank of America
• Barclaycard US
• Citi
• Chase Slate card
• American Express

2. Auto loans
Who's eligible: Car buyers financing through these companies can see their scores:
Ally Financial
Hyundai Capital America (including Hyundai Motor Finance and Kia Motors Finance)

3. Credit unions
Who's eligible: Some credit unions give cardholders free access to FICO scores. Among them are:
Pentagon Federal Credit Union
North Carolina State Employees' Credit Union
Digital Federal Credit Union (DUC)
Pennsylvania State Employees Credit Union

4. Student loans
Who's eligible: Borrowers and co-signers of Sallie Mae Smart Option undergraduate student loans can see their FICO scores.

5. Checking accounts
See if your bank offers free FICO scores with checking accounts. Some 100 million U.S. accounts come with free FICO scores, MarketWatch reports.

6. Credit counselors
Who's eligible: You can see and talk over your FICO score by making an appointment with a credit counselor at one of the nonprofit credit-counseling agencies that purchase credit scores from Experian, a credit-reporting agency. These agencies buy credit reports and FICO scores to help in offering credit and financial counseling.

Through FICO's Score Open Access for Credit & Financial Counseling program, participating agencies can share FICO scores with members. The aim is to "aid consumers who have credit management problems by providing FICO scores along with credit education material that helps consumers understand credit scoring and learn about responsible financial health management," FICO says.

When calling one of these credit counseling agencies for an appointment, be sure to ask if you will be able to see your FICO score. If the answer is no, keep shopping. Participating national organizations include:

• National Foundation for Credit Counseling: Call 800-388-2227 or use the online agency locator to make an appointment or learn more.
• The Financial Counseling Association of America (formerly the Association of Independent Consumer Credit Counseling Agencies): Call 866-694-7253.
• Credit Builders Alliance: Qualified CBA organizations are able to share members' FICO scores with them. Call 202-730-9390.
• Local Initiatives Support Corp: Call 212-455-9800.

The NFCC explains what to expect in these private conversations:

Your visit is not reported to a credit bureau.
Visiting a credit counselor does not affect your credit score.
Nonprofit credit-counseling agencies offer help for free or at very low cost.

Alternative credit scores

Plenty of other sites offer free credit scores, just not FICO scores. If you can't get access through any of the cards or accounts above, consider an alternative score. You'll at least get a reading on your credit that you can monitor and compare over time.

Be aware that numerous websites advertise free FICO scores, but there's a potentially expensive catch: These are gateways to fee-based services. You must sign up with a credit card to get a free peek at your FICO score.

You can get free non-FICO credit scores from:

• Credit.com
• CreditKarma.com
• CreditSesame.com

FICO's score estimator

Answering 10 questions at FICO delivers an estimated range for your FICO score.

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Filed under: Saving

By Dr Penny Pincher

Frugal people who pay off their debt and achieve financial independence don't succeed by accident. They establish habits that allow them to consistently reach their goals over the long haul.

During the past few years as a personal finance blogger and author, I have noticed that the most successful frugal people tend to follow a common set of habits. These same habits remind me of the traits that Stephen Covey detailed in his popular 1989 book, The 7 Habits of Highly Effective People. For this article, I kept the original seven habits, but updated them for achieving financial independence today.

What are the seven habits that allow some people to excel at being frugal?

1. Be Proactive

Frugal people are proactive about their money, taking action to monitor and control spending and maximize income. They find ways to spend less and reduce expenses - even if it requires effort and creative thinking. They direct most of the money they save from reduced expenses into savings and investments for long term goals.

Although the first thing that comes to mind with frugality is saving money, many frugal people maximize income through side hustles or by generating passive income in addition to controlling their spending. An extra dollar saved or an extra dollar earned both contribute favorably to the bottom line.

Frugal people know how much money they have coming in and how much is going out, often with great precision. This is accomplished by creating and following a budget and proactively monitoring spending. They focus on what they can control within their budget to achieve financial success.

2. Begin With the End in Mind

Why do frugal people work so hard to control spending and keep track of their money? Are they simply not interested in buying things? On the contrary, most frugal people are striving to reach financial independence so that they can travel or launch a second career or to have plenty of money to buy the things that matter to them. Frugal people are willing to worry about money now so they don't need to worry about it later.

Surprisingly, many frugal people care more about their time than their money. Saving money buys financial independence, which buys time to do whatever you want. Frugal people want freedom to use their time as they wish and not be locked into working at a job until they reach old age.

Frugal people begin with the end in mind. The end they want to achieve is financial independence. With that end in mind, they make a plan to reach the goal and follow it every day. The sacrifices along the way are worth reaching the goal.

3. Put First Things First

What is the first thing you pay every month? Do you pay your mortgage first? Perhaps you pay your utility bill or car payment first. Frugal people pay something else first - themselves.

Paying yourself first means that you invest in your retirement fund or other savings accounts first, then you pay other bills using the money that is left. Most people pay their bills first, and then save or invest if there is any money left.

Frugal people realize that having money to invest is the most important priority, and they take care of that priority first. If there is not enough money left to pay the bills, then frugal people find ways to make their bills smaller so they can fully fund their investment goals.

4. Think Win-Win

Stephen Covey talked about win-win situations in terms of structuring deals where both parties involved get something beneficial. His point was that someone doesn't have to lose in order to make a great deal - in fact, the best deals happen in win-win situations.

Looking at this habit in the context of frugal success, just because you spend less money doesn't mean you have to benefit less or receive less value. In fact, frugal people find ways to spend less money and achieve greater benefit at the same time.

Frugal people find plenty of win-win situations for their money. For example, why do many of them prepare most of their meals at home instead of dining out? Of course, making food at home is cheaper than paying the bill at a restaurant, but eating at home is healthier as well. The benefit of making your own food goes beyond just saving money.

Buying a smaller house is less expensive than a larger house and it costs less for maintenance, insurance, heating/cooling, and lighting. In addition to the lower initial price and reduced ongoing costs, a smaller house also takes less time to clean and maintain, freeing up time for other activities.

Most win-win scenarios involve not just price, but value. Frugal people consider the overall value that a purchase would provide throughout its life, including hidden expenses and potential benefits. Frugal people are willing to spend money to get a good value, and they shop around and use coupons to get the best deal they can on the right item.

5. Seek First to Understand, Then to Be Understood

Most frugal people don't start out being frugal. They start out as "normal" spenders and rack up credit card bills and student loans like most people. Over time, they come to understand that spending and debt are not the path to contentment. They realize that sometimes less really is more, at least when it comes to debt and spending.

Frugal people reach an understanding of how much stuff they need to be happy, which is often far less stuff than most people think they need to be happy. Frugal people make spending decisions in terms of needs and wants, while most people think primarily in terms of having more and better stuff than their friends and neighbors.

As far as being understood, most frugal people don't seem to care much what "normal" people think of them. Frugal people understand that spending money to keep up with the Joneses, or anyone else, doesn't make much sense and is certainly not the path to long term contentment.

6. Synergize

Synergy is the concept that sometimes, one plus one adds up to more than just two. How is this possible?
If you decide that you can live without cable TV, you can save about $100 per month. Not only do you save $100 this month and every month thereafter, but you have significantly reduced the amount of money you need to retire by forgoing a recurring expense during your retirement years. You could retire years earlier due to the synergy of eliminating a recurring expense.

Another example of synergy is reducing clutter. If you minimize the amount of clutter you collect over time, you will require less space to store your stuff. You will be able to live in a smaller, less expensive house. With less clutter, you will be better able to find and use the items that you do have. Savings of time and money will accumulate over the years greatly exceeding the small amount of effort it takes to nip clutter in the bud. This is another example where a seemingly insignificant action can allow you to achieve your goals years earlier due to synergy. (See also: 8 Ways Clutter Keeps You Poor)

7. Sharpen Your Saw

As you are reading this, you are sharpening your saw! If you have ever tried to cut something with a dull saw, you know that it takes a lot of work and a long time to get the job done. Keeping your saw sharp is time well spent.

Sharpening your saw means to continue learning and finding new inspiration to get the most from your money. Frugal people tend to seek out ideas on saving money from blogs, podcasts, books, and by talking with other frugal friends. Reading about the financial success and failures of others can provide inspiration to keep your goals firmly in mind and on track.

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Filed under: Savings Experiment, Shopping

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Filed under: Personal Finance, Financial Education

I've said it before and I'll say it again, the hardest part is getting started. That applies to so many things in life, whether getting in shape, quitting an addiction, starting a relationship with someone you care about, and (as is most relevant to our discussion) becoming financially stable. Sometimes it can be tough to read these finance websites. Even the most basic ones will discuss subjects that seem impossible to attain: financial independence, home ownership, or even paying your bills on time. You've got to walk before you can run. If you're feeling overwhelmed by a financial situation that is in the toilet, you can change things. Here are a few ways to start turning the tide.

Debt: Know Your Enemy. Debt sucks, and some people get overwhelmed by it their whole life long. It's easy to let debt get out of hand, and to ignore the problem the worst it is. Part of this is because debt can be a source of shame and fear. Many of us have had the experience of not wanting to check the balance of our bank account, for fear that it overdrafted. Debt is even worse. It can feel like a cancer growing in your finances...and it is.

Enough of that. If you want to kill your debt, you can't dwell on the shame and fear. You've got to understand it for what it is, then pay it off. First, sit down with a pen and paper and write down what you're dealing with. It helps to see it in front of your eyes. If you have credit card debt, take careful note of the balance, the annual APR, and the available credit limit associated with that account, etc. When you have all of the sources of your debt arranged (including student loans, money you owe to your parents, etc.), arrange them in order from smallest to greatest.

From here, start paying off the accounts, starting with the smallest. Of course, maintain minimum monthly payments on all accounts. But fire every extra penny you can muster at the smallest amount, even if it's just $25 extra per month. When it is gone, take that $25 and add it to the monthly minimum payment you were paying for the now paid-off account. If that minimum was $25/month, you now have $50 free in your budget to start throwing at the second biggest debt amount every month. Rinse and repeat until your debt is gone. This may take years, and you'll have to be careful not to raise new debt in the meantime, but it's a method that works.

Spending: Know Your Limits. Many of us find it easy to spend money like it grows on trees. That works for people who don't mind being broke, but if you are determined to get your finances in order, it won't work for you. A budget will be your best friend as you pay off your debt and try to build wealth once it is vanquished. There are many good budgeting strategies out there, so I won't go into them here. Simply live well beneath your means and save the extra money, no matter what it takes.

Save and Invest: Know Your Goals. Saving and investing is about building a better future for yourself and the people you love. In the above scenario about debt, you'll be using an ever-growing monthly payment to kill off the debt. Once it's gone, that's extra money that you can use for another purpose. When you're debt free, don't start spending your extra money on stuff you want. Continue to apply the spending limits you placed on yourself in step two, and save that extra money. Build an emergency fund until it is big enough to cover your expenses for a year, just in case you got sick or lost your job. Then start to max out your IRA and/or 401(k) every year. Start to consider buying a home to save loads of money compared to rental costs. Consider getting additional education to start making more money with a stronger skill set. In short, use your new "disposable" income to ensure that you'll never again be financially screwed.

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Filed under: Financial Education

A lady stepped into my office concerned her financial advisor wasn't being straight up about her financial situation.

She had purchased a variable annuity from the advisor and admitted she wasn't quite sure how it really worked.

Uh oh. Red flag. She didn't know how it worked.

I looked into the situation and found out she had paid over $3,500 in variable annuity fees and she didn't even know it.

She fell into the trap of taking bad financial advice. In fact, it wasn't just bad financial advice, it was downright horrible financial advice.

As a financial advisor myself, I meet people on a regular basis who have implemented very poor financial advice from what I'd consider to be financial product salespeople, not true financial advisors. A true financial advisor has their clients' best interests at heart. Unfortunately, many so-called "professionals" don't.

If you're a hard-working American who focuses on your job outside of the financial industry, how are you to know when you're receiving good financial advice versus poor financial advice? How are you to know when you're being sold a good feeling rather than a good product?

Here are some instances when you should ignore financial advice.

Good financial advisors understand it will take time for clients to make a decision. If you're planning for your retirement, which might last 20 or 30 years, that's no trivial matter.

If you ever feel rushed to make a decision, ignore the financial advice. There's nothing I hate more than a pushy salesperson, so I treat my clients like I'd want to be treated: I give them time to consider their options.

You might have heard specific financial advice given to a friend, family member, or someone on television or over the radio.

Many times, the temptation can be to apply this financial advice to ourselves. But the truth is, financial advice should really only be accepted by the intended party.

Say you're driving home from work one day and you hear someone over the radio call into a popular financial talkshow. The financial advisor is telling the caller that the most important thing they could do is to pay off their mortgage.

You might think to yourself, "I have a mortgage. I have a little extra money coming in every month. Perhaps I should pay off my mortgage too!" While this is really an innocent thought, it's important to remember that your situation should be approached by priority.

If, say, you have high-interest credit card debt, it's probably best to pay off your credit cards before you start throwing money at the mortgage. You might even have a few other more pressing financial obligations to consider before you knock out that mortgage payment!

Be careful when listening to financial advice directed toward someone else. Don't assume you should do the same thing. You might be able to learn a thing or two from what other people are told, but certainly don't act on financial advice aimed toward others until you sit down with a financial professional to get a comprehensive financial plan in place.

Your financial advisor should request a great deal of information from you in order to give you the most appropriate advice for your situation.

They need to know the balance of your bank accounts. Your net income. Your tolerance for risk. How much life insurance you have. Your pets' nicknames. Okay, maybe not that last one.

In all seriousness, they do need to know a lot of information. But it's not just your current financial information they need - they need to know your financial history and your financial future, as well.

Financial history is easy to give. But what about your financial future? Well, this is your intended or assumed financial future.

For example, will you buy a second vacation home in retirement? How much money will you need to live on when you're 80? How likely are you going to need to financially support family members in the future? All of these questions matter.

If your financial advisor hasn't taken the time to explore your financial history, present, and future, ignore the advise until they do so. The more work you put into this in the beginning, the better your financial wellbeing will be later on.

Unfortunately, when individuals are left to the advice they'd give themselves, the advice isn't always the best. Why? Emotions.

Consider the stock market crash after 9/11. Many people called their financial advisors wanting out of the stock market. Against their advisors' warnings, they pulled their money out.

Over time, the stock market recovered, and many were left without recourse because they needed the money for retirement. They decided they'd only listen to their own advice, not the advice of the professionals. And, unfortunately, the cost was astronomical.

It's always a good idea to run your financial ideas past others. Ask several financial advisors for their opinions. Ask your friends and family who know you best. Gather as much advice as you can find. Then, once you've considered all of your options, consider what would be the wisest course of action to take and take it.

If financial advice feels too easy to execute, it might be too simple to be right. Life, unfortunately, is complicated. And, if you want to solve life's problems, many times it's going to involve a plan that isn't a walk in the park.

"Just buy gold! It's all you need!"

"The default mutual funds for your 401(k) are good enough."

"Whole life insurance is the best investment for you"

"Nobody knows what the future holds, so just live for the moment!"

This is all horrible financial advice. It's too simple. It's too easy to implement. It's advice that would only work in an ideal world.

Not all advice is good advice. Test it before you implement it.

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Filed under: Savings Experiment

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Filed under: Savings Experiment

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