Common Mistakes Made With Money and How to Avoid Them
Everybody makes mistakes with their money. The important thing is to keep them to a minimum. And one of the best ways to accomplish that is to learn from the mistakes of others. Here is our list of the top mistakes people make with their money, and what you can do to avoid these mistakes in the first place.
1. Buying items you don't need...and paying extra for them in interest.
Every time you have an urge to do a little "impulse buying" and you use your credit card but you don't pay in full by the due date, you could be paying interest on that purchase for months or years to come. Spending money for something you really don't need can be a big waste of your money. But you can make the matter worse, a lot worse, by putting the purchase on a credit card and paying monthly interest charges.
Research major purchases and comparison shop before you buy. Ask yourself if you really need the item. Even better, wait a day or two, or just a few hours, to think things over rather than making a quick and costly decision you may come to regret.
There are good reasons to pay for major purchases with a credit card, such as extra protections if you have problems with the items. But if you charge a purchase with a credit card instead of paying by cash, check or debit card (which automatically deducts the money from your bank account), be smart about how you repay. For example, take advantage of offers of "zero-percent interest" on credit card purchases for a certain number of months (but understand when and how interest charges could begin).
And, pay the entire balance on your credit card or as much as you can to avoid or minimize interest charges, which can add up significantly.
If you pay only the minimum amount due on your credit card, you may end up paying more in interest charges than what the item cost you to begin with. Example: If you pay only the minimum payment due on a $1,000 computer, let's say it's about $20 a month, your total cost at an Annual Percentage Rate of more than 18 percent can be close to $3,000, and it will take you nearly 19 years to pay it off.
2. Getting too deeply in debt.
Being able to borrow allows us to buy clothes or computers, take a vacation or purchase a home or a car. But taking on too much debt can be a problem, and each year millions of adults of all ages find themselves struggling to pay their loans, credit cards and other bills.
3. Learn to be a good money manager.
Recognize the warning signs of a serious debt problem. These may include borrowing money to make payments on loans you already have, deliberately paying bills late, and putting off doctor visits or other important activities because you think you don't have enough money.
If you believe you're experiencing debt overload, take corrective measures. For example, try to pay off your highest interest-rate loans (usually your credit cards) as soon as possible, even if you have higher balances on other loans. For new purchases, instead of using your credit card, try paying with cash, a check or a debit card.
There are also reliable credit counselors you can turn to for help at little or no cost. Unfortunately, you also need to be aware that there are scams masquerading as 'credit repair clinics' and other companies, such as 'debt consolidators,' that may charge big fees for unfulfilled promises or services you can perform on your own.
4. Paying bills late or otherwise tarnishing your reputation.
Companies called credit bureaus prepare credit reports for use by lenders, employers, insurance companies, landlords and others who need to know someone's financial reliability, based largely on each person's track record paying bills and debts. Credit bureaus, lenders and other companies also produce "credit scores" that attempt to summarize and evaluate a person's credit record using a point system.
While one or two late payments on your loans or other regular commitments (such as rent or phone bills) over a long period may not seriously damage your credit record, making a habit of it will count against you. Over time you could be charged a higher interest rate on your credit card or a loan that you really want and need. You could be turned down for a job or an apartment. It could cost you extra when you apply for auto insurance. Your credit record will also be damaged by a bankruptcy filing or a court order to pay money as a result of a lawsuit.
So, pay your monthly bills on time. Also, periodically review your credit reports from to make sure their information accurately reflects the accounts you have.
5. Having too many credit cards.
Two to four cards (including any from department stores, oil companies and other retailers) is the right number for most adults. Why not more cards?
The more credit cards you carry, the more inclined you may be to use them for costly impulse buying. In addition, each card you own — even the ones you don't use — represents money that you could borrow up to the card's spending limit. If you apply for new credit you will be seen as someone who, in theory, could get much deeper in debt and you may only qualify for a smaller or costlier loan.
Also be aware that card companies aggressively market their products on college campuses, at concerts, ball games or other events often attended by young adults. Their offers may seem tempting and even harmless — perhaps a free T-shirt or Frisbee, or 10 percent off your first purchase if you just fill out an application for a new card — but you've got to consider the possible consequences we've just described. Don't sign up for a credit card just to get a great-looking T-shirt. You may be better off buying that shirt at the store for $14.95 and saving yourself the potential costs and troubles from that extra card.
6. Not watching your expenses.
It's very easy to overspend in some areas and take away from other priorities, including your long-term savings. Our suggestion is to try any system — ranging from a computer-based budget program to hand-written notes — that will help you keep track of your spending each month and enable you to set and stick to limits you consider appropriate. A budget doesn't have to be complicated, intimidating or painful — just something that works for you in getting a handle on your spending.
7. Not saving for your future.
We know it can be tough to scrape together enough money to pay for a place to live, a car and other expenses each month. But experts say it's also important for young people to save money for their long-term goals, too, including perhaps buying a home, owning a business or saving for your retirement (even though it may be 40 or 50 years away).
Start by "paying yourself first." That means even before you pay your bills each month you should put money into savings for your future. Often the simplest way is to arrange with your bank or employer to automatically transfer a certain amount each month to a savings account or to purchase a Savings Bond or an investment, such as a mutual fund that buys stocks and bonds.
Even if you start with just $25 or $50 a month you'll be significantly closer to your goal. The important thing is to start saving as early as you can — even saving for your retirement when that seems light-years away — so you can benefit from the effect of compound interest. Compound interest refers to when an investment earns interest, and later that combined amount earns more interest, and on and on until a much larger sum of money is the result after many years.
Banking institutions pay interest on savings accounts that they offer. However, bank deposits aren't the only way to make your money grow. Investments, which include stocks, bonds and mutual funds, can be attractive alternatives to bank deposits because they often provide a higher rate of return over long periods, but remember that there is the potential for a temporary or permanent loss in value.
8. Paying too much in fees.
Whenever possible, use your own financial institution's automated teller machines or the ATMs owned by financial institutions that don't charge fees to non-customers. You can pay $1 to $4 in fees if you get cash from an ATM that isn't owned by your financial institution or isn't part of an ATM "network" that your bank belongs to.
Try not to "bounce" checks — that is, writing checks for more money than you have in your account, which can trigger fees from your financial institution (about $15 to $30 for each check) and from merchants. The best precaution is to keep your checkbook up to date and closely monitor your balance, which is easier to do with online and telephone banking. Remember to record your debit card transactions from ATMs and merchants so that you will be sure to have enough money in your account when those withdrawals are processed by you bank.
Financial institutions also offer "overdraft protection" services that can help you avoid the embarrassment and inconvenience of having a check returned to a merchant. But be careful before signing up because these programs come with their own costs. Whenever possible, use your own financial institution's automated teller machines or the ATMs owned by institutions that don't charge fees to non-customers.
Pay off your credit card balance each month, if possible, so you can avoid or minimize interest charges. Also send in your payment on time to avoid additional fees. If you don't expect to pay your credit card bill in full most months, consider using a card with a low interest rate and a generous "grace period" (the number of days before the card company starts charging you interest on new purchases).
9. Not taking responsibility for your finances.
Do a little comparison shopping to find accounts that match your needs at the right cost. Be sure to review your bills and bank statements as soon as possible after they arrive or monitor your accounts periodically online or by telephone. You want to make sure there are no errors, unauthorized charges or indications that a thief is using your identity to commit fraud.
Keep copies of any contracts or other documents that describe your bank accounts, so you can refer to them in a dispute. Also remember that the quickest way to fix a problem usually is to work directly with your bank or other service provider.

Labels: Common Money Mistakes to Avoid

Homebuyers: How To Save Thousands of Dollars When You Buy
"When you analyze those successful homebuyers who have the experience to purchase the home they want for thousands of dollars below a seller’s asking price, some common denominators emerge."
If you’re like most homebuyers, you have two primary considerations in mind when you start looking for a home. First, you want to find a home that perfectly meets your needs and desires, and secondly, you want to purchase this home for the lowest possible price.
When you analyze those successful homebuyers who have been able to purchase the home they want for thousands of dollars below a seller’s asking price, some common denominators emerge. Although your agents negotiating skills are important, there are three additional key factors that must come into play long before you ever submit an offer.
These Steps Will Help You Save Thousands When You Buy a Home
Make sure you know what you want . . . As simple as this sounds, many home buyers don't have a firm idea in their heads before they go out searching for a home. In fact, when you go shopping for a place to live, there are actually two homes competing for your attention: the one that meets your needs, and the one that fulfills your desires. Obviously, your goal is to find one home that does both. But in the real world, this situation doesn't always occur.
When you're looking at homes, you'll find that you fall in love with one or another home for entirely different reasons. Is it better to buy the 4 bedroom home with room for your family to grow, or the one with the big eat in kitchen that romances you with thoughts of big weekend family brunches? What's more important: a big backyard, or proximity to your child's school? Far too often people buy a home for the wrong reasons, and then regret their decision when the home doesn't meet their needs.
Don't shop with stars in your eyes: satisfy your needs first. If you're lucky, you'll find a home that does this and also fulfills your desires. The important thing is to understand the difference before you get caught up in the excitement of looking.
Find out if your agent offers a “Buyer Profile System” or "Househunting Service", which takes the guesswork out of finding just the right home that matches your needs. This type of program will cross-match your criteria with ALL available homes on the market and supply you with printed information on an ongoing basis. A program like this helps homeowners take off their rose colored glasses and, affordably, move into the home of their dreams.
To help you develop your homebuying strategy, use this form:
What do I absolutely NEED in my next home:
______________________________
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What would I absolutely LOVE in my next home:
_______________________________
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How Sellers Set Their Asking Price
For you to understand how much to offer for a home you’re interested in, it’s important for you to know how sellers price their homes. Here are 4 common strategies you’ll start to recognize when you begin to view homes:
1. Clearly Overpriced:
Every seller wants to realize the most amount of money they can for their home, and real estate agents know this. If more than one agent is competing for your listing, an easy way to win the battle is to over inflate the value of your home. This is done far too often, with many homes that are priced 10- 20% over their true market value.
This is not in your best interest, because in most cases the market won't be fooled. As a result, your home could languish on the market for months, leaving you with a couple of important drawbacks:
your home is likely to be labelled as a "troubled" house by other agents, leading to a lower than fair market price when an offer is finally made
you have been greatly inconvenienced with having to constantly have your home in "showing" condition . . . for nothing. These homes often expire off the market, forcing you to go through the listing process all over again.
2. Somewhat Overpriced:
About 3/4 of the homes on the market are 5-10% overpriced. These homes will also sit on the market longer than they should. There is usually one of two factors at play here: either you believe in your heart that your home is really worth this much despite what the market has indicated (after all, there's a lot of emotion caught up in this issue), OR you've left some room for negotiating. Either way, this strategy will cost you both in terms of time on the market and ultimate price received
3. Priced Correctly at Market Value
Some sellers understand that real estate is part of the capitalistic system of supply and demand and will carefully and realistically price their homes based on a thorough analysis of other homes on the market. These competitively priced homes usually sell within a reasonable time frame and very close to the asking price.
4. Priced Below the Fair Market Value
Some sellers are motivated by a quick sale. These homes attract multiple offers and sell fast - usually in a few days - at, or above, the asking price. Be cautious that the agent suggesting this method is doing so with your best interest in mind.

Labels: Save Thousands When You Buy

Kensington Home For Sale Coming Soon! Kensington CA Real Estate at its best! 5 Highland Blvd offers wonderful walls of glass with Bay views from almost every room! Warm, glowing hardwood floors throughout, Master Suite w/updated bathroom and office/nursery room, Open kitchen w/granite slab counter tops, lower area perfect as in-law or au-pair with separate laundry, kitchen, bath and entrance, spectacular back patio with custom flagstone surface area and pond w/waterfall, massive lot which allows the opportunity to build a second house behind! Truly a must see and rare opportunity. Brought to you by Realtors Dave and Carla Higgins . Learn more about Dave and Carla's exciting real estate programs including the East Bay Guaranteed Sale Program where you can move up to this house and have Dave and Carla buy yours! Lastly - Dave and Carla are the only realtors in the area that will offer their buyers 100% satisfaction on their home purchase! Find out more about Dave and Carla's Real Estate Buyers Protection Plan here!

Oakland Real Estate at its finest!

Labels: Piedmont Alameda, Real Estate, Safe Neighborhoods

We have been getting numerous calls from sellers in the greater Oakland, Berkeley and East Bay market area telling us that they are considering the sale of their home but are wondering if now is a good time to sell with current market conditions favoring the buyer at this time. We have been highly focused on this issue for several months now and do our best to always communicate with industry leaders both locally and nationally to help us better understand the broader implications of this East Bay market change. We also believe It is our responsibility to make sure that we don't suggest strategies that are short term reactionary responses to local market changes based on worry or fear. We recently had a lengthy conversation with one of the top local East Bay real estate appraisers who is fully versed on market activity in Oakland, Piedmont, Berkeley, Albany, Kensington, El Cerrito, Alameda as well as many other near by communities. In a nut shell when we asked him what he saw in the market place he responded by saying that "the less expensive the property was, the harder it was to sell." He went on to say that properties in the upper end neighborhoods approaching the million dollar range or greater were still selling with shorter market times and often selling in multiple offers and for over asking. This phenomenon is also continuing in the hot neighborhoods around solid and fun retail streets. Upper Rockridge, Trestle Glen, Crocker Highlands, Piedmont, Berkeley Hills and Alameda still have a market that favors sellers when the home is marketed and priced correctly. One program that we are exclusively offering to all of our buyers who make offers on our listings is a buyers protection plan aimed at easing the fears of buyers and helping them pull the trigger on a home purchase. With this program, if the buyer is not 100% satisfied with the purchase of their home in the first 18 months, we offer to buy it back or sell it for free 'BUYERS PROTECTION PLAN' Regarding the question of when is a good time to sell is, our response is this, if you plan on selling one way or another in the next five years then we believe you should sell now. The last down real estate cycle lasted approximately seven years with the following pattern: The first three years were market decline where homes continued to loose value, the next three years the market was basically flat and the general public had a distaste for real estate and the last year showed a mild pick-up in the market signaling the change toward a sellers market again. We are currently in the second year of this cycle so if you do not want to sell now you should be prepared for a possible continued loss in equity and understand your options should the market prophecies of the last down cycle repeat themselves. Things to understand are as follows; How much equity do you have in the property and can you sell without taking an actual loss? Do you have a pre-payment penalty attached to your loan and if so when does it expire? Do you own a home in one of the still hot neighborhoods or are you in one of the less fortunate. If you would like more information regarding these questions, thoughts as well as other real estate tips and support click this link and we are happy to help! Great Real Estate Information!

As always - Thanks for reading and may you have a prosperous real estate experience!

Dave and Carla Higgins
(888) 627-4399
info@DaveAndCarla.com
http://www.daveandcarla.com/
http://www.oaklandhomefinder.com/

Keller Williams Realty

Labels: Berkeley, East Bay Oakland, Piedmont Alameda, Real Estate, Safe Neighborhoods

We have some Clients in Montclair who wanted tips on fixing up their home. Here is a great article on this subject
Fixing Up Your Home: Protect Your Housing Investment
Your home is an investment in living as well as in savings. If neglected, it will pay no dividends. If properly maintained and improved, it will pay a high yield in comfort and usefulness for your family and in avoidance of costly repair bills. Home improvements also tend to raise neighborhood standards and, as a result, property values. From an economic standpoint, home improvements mean higher employment, increased markets for materials and home products--and therefore a more flourishing community.
If You Do It Yourself
If you are handy with tools and have the experience, you can save money by doing many jobs yourself. But unless you are skilled in wiring, plumbing, installing heat systems, and cutting through walls, you should rely on professionals for such work.
When you buy the required materials, it pays not to skimp. Good materials are not necessarily the most expensive. What you need are products that look good, are easy to maintain, and last a long time. Buy only from reliable dealers.
If You Use a Contractor
If you plan to use the services of a dealer or contractor, take care to choose one with a reputation for honesty and good workmanship. There are several ways to check on a contractor:
Consult your local Chamber of Commerce, the Better Business Bureau, or Local Consumer Protection Agency.
Talk with people for whom he has done work.
Ask your lender about him, if you plan to finance the project with a loan.
Check his place of business to see that he is not a fly-by-night operator.
Find out, if you can, how he rates with known building-product distributors and wholesale suppliers.
Ask friends and relatives for names of firms that they could recommend.
Compare Contractor Offers
Before deciding on a contractor, you may want to get bids from two or three different firms. Make sure that each bid is based on the same specifications and the same grade of materials. If these bids vary widely, find out why.
Many contractors offer package plans that cover the whole transaction. Under such a plan the contractor provides all materials used, takes care of all work involved, and arranges for your loan.
Your contractor can make the loan application for you, but you are the one who must repay the loan, so you should see that the work is done correctly.
Understand What You Sign
The contract that both you and the contractor sign should state clearly the type and extent of improvements to be made and the materials to be used. Before you sign, get the contractor to spell out for you in exact terms:
How much the entire job will cost you.
How much interest you will pay on the loan.
How much you will pay in service charges.
How many payments you must make to pay off the loan, and how much each of these payments will be.
After the entire job is finished in the manner set forth in your contract, you sign a completion certificate. By signing this paper you certify that you approve the work and materials and you authorize the lender to pay the contractor the money you borrowed.
Beware of Fraud
Most dealers and contractors conscientiously try to give their customers service equivalent to the full value of their money. Unfortunately, home improvement rackets do exist. Here are a few common sense rules to follow:
Read and understand every word of any contract or other paper before you sign it.
Never sign a contract with anyone who makes fantastic promises. Reputable dealers are not running give-away businesses.
Avoid wild bargains. The best bargain is a good job.
Never consolidate existing loans through a home improvement contractor.
Do not let salespeople high-pressure you into signing up to buy their materials or services.
Be wary of salespeople who try to scare you into signing for repairs that they say are urgent. Seek the advice of an expert as to how urgent such repairs are. High-pressure and scare tactics are often the mark of a phony deal.
Avoid salespeople who offer you trial purchases or some form of bonus, such as cash, for allowing them to use your house as a model for any purpose. Such offers are well-known gimmicks of swindlers.
Never sign a completion certificate until all the work called for in the contract has been completed to your satisfaction. Be careful not to sign a completion certificate along with a sales order.
Proceed cautiously when the lender or contractor demands a lien on your property.

Adversity – or Opportunity?

A dear friend of ours just informed us that he has just been diagnosed with prostrate cancer and he is terrified. Dave & I tried to be as comforting and supportive as we could but alas found ourselves stumbling over our tongues. Then we thought about the power of words to comfort and inspire, and we put together some of our favorite quotes about overcoming adversity – for our friend, and for you:
Adversity causes some men to break, others to break records.
– William A. Ward

The difficulties of life are intended to make us better, not bitter.
– Author Unknown

We have no right to ask when sorrow comes, “Why did this happen to me?” unless we ask the same question for every moment of happiness that comes our way.
– Author Unknown

When it is dark enough, you can see the stars.
– Ralph Waldo Emerson

All the world is full of suffering. It is also full of overcoming it.
– Helen Keller

A bend in the road is not the end of the road...unless you fail to make the turn.
– Author Unknown

When everything seems to be going against you, remember that the airplane takes off against the wind, not with it.
– Henry Ford

And finally this, from Winston Churchill: If you're going through hell, keep going.

Labels: adversity

A Lot of homes in Crocker Highlands, Piedmont, Berkeley and the Greater East Bay Area are older and have some less than steller wood floors. If you have stains on your wood floors here are some tips to help bring back the luster.

Remove Stains from Your Hardwood FloorTired of looking down at your hardwood floor and seeing stains that have been left behind by some accident? Removing stains from your hardwood floor is probably not as difficult as you first may think, but the process will require time. The results and saved money are worth the effort. The following seven steps will guide you through this process.
STEP 1Sand the stain away. You will want to use a vibrating-type sander, such as a palm sander. DO NOT use a belt sander. Their power will ruin your floor before you realize it. Begin with medium (100-grit) sandpaper, and end with fine (150-grit) sandpaper to smooth.
STEP 2After the stain is sanded away, vacuum the dust and wipe the area with a dampened cloth. If you’re using an oil-based satin, dampen the cloth with mineral spirits. If you’re using a latex stain, dampen the cloth with water.
STEP 3Now, find a stain that matches the rest of the floor. To do this, choose two or three cans of stain that appear to be close to your floor color and start mixing them to try and find the right color. Make sure you document the amount of stain you added to each mix for future reference. Do not mix oil-based stains with latex stains.
STEP 4Test the different mixes on a piece of sanded, unstained wood that matches the wood of your floor. While the stain is still wet, check to see if you found a match. The wet stain will allow you to see what the stain will look like when it has been coated with polyurethane.
STEP 5If the color does not match, try mixing in a lighter or darker stain.
STEP 6When you find the right color, stain the floor.
STEP 7After the stain is dry, polyurethane the floor according to the manufacturer’s instructions.

Labels: Removing Stains From Hardwood Floors

What Can You Learn From Geese?

One of Kylie and Lola’s favorite things to do is to go to Lake Merritt, near our home, and feed the geese.

From all of our times feeding the geese Dave and I noticed there’s power in a gaggle of geese that you just don’t find in a lone goose. For example:

Fact: As each goose flaps its wings, it creates lift for the bird following. By flying in a “V” formation, the whole flock adds 71% greater flying range than if one goose flew alone.

Lesson: Those who share a common direction and sense of unity can get where they’re going quicker and easier because they’re drawing strength from each other.

Fact: When a goose falls out of formation, it suddenly feels the drag and resistance of trying to fly alone, and quickly gets back into formation to take advantage of the lifting power of the bird in front.

Lesson: Stay in formation with those who are headed where we want to go; be willing to accept their help and give help to others.

Fact: When the lead goose gets tired, it rotates back into the formation and another goose flies at the point position.

Lesson: It pays to take turns doing the hard tasks and sharing leadership. People, like geese, are interdependent on each other.

Fact: Geese look after each other. If one gets sick or wounded, two geese follow it down to protect and feed it until it either recovers or dies.

Lesson: Stand by each other in difficult times as well as in good times.

And when you hear those geese honking? They’re offering encouragement to their leader, something everyone – not just leaders – needs!

We were recently reading an article that discussed the “Costs – and Rewards – of Being a Parent”.Studies show that a middle-income family will spend $160,140 to raisea child to 18 years old. Is it worth it? How do children stack up as a"return on investment"?$160,140 translates into $8,896 a year, $741 a month, $171 a week, $24a day, $1 an hour. Then we thought about Kylie and Lola and about what we get for $1 an hour?Well, for $1 an hour, you never have to grow up, because:You get to frame rainbows and hearts, and get handprints set in clay for Mother's Day, and cards with backward letters for Father's Day.
You get to finger-paint, carve pumpkins, play hide-and-seek , and never stop believing in Santa Claus.You have an excuse to keep reading the adventures of “ Piglet and Pooh”,watching cartoons, going to silly movies, and wishing on stars.
What else do your get for your $1 an hour?Glimpses of magic every day.Giggles under the covers every night.More love than your heart can hold. A hand to hold, usually covered with jam.A partner for blowing bubbles,flying kites, building sandcastles, andskipping down the sidewalk in the pouring rain. You get someone to laugh yourself silly with no matter what the boss said that day.
For $1 an hour, you get to be a hero:Just for retrieving a Frisbee off the garage roof, or taking thetraining wheels off the bike.You get a front row seat to history to witness the first step, first. You get to be immortal. You get an education in psychology, nursing, criminal justice,communications, and human sexuality that no college can match.In the eyes of a child, you are all-knowing and all-powerful.You have all the power to heal a boo-boo, scare away the monsters under the bed, patch a broken heart, police a slumber party, ground them forever, and love them without limits, so one day they will, like you, love without counting the cost.Sounds like the best $1 you can spend!

Labels: Cost of being parents

Oakland MLS Market Statistics
Comparison of July 2006 - July 2007
Active 1567 1401
Status to Pendg 279 228
Status to Sold 290 267
Avg Days on Mkt 40 58
High Price $5mill $3.2mill
Low $200K $175K
Avg List Price $630K $610K
Avg. Sold $579K $587K

Oakland MLS Market Statistics
Comparison of July 2006 - July 2007
Active 1567 1401
Status to Pendg 279 228
Status to Sold 290 267
Avg Days on Mkt 40 58
High Price $5mill $3.2mill
Low $200K $175K
Avg List Price $630K $610K
Avg. Sold $579K $587K