photo credit: Laure Wayaffe

Smarty Pig is a new idea, started by two individuals, Mike Ferrari and Jon Gaskell. The basic gist of it is this: you want a new ipod, a Hawaiian vacation, a new bike, etc. First you start a profile on the site, then you establish your savings account and goal, and figure out your monthly contribution. Then you have the option to share with friends and family your savings goal so they can track your progress and make donations if they would like. Start saving, and before long you’ll meet your goal!

There are no fees, you earn interest on your balances, and it’s FDIC insured, just like a high yield online savings account. What a great idea! The minimum savings goal is $250, and the maximum is $100,000. To get the account started, there has to be a deposit of $25 made to the account. Interest accrues daily but is posted quarterly. Once you reach your savings goal, you can request a Smarty Pig MasterCard® Debit Card which has the funds loaded on that you’ve saved up. You can then use your card to book your vacation, buy your bike, or do whatever you’d like with it. You also have the option to get a retail gift card to a retailer and get up to 5% additional boost on the money.

I wouldn’t recommend using Smarty Pig as your emergency fund. I think you should have your emergency fund easily accessible to you at all times. After all, that’s why it’s called an emergency fund!

There are a few points I did not like: you can’t stop the transfer once you’ve started it, but you can change the funding source. <s>There is a $25 fee if you would prefer a check be mailed.</s> They have done away from the $25 fee for a check! I think this shows how wonderful the people are at Smarty Pig. They heard people didn’t like the $25 fee for the check, so they did away with it. Great job, Smarty Pig!

Otherwise, there are no monthly fees. I think Smarty Pig is a great idea for anyone who is trying to save for a goal. Give it a shot!

Posted under Economy, Loans, Make Money Online, Money

In today’s world where 43% of marriages end in divorce, it is important to make sure you’ve got your finances in order before you tie the knot. The number one cause for divorce today? Money.

Before you get married, there are a few steps you can take to make sure you are protecting yourself and your future spouse.

Consider having an attorney create a pre nuptial agreement.

 A pre-nuptial agreement is a contract entered into by the two people getting married. The main purpose of the pre-nuptial agreement is the division of the assets in the event of a divorce. Call it marriage insurance if you will.

Try handling a joint account together before you get married.

Before my husband and I got married, we kept our separate checking accounts, but started a joint account for bills. At the time, we were making almost the same amount of money, so we’d each contribute the same amount to cover the bills. When rent or the electric bill came due, we would write the check out of that account. It was a good test on how we wanted to handle our finances once we got married and we still had our own separate funds.

Consider setting up an account with a mortgage broker that will allow your wedding guests to make deposits into an account for a down payment on a home.

I first heard of it last year and loved the idea.  I know the mortgage company that we got our mortgage through offered this type of program.

Talk about who is going to be in charge of paying bills, how much you are going to save, and if you are going to consolidate any bills once you are married. I know in my household it works if I am in charge of paying bills.

I like to know how much money we have and where it’s going. I also contribute 6% of my pay into my 401K and then I put 20% of my paycheck directly into savings. Since mine and my husband’s salaries are pretty close, it ends up being around 10% of our total income being saved.

Getting married is stressful enough, so eliminating one obstacle and possibly preventing problems in the future is a great idea. Sit down, talk about it, and I’m sure it will be a great foundation to a happy marriage.

Posted under 401k, Marriage, Money, Save Your Money

It’s no secret that since the economy took the plunge banks have started tightening up on their lending standards. Many people are excited about lower rates, but just exactly how many of them can get approved for a loan in this economy?

In February of this year, many banks were still lending at 100% loan to value (LTV). Basically what this means is that they would allow you to tap into more equity in your home, but it would cost you a higher rate than if you went with the standard 89.9% LTV.

For example, if your house is worth $300,000, and you don’t owe anything on it, before you would have the possibility of a Home Equity Line of Credit or a Home Equity Loan of $300,000 if you wanted to go 100% LTV. Today, the most you could borrow out of your home’s equity would be $269,700, which is 89.9% of $300,000.

The reason banks are doing this? To cover their assets. I know many banks went crazy lending money to anyone who wanted it about 1-2 years ago. Now they are seeing the repercussions of this in today’s economy. Banks were lending too much money and consumers just couldn’t handle it. Here came the foreclosures.

If you were to go into the bank today and ask about home equity lending, you would probably be asked a couple questions: how much do you think your home is worth, and what is the total amount of any mortgages on the property? From there, the banker would tell you what amount you could get financing up to.

Banks are using the same lending procedures for auto loans, unsecured loans, and lines of credit. If you don’t have good credit and a good income, you’re probably not going to get approved. Use common sense when you are applying for any type of loan. Make sure you ask questions first before you sign. If you have any questions about lending, I’d be happy to help!

Posted under Bank Secrets, Loans