Personal Finance Tips

Scottrade Review – Online Discount Broker Ratings

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Scottrade Review


Overall Scottrade Rating

Rating of four and a half stars


Summary

Scottrade strikes a good balance between quality and value. They have the most physical branches than anyone else online. This gives them an edge with customer service and convenience. With their online set of tools Scottrade is one of the best brokers around. Scottrades biggest downside is that they are more expensive than other brokers with comparable service.


Fees & Pricing

Scottrade is slightly more expensive than other discount brokers. Any additional fees are kept to a minimum and many costs found in more expensive brokers don’t exist. Most notably is their no fee IRA, no fee for inactiviy, and no minimum balance. Their no

Stock Trade (limit and market) : $7.00
Broker Assisted Trade: $27
Options $7.00 + $1.25 per contract

Mutual Funds (No Load, No Fee): Free
Mutual Funds (No Load): $17

IRA Fees: None
Inactivity Fee: None
Closing Fee: None

Minimum Initial Deposit: $500


Investment Products

Scottrade offers a full range of investment products including: stocks, options, mutual funds, IRAs, ETF, and ESAs. Their fixed income products include: US Treasuries, bonds, and CDs.


Tools and Resources

Scottrade has led the pack in real-time, up to the minute, reporting tools. They continue to push the envelope with their ScottradeElite trading platform (but you need $25K to access it). All of their tools have ample video tutorials and documentation to help first time users get started. Their web trading platform is also quite nice with fully customizable columns, reports, and charts.

In addition to software they also provide free access to Dow Jones News.


Scottrade Cons

Scottrade’s network of brokers is a good thing and a bad thing. It’s good because you can talk to a real person very quickly. It’s bad because they want you to use that instead of resolving many problems through email. They have also made parts of their online program lazy because of the dependence on these branches. To get your money into and out of Scottrade is a real pain. With no electronic transfer to and from a bank account you need to send your money to a Scottrade office for processing. To get your money out you need to request a check. With electronic transfers it cuts the time to a third of what you’d expect at Scottrade. UPDATE: Scottrade now accepts and supports ACH deposits and withdrawls. There was a time they didn’t have this option.

No automatic dividend reinvestment (DRIP) is kind of a downside too. If you invest heavily in dividend stock and like reinvesting the dividends Scottrade might not be for you.

For more advanced trading Scottrade’s system and customer support can be lacking. If you are an experienced trader executing non-traditional trades Scottrade might not be equip to help you much. If, on the other hand, you are a executing standard trades they will work great for you.


Scottrade Summary

Scottrade offers a competitive investment service and at $7.00 a trade they are hard to beat. The biggest complaint with Scottrade is that they don’t serve the more sophisticated or advanced trader very well. But for 95% of active traders Scottrade is one of the best options around. I still prefer TradeKing or Zecco because they provide the same level of service with less commissions. With that aside they provide a great value and offer a wide range of investment vehicles.

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Tips for Shopping Online

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Internet Shopping Tips
Shopping online can save you a bundle. Information and products are at your fingertips. Internet retailers need to be extremely price conscious to stay competitive. When companies compete the consumer wins. These tips will help you get the best deal and have a safe experience.


Look for security

There is a quick way to find out if a site is secure. Look for HTTPS:// instead of HTTP:// in areas of the website where you are entering sensitive financial information. It is common for most websites to switch to their secure pages only when nessicary. You usually won’t see https:// until you’re in the checkout area. If you are entering your credit card information always check before proceeding. If there is no https your information can be easily stolen. When a page is secure it encrypts the data going to and from that page. So even if your data was intercepted it could not be read.

Look for https in the address bar and a lock to verify website security
Look for https and the little lock

If you are entering your credit card information make sure the page is secure. If the page is not secure your information can be easily stolen. Secure pages encrypt data going to and from pages.


Compare Prices

Comparing prices on websites isn’t as easy at might first appear (especially if your searching for a non-standardized item). The first step is to narrow your search to exactly what you want. Find a part # or a model # and search for it in a comparison shopping engine. I prefer Google Products but there are others as well. They have an incentive to place higher paying vendors near the top of the list and their products seem to be less organized.

Avoid the lowest priced vendor (unless you’ve bought from them before). Most of the time they will require that you buy the warranty, a bunch of accessories, and join some mailing list to get the “lowest price”.


Have the deals come to you

Using RSS feeds and some basic filters you can have deals come to you when they are ripe for the picking. Automatic deal finders using RSS is an easy way to get low cost gifts and surprizes for yourself. You will need to be patient but the wait is usually well worth it. Hot items like the Nintendo Wii won’t likely drop in price but just about everything else goes on sale periodically.

If you don’t mind buying used you can also set up a way to search through Craiglists for misplaced bargins. Many times people will post items you want in strange categories or forget to write a good desciptoin. Other bargin shoppers will miss those deals and you’ll have the item delivered to your feed reader.


Look through deal websites

Finding a deal website with up to date offers is a good way to browse for things like laptops, HDTVs, cameras, or other everyday electronic items. All of my laptops and computers come from sites like this because they usually offer more power and features for much less.


Keep all your records

Keep records of your reciept page, the items ordered, and what credit card you used. If you want to return an item or dispute a charge you’ll need all the information you can. Most merchants make it easy to return or cancel an order. For infrequent purchases it’s best to have a folder in your email labeled ‘shopping receipts’ to stay organized. If you buy from individual stores, through Amazon or Half.com, keeping these reciepts will be cruitial.

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TradeKing Review – Online Broker Ratings

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TradeKing Online Stock Trading Review


Overall TradeKing Rating

Five star rating


Summary

TradeKing offers the most competitive package compared to all the other online discount brokers. TradeKing’s interface is straight forward and easy to use. I’ve been using them for a few years now and their service is amoung the best I’ve tried visa vis Zecco, Scottrade, Sharebuilder. If you are looking to make a lot of trades their $4.95 fee per trade is unbeatable. They are also friendly to the beginner trader with $4.95 broker assisted trades, no inactivity fees, and top notch research tools.

I would recommend TradeKing to anyone getting into the market for the first time, seasoned traders, IRA account holders, option and day trader If you look around I’m sure you’ll agree that TradeKing has earned all five stars.


Pricing & Fees


It should be noted here that TradeKing offers it’s lowest rates to everyone. There is no need to sign up for a special program or make a certain number of trades a year. If you make 1,000 trades or 10 you will get the same low price.

Stock Trading (Market) $4.95
Stock Trading (Limit) $4.95
Broker Assisted Trade $4.95 (Lowest anywhere)
Option Contract $0.65 (Only Zecco beats them at $0.50)
Margin Rates ($0-$49,999) 6.50% ($50K-$249K) 5.50%

Mutual Funds No Load Purchase/Sale $14.95

Bonds $4.95 per bond
Treasuries $24.95 per transaction

Certificates of Deposit (CDs) $24.95 per transaction

Inactivity fee: None
IRA annual fee: None

No Minimum Balance


Stand Out Features

Check Writing – Write checks directly from your account. This is a newer feature that most top end brokers offered to their clients.

Education – Tradeking is one of the best online brokers for education. Free seminars, tutorials, and tons of other material make this a broker you can learn a lot from.

Options – In the last few years TradeKing has really made options trading a bigger part of their business. They have the second bet pricing structure online. (OptionsHouse is the low cost leader).

Customer service – Tradeking has some of the best customer service anywhere online.

Great for beginners – Their software and approach is user friendly and new users won’t be overwhelmed by the complexity other companies may reveal. Don’t let this fool you, Tradeking is can still provide advanced trading features.

Graphs – They offer ‘risk’ graphs with each of their option trades so you understand a little better what to expect before you pull the trigger.


Tools & Resources

If in depth reports and research is your thing TradeKing has you covered. Their tools include: Options Pricing Calculator, Probability Calculator, Profit + Loss Calculator, Options and Strategy Scanners, Stock, ETF + Mutual Fund Screeners, Fixed Income, Maxit Tax Manager, AutoTrade, and Extra Hours Trading.

Education includes: Technical Analysis Education,Educational Videos and Webinars, Intelligence Reports, Live Events, & Webinar Instructions.

Research resources include: Market + Company Overview, Watchlists, Up to the second Quotes, Free MarketGrader research, Interactive Charts, Option Chains, Technical Analysis.

TradeKing also has a robust community of active traders that can help or give you ideas on trading.


Customer Service

TradeKings website is easy enough to use and navigate that finding answers is easy as pie. In case you need help you can access their award winning customer service through phone, chat, and email. When I had a question on my account they answered my email within five minutes. The wait time on the phone is less than a minute on most days.

Best of all you can talk to an actual broker and if you need to execute a trade it’s still only $4.95


How do they compare?

If you are an old person that likes names like Vanguard or Charles Schwab then I can understand that. But paying 3 to 4 times more for the exact same service? There is no reason for that. In these troubled times our stock portfolio is already taking a hit. Paying all the fees and extra padding other brokers stack on doesn’t make much sense.

If you are going for the bear bones best price, Zecco is for you. If you want something in the middle between discount and full service broker TradeKing and Scottrade are great. If you are wanting more specialized option trading I would suggest optionsXpress.

TradeKing Online Stock Trading Review
Visit TradeKing

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Inflation in America – What will hyperinflation look like?

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Inferior economic thinkers have dominated American politics for the last 100 years. Short-cuts, cheap debt, and market manipulating policies will collapse the US monetary system. Almost all economists and politicians in power are Keynesian economists. They believe the free market is chaotic, illogical, and inefficient. They believe they are smarter than the market. They believe they can prevent the cycles of boom and bust. The founder of this type of economic thinking is John Maynard Keynes. He famously proclaimed “We will not have any more crashes in our time.” in 1927 (years before the Great Depression).

The result of these Keynesian policies is inflation. Inflation is a tool used to transfer wealth from producers to worthless bureaucrats and their pet projects. As the government becomes more desperate for cash, they will increase the flow of paper money (fiat currency) until the entire financial system becomes insoluble. As the American dollar weakens, foreign countries will sell their bonds and flood the market with devalued currency. You can expect inflation like the U.S. has never experienced. The cost of items will skyrocket and your wages will stay the same. Those in power will blame the free market and capitalism but the real cause of the fall will be their failed economic policies.


Hyperinflation In Germany


German Children Playing With Money
German Children Playing With Money

Children stacking devalued dollars.

woman burning paper money for heat
Woman Burning Paper Money for Heat

Wheelbarrow of Worthless Money
Wheelbarrow of Worthless Money

Sweeping paper money from the streets
Sweeping paper money from the streets in Hungary


Making a fort is fun!

Woman burning worthless cash in stove
Woman burning cash in stove to cook with.

Recent Inflation in Zimbabwe Africa

Zimbabwe Hyper Inflation
Man carrying arm loads of cash


Starving billionaires.

Paper dollars toilet paper
Zimbabwe Paper Money Used as Toilet Paper

Hyper Inflation in the USA (what it might look like)

Man holding newly printed cash.
The amount of cash injected to save the country has a real possibility of destablizing the US currency and increases the chance of total collapse.

Burning $100 dollar bills.


Buying food could be very difficult with hyperinflation.

List of countries which experienced hyperinflation

Angola 1991-1995

Argentina 1975-1991

Austria 1921-1922

Belarus 1994-2002

Bolivia 1984-1986

Bosnia-Herzegovina 1992-1993

Brazil 1986-1994

Bulgaria 1996

Chile 1971-1973

China 1948-1949

Free City of Danzig 1922-1923

Georgia 1993-1995

Germany 1922-1923

Greece 1942-1944

Hungary 1945-1946

Israel 1970-1971

Japan 1948-1951

Krajina 1992-1993

Madagascar 2004-2005

Mozambique 1977-1992

Nicaragua 1987-1990

Peru 1988-1990

Philippines 1942-1944

Poland 1989-1991

Romania 1998-2005

Russia 1921-1922 and 1992-1999

Turkey 1990-1995

Ukraine 1993-1995

United States 1861-1865

Yugoslavia 1989-1994

Zaire 1989-1996

Zimbabwe 2004-2009

With fiat money there is almost a guarantee of hyperinflation given enough time. To defend yourself buy things with intrinsic value (e.g. food, shelter, gold, silver, land). Things with inherent worth will always be worth something. The same can’t be said for paper money.


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Compare Prices on Websites – Best Stores, Items, Ratings, & Specs

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Look & Compare before you buy.

Price shopping online is an important step to get the best price on new purchases. Finding the lowest price from a dependable website is critical. How do you find trusted items, ratings, and specs?

Narrow your search down to a specific item

If your want to compare prices you need to find the exact product you want. Say your looking for an MP3 player. If you try to compare the prices on the generic term ‘MP3 Player’ you’ll have a hard time pinning down the exact price. Instead, try to find the exact make, model, and brand of MP3 player. You’ll have much more luck knowing you want a 8 GB ipod touch then using a generic search for an MP3 player. This same principle works on all levels, even shopping and negotiating for a new car.

Comparing Ratings & Specs

Once you have your exact product name and description it’s time to read some reviews. When comparing reviews it’s best to have a couple products you want to compare. It might also be good to compare a similar product with differing features. There are a few websites I depend on for ratings and specs. Amazon, NewEgg, and the Manufacturer website are all good resources. You’ll soon find that some reviews and ratings are intelligent and others are…not. Some users will give a vacuum a bad rating because it’s not a toaster. It pays off to dig deeper and see why a product has a good or bad rating. As the number of reviews on a product increase the likely hood of poor reviews unduly effecting the rating is unlikely.

Another quick and dirty way to compare ratings is to simply type your products in a search engine. Your search query might read something like “product I v.s. product II”. There are a lot of websites dedicated to answering your questions.

Search on comparison shopping engines

Once you have your specific product type your search into a comparison shopping engine. In some cases you’ll see the prices here are much less then what you could find any where else.

Google Products (that’s what they’re calling it now-a-days) is great resource. They include tax, shipping, and final cost. The products here are listed free and Google doesn’t make any money off how they display the results. Other comparison shopping engines charge for placement and might not have as many stores as you’d like to see.

Comparing the Best Stores & Prices

WARNING! Buying from a store with the lowest price can be extremely risky. As a general rule anything under 20% should be suspected as potential fraud. The exceptions to this is when the product is refurbished or used. When buying a new digital camera I nearly bought from one of these companies. Luckily I talked with my friend (who’s a great photographer) and he convinced me otherwise. Within 30 seconds of research we found tons of people who got scammed. If you’re tempted to go with the lowest price take the time to research. You’ll be happy you did!

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Identity Theft Statistics & Facts

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Man without a face - stealing identity
Identity theft is a substantial risk in today’s world. Millions of people are effected every year. These statistics and facts will help you understand how big a risk it is and where the threat is the greatest. Hopefully you will be able to avoid potential identity theft from happening to you.

Who are victims of identity theft?

  • In the United States 4-5% of the population are victims each year.
  • 16% of identity thieves are known personally by the victim. Friends, family, relatives, neighbors, make up 16% of all cases.
  • 56% of victims have no idea how their ID was stolen
  • Victims are rich and poor, old and young. No one is immune from identity theft.

What types of identity theft are there?

  • 37% of victims are credit card victims
  • 39.5% of people are non-credit card account victims
  • The remaining 23.5% of people have had new accounts or applications created using their information

What is the worst kind of theft?

  • The opening of new accounts is the worst type of identity theft. Costing an average of $1,350.
  • Opening of new accounts can take up to 6 months before anything is discovered. As compared with one week on existing accounts.
  • Victims that had new accounts opened suffered additional problems beyond the cost of recovering their identity (see below).

What is the “best” kind of theft?

  • Existing accounts are not as bad as new account creation, with only $500 in stolen money on average.
  • Victims of existing accounts noticed the problem within a week on average.

How much does it cost to fix?

  • Theives steal an average of $500, 50% time
  • They can steal up to $6,000 ten percent of the time.
  • Half of people involved had to spend nothing to fix the problem.
  • Ten percent had to spend $1,200 or more to recover their losses and their identity
  • The median time to fix the problem was 4 hours for most victims
  • The most severe cases (only 5% of people) spend 130 hours to fix the identity theft problem.

What additional problems might a victim encounter?

Beyond fixing the immediate problem of having their identity stolen. 37% of all victims also encounter:

  • Harassment from bill collectors
  • Denial of new credit applications
  • A lower credit score
  • Existing credit cards being shut down or denied
  • Inability to get new loans
  • Having utilities shut off
  • Being part of criminal investigations
  • Being sued in civil suits
  • Denied new banking accounts
  • Insurance rates increase

Those victims that had new accounts created are 200% more likely to have these things happen to them. Those that had problems with existing accounts were half as likely to experience any of this.

Top States for Identity Theft

Victims Per 100,000 Population

Arizona 1427
Nevada 120
California 113
Texas 110
Florida 98
Colorado 92
Georgia 86
New York 85
Washington 83
New Mexico 82

What do ID thieves do most often when they open new accounts?

56% Buy goods and services
8% open new phone account
7% open new credit card accounts
3% get medical supplies & treatments
1% rental applications
1% obtain government benefits
1% Apply for a new job

Summary

Having your identity stolen to open new accounts is by far the worst type of identity theft. Monitor your credit history closely and try to catch things before they get really bad. The worst way to find out you’ve had your identity stolen is when you apply for a new loan or job.

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Citibank Scammed By Nigerians – Tries dozens of times to send $27 Million

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A huge bank, Citibank, has been duped by a Nigerian scam. Citibank tried dozens of times to get the money to the Nigerian scammer’s bank accounts. The scheme fell apart when the receiving banks couldn’t complete the transfer. The package the documents came in were post marked coming from Nigeria (not Ethiopia like the scammer claimed).

When Citibank can be tricked it makes the general public seem like easy picking. If a deal seems too good to be true, it probably is.

Read More

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How to Get Rid of Credit Card Debt

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Credit Cards
Getting rid of credit card debt is both rewarding and challenging at the same time. I know from experience that getting into debt is much easier than getting out. Most of the debt I’ve put on credit cards has been a result of home improvements. We bought a fixer upper home and decided that using credit cards would be the easiest way to finance the needed improvements. We are getting a handle on our credit card debt but it feels like an uphill battle all the way.

Call for a lower interest rate

If you have never called your credit card companies you might give it a try. If you have been a good customer with no late payments you’ll have some negotiating power when you call. If you haven’t maxed out your credit card you will get better results as well. When you call tell your credit card company inform them that you’ve been getting offers in the mail with better interest rates. You can also mention that you’re thinking about using a balance transfer card to lower your payments. Ask them what they can do for you in terms of lowering your rate and increasing your credit limit. Lowering your interest rate can help your payback time considerably. A higher credit limit that is not in use will improve your credit score for the next time you call.

Rapid Payoff Schedule

Setting up a payoff schedule that works with your budget will have your debts paid off in no time. Don’t shoot for the moon when you set this up. Instead, try something that is doable. The $100 used in this example can change depending on your debt. You want to avoid making the ‘minimum payment’ on each of your cards. Try to be the most aggressive with the highest interest card on the top of the list.

1st phase of payments
A – 14% account – $100
B – 12% account – $100
C – 11% account – $100
D – 9% account – $100
E – 8% account – $100

First order your debts from the highest interest to the lowest. Set up a flat (or consistant) payment you can make on each account every month.


2nd phase of payments
A – Paid off! – Now use this $100 for account B
B – $200
C – $100
D – $100
E – $100

After a set amount of time ‘Account A’ (the first account) will be paid off. Instead of taking that $100 back use it on Account B. You’ve already budgeted for it and it will speed up you payment schedule.

3rd phase of payments
A – Paid off!
B – Paid off!
C – $300
D – $100
E – $100

When you get to Account C you will be putting $300 towards it each month. Continue ‘stacking up’ your entire debt payments on each account until you don’t have any more credit card debt.

Switch to an All Cash Life Style

Switching to cash is the best way to avoid any credit card traps into the future. It forces you to start saving for large purchases and frees up a lot of wasted money you’d pay in interest. At 22% you’d spend $2,200 a year in interest payments just maintaining $10,000 of debt. Can you image what you could do with an extra $2,200 every year? Switching to cash and paying off your credit cards will help you put this money back in your pocket.

I don’t believe in freezing your cards. If you’ve had real problems with credit cards shred ‘em! Paying off credit cards is very rewarding; psychologically and monetarily.

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Credit Card Debt and Bankruptcy – Will they be discharged?

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Credit Card Discharged Debt

If your credit card and other debts are too great, you might be considering bankruptcy. It would be advisable to brush up on bankruptcy law as it relates to your situation. In brief, the laws have gotten much stricter. Those filing bankruptcy are having to pay back bigger portions of their their debt. There are even times when creditors break the law by illegally collecting discharged debt.

In addition to those problems credit card companies are seeking a “nondischargeability action” in many cases. They are trying to make your credit card debt something that can’t be wiped away. Even after the bankruptcy the “nonchargeable” debt will still need to be paid back. There are two ways banks can get this 1) The application was fraudlent 2) They prove you used the card without an intent to pay. These new rules apply to both chapter 7 and 13 bankruptcy.

Red Flags

There are a number of ‘red flags’ the indicate you didn’t intend on paying the debt back. If any of these happened there is a good chance the judge will rule in favor of the credit card issuer. Most of these rely heavily on the timing of how you used the card and how you proceeded with your bankruptcy.

  • New additional credit card debt shortly before filing
  • Many new credit cards and applications for more cards
  • Pulling out large amounts of cash from your credit cards
  • Going on a dream vacation before you filed bankruptcy
  • Moving debt from one card to another as a way to make payments
  • Going over your credit limit frequently
  • Having all your cards maxed out at the time of filing
  • You’ve used your credit card after starting the filing process (e.g. paperwork, lawyers, notifications)

If at all possible avoid bankruptcy.

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How to Monitor Credit for FREE – Monitoring all 3 Credit Bureau Reports

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Monitor your Credit Score
Free Credit Report from Experian, Equifax, and TransUnion

Your are entitled to a free credit report from the government every year from each of the credit reporting bureaus. With three bureaus offering a free report yearly you can monitor your credit for free by spreading out the times you pull your credit.

This type of credit pull is referred to as a “soft pull” and will not effect your credit score.

How it works

This is an example of how you would space out getting your credit reports to monitor your credit.

  • January (01) – Pull your report from Experian
  • May (05) – Now, get your report for Equifax
  • September (09) – Last of all, get your report from TransUnion.
  • Next year – Start with Experian in January and repeat the process

Automatic Reminders

Because you can’t schedule the reports to be sent to you automatically it might be a good idea to have something to remind you. A service that I use regularly is LetterMeLater.com. You can schedule e-mail reminders scheduled to be delivered into the future. A reminder would say “It’s time to get your credit report from Equifax.” when May 1 arrives.

Where do I start?

You would start my visiting annualcreditreport.com. From their visit the bureau of choice and complete the process. You will see Experian, Equifax, and TransUnion.

Words of Warning

Take care not to get up-sold as you work through each of these bureaus. They they will try to offer you your credit score number and other upgrades. You do not need any of these to complete the process. Read carefully and try to avoid these tricks. By law you are entitled to one credit report a year.

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