Here’s the catch: to get into this program, it’ll cost you. I examined several money merge account options online and the rates varied from $1,800 to $4,500, with the average coming in around $3,000 to get started. This is added to the principal of the loan.

In other words, the fee adds about $20 to each minimum payment over the life of a loan, and in the accelerated calculation means that you’ll make almost exactly another month’s worth of payment - it will take you 13 years and 3 months to pay it off.

On the other hand, you could theoretically do it yourself. Start using a high-interest checking account (like Electric Orange, which gives you 4% interest) and then send every cent you can to the mortgage payment. Going back to the earlier scenario, if you always kept $1,000 in there as a buffer, got paid your $3,500 at the start of the month, spent $1,200 throughout the month, then sent off everything down to $1,000 at the end of the month to your lender, you would pay an average of $813 extra each month (that extra $13 comes from interest on the checking account). Given those numbers, you could pay off the mortgage in just barely over 13 years (the final payment is a tiny one).

Although that seems like a better financial deal than a money merge account (and it is), it has one huge risk: you. As we’ve discussed before, individuals are a huge risk because of their desire to spend money that’s “just sitting there” in an account. It wouldn’t take much at all over thirteen years for you to take money that’s already yours and spend it on something else.

One psychological advantage of a money merge account is that it encourages frugality. Why? It puts you in a situation where every dollar you spend basically goes onto your mortgage principal. See that bag of chips at the store? Is it worth it going onto your mortgage? You can use your own home as a psychological tool to be thrifty - and thus get out of the mortgage sooner.

If you have a lot of financial discipline, doing it yourself is a better deal than a money merge account. However, if you’re prone to spending extra at all and have found yourself saying, “Well, I have plenty extra right now, so I can afford it,” then a money merge account is probably the fastest way available to you to pay off your mortgage.

1. Not starting out early on. Numerous folks do not begin their investing while they're young because they think that they have a heap of time ahead of them. This is a gigantic fault. Because of the great power of compound interest, they're losing hundreds of thousands of dollars.
2. Accepting uninvited investment leads. At times, you will get a junk e-mail email or a telemarketing phone call offering investment advice. Don't take it. They're trying to drive up the prices of certain stocks in order to turn a profit. Do your own research or contact your financial consultant.
3. Not understanding that there are hazards. Just because something is believed a "safer" investment, does not signify that there Is not a chance that you could turn a loss.
4. Being late to purchase. You would like to purchase a stock as its price is getting higher. If you're too late, you will buy it just when it is beginning to decline.
5. Not going over your portfolio. Although it is a great idea to automatically invest a percentage of your payroll check every month, you should frequently reexamine your portfolio to look for any errors and make certain that things are acting the way that you desire them to.
6. Not having a plan. Safe investing commands a worthy plan. You had better know your risk levels and what your goals are and commit in ways that show that.
7. Not branching out. You should reach to construct a well-balanced portfolio. You do not want to place all of your eggs in one basket.
8. Altering their portfolio frequently. A lot of folks find it stimulating to buy and sell their stocks. It is addictive. All addictions come with a cost though, and you are paying a lot of cash for for each one of those transactions.
9. Yielding to scare or excitement. You should not always sell just because other folks are trading or purchase merely because other people are buying.
10. Not taking part in your company's 401-k plan. Numerous companies volunteer to match your 401k investments. If you are not active, then you're handing away free money.
11. Trying to find shortcuts. Correct investment should be for the long term. Taking shortcuts seldom pays off.
12. Keeping losers and trading winners. Many make the error of keeping a suffering stock because they're waiting for it to go back to the point that they purchased it for. Other people could sell their stock too soon, only to discover that the price went along to gain well past what they sold it for.
13. Following the recommendations in the media. By the time that an expert is discussing an investment on television, it is already going by its peak.
14. Investing in single stocks without financial knowledge. Whenever you do not know a good deal about investing or how to decide whether a stock is a beneficial purchase, you had better adhere to mutual funds.
15. Falling for get-rich-quick systems. There's no easy way to earn income. Get-rich-quick schemes are seldom all they allege they are.
16. Being over-invested in a company. A few people become over-invested in the company that they are employed. You had better strive to get a balanced portfolio.
17. Abiding by your emotions. Your emotions can induce you to make errors. Investing should be something that's accomplished with your brain.
18. Taking early withdrawals from your 401-k plan. 401ks are supposed to be a retirement program. There are sizeable penalties for drawing your money too soon.
19. Not saving enough. A lot of people just do not keep enough money. You should be sure that you are saving up enough cash at present to accomplish your long-term goals.
    

If you are able to fend off these huge investing mistakes, then you're more likely to be fortunate with your investing.

But you knew that.

It’s common financial advice, actually, but what’s not so common is how to actually do it. Obviously those who haven’t saved up an emergency fund have a difficult time saving money, even if they know they should.

So today we’ll look at some strategies for building up an emergency fund, for those of us who don’t have it so easy.

Why It’s So Critical

I don’t like to use the word “critical” often, because it’s often an exaggeration. But in this case, when we’re talking about the health of your finances, an emergency fund is definitely critical.

If you are having financial problems, the most important steps you can take immediately are 1) reduce your spending by being more frugal; 2) stop getting into debt; and 3) build an emergency fund of $1,000 (and later you can increase that to the standard 3-6 months of income).

Here are a few reasons an emergency fund is critical to your financial health:

1. Stop getting into debt. When an emergency comes up, if you don’t have an emergency fund, the first thing that will be cut from your budget is your debt repayment. You’ll use your credit card to pay for the emergency, and then you’re deeper in the hole. An emergency fund stops the need to use credit to pay for emergency expenses.
2. Smooth out your budget. If unexpected things come up, you don’t have to continually re-factor your budget to pay for these things. With an emergency fund, it makes budgeting much easier.
3. Prevent late fees. If you are living paycheck-to-paycheck, you will come up with times when you have to pay a bill late, or overdraw your bank account. With an emergency cushion, you avoid these financial hits.
4. Get ahead. If you can get a month ahead, your financial stress will drop way down. Instead of always playing catch-up, you can pay your bills ahead of time and sit back and relax.

21 Strategies for Creating an Emergency Fund

If you have trouble saving, it’s not enough to tell you how important it is to have an emergency fund. You need some strategies for doing it.

Please note that you should choose the strategies that work best for you, and perhaps combine some of them if that works better.

1. Start small. If you don’t have much to save, it doesn’t matter — the important thing is just to start. Even if it’s only $25 per paycheck, just start. It will slowly grow each paycheck, and you will be glad to see at least a little in your savings, and will soon be motivate to try to save more.
2. Automatic deduction. This is common advice, but that’s because it works. Set up an online savings account (such as ING Direct or Emigrant Direct) and have it automatically deduct an amount each payday. If you don’t have to think about it, saving will be much easier.
3. Payroll deduction. If you have discipline problems, there are accounts where you can have the amount deducted directly from your paycheck, before it’s deposited into your checking account (or before your employer cuts the paycheck).
4. Treat it as a bill. Every payday, you have a list of bills to pay before you can spend any of your money on variable expenses such as gas, groceries or eating out. Well, add your emergency fund contribution to your list of bills, and pay it at the same time. This makes it non-negotiable, and then what’s left over is what you can spend on other stuff.
5. Reduce an expense, save it. Take a look at how you’re spending money now, and find some things that can be cut back. Magazine purchases, gourmet coffee, comic books, cable TV, gizmos and gadgets. Whatever you decide to cut back on, take that same amount and put it directly into savings each paycheck. Don’t spend it.
6. Round up. I got this tip from J.D. Roth of Get Rich Slowly … actually, it’s a strategy used by his wife, who will log every purchase or check she writes into her checkbook or finance software — but rounds up to the nearest dollar. So if she spends $26.01, she enters it as $27. Over the course of a month, this can add up to decent savings.
7. Double purpose account. This tip is from Trent of The Simple Dollar, who wanted to pay down his debts but still have the financial security of an emergency fund at the same time. So Trent brilliantly used a double-purpose account: he would save money in an account, and after he reached a certain minimum, anything above that amount was being saved to pay off a specific debt. So let’s say the minimum amount is $500. After you pass $500, the money being saved is for a $200 debt (for example). Once you reach $700 in your savings account, you can pay off the $200 debt completely. Repeat the process for each debt.
8. Tip yourself. If you go to a restaurant and tip a waiter 15 or 20 percent, for example, match that tip for yourself. So if your tip is $10, tip yourself $10 as well … and put that directly in savings.
9. Keep paying debt, but to yourself. If you finish making a car payment, or paying off a credit card or smaller debt, take the amount you were paying to that debt and put it directly in savings each month. You won’t feel a difference in your budget.
10. Budget big for groceries, then save the difference. Let’s say you normally spend between $320 and $375 on groceries. Budget $400 for groceries, and whatever you don’t spend of that $400, put it in savings.
11. Quit smoking or drinking. Well, I wouldn’t bet my emergency fund on quitting one of these two addictions, but if you do quit, you should take the amount you were spending (and that’s a considerable amount, I know) and put it into savings. For me, I spent more than $5 a day on smoking — and when I quit in November 2005, it freed up $150 a month for savings.
12. Limit your access. If you are tempted to spend your savings, you should put it in an account that is hard to get to. Put your savings in a money market account or fund, and when it reaches a certain amount, roll it over into a CD or Treasury bond. You might not make as much on a CD, for example, but the point is that it’s hard to access and requires less discipline.
13. Stash a bonus or tax refund. If you get a Christmas bonus, or a tax refund, or some other such windfall, put that directly in the bank and don’t spend it. Use it for your emergency fund. Now start paying off your debt.
14. Save your change. Don’t spend any coins you get. When you get home at the end of the day, empty out your pockets into a jar, and once a month, go to the bank and put it into savings. This can add up faster than you think.
15. Save dollar bills. Similar to the above strategy, get your cash in $20 bills, or $10s or $5s. Don’t carry $1 bills. When you get $1 bills as change, don’t spend them. When you get home, put those $1 bills in an envelope, and save them.
16. Refinance. Refinancing your mortgage or auto loan can save you a lot of money. Take the amount you save and put it in savings.
17. Sell your car. If you have two cars, see if you can live without one of them. That’s what my wife and I do, and it works out fine, even with six kids. Take the amount you were paying on the second car and save it. Or, alternatively, sell your car and buy a cheaper used model. Save the difference in the payments.
18. Cut out dessert. If you’re trying to lose weight, don’t order the dessert or junk food you would normally order. Instead, put the amount you would have spent in an envelope and save it.
19. Stay in. Instead of going to the movies or eating out, cook your own meals and watch a DVD — or do something fun for free. Save the difference.
20. Freelance. Take your skills and market them as a freelancer, or get a second job on the side. Take the extra income and bank it. This was one of my strategies, and it works great.
21. Save on auto insurance. If you can switch to liability insurance, you might be able to save hundreds of dollars. Take the extra amount you would have paid for insurance and save it.

Credit checks are done by lending institutions such as credit card companies and banks on individuals who wish to apply for a loan or any form of credit. In addition, credit checks could also be done by a homeowner whether an individual would be a good tenant or not, as reflected by his or her past credit performance. Insurance firms also run credit checks on individuals who wish to avail of their insurance policies.

You can obtain your credit report containing credit-related information from any of the three major credit-reporting agencies. Furthermore, you can obtain your personal credit reports for free as stated in the FCRA or the Fair Credit Reporting Act. Under this Act, every individual is entitled to receive a free credit report from any of the three major credit-reporting companies in the United States once a year - Experian , Equifax , and Trans Union . Your free credit report contain your personal information (such as your name and address), how you paid your past and previous bills, and any delinquencies you have committed such as late payments as well as if you have filed for bankruptcy.

To obtain your free credit report, you need to fill up the required form through a centralized credit report website on any of the three major credit bureaus in the United States. You will be required to provide some basic information, which includes your name, permanent address, your social security number, and your birth date. Your credit report is important in securing yourself against any attempts of identity theft such as credit cards misuse and other forms of fraud. In addition, you must update your credit report regularly as lending institutions would be using such reports to determine if you are worthy enough to be awarded with the loan you have applied for.

After you received your free credit report, you should read each section carefully. All aspects must be included in computing your credit score. So make sure you have paid attention to all of them. Check your report for any discrepancies and make sure that you have not missed any payments at all. Your credit report also comes with the list of individuals or business entities that you have requested credit information from. You may also check to see if such names or entities are familiar with you.

Your free credit report would be used in running a credit check to you when applying for a loan or any other forms of credit. Thus, make sure that it is free of discrepancies or erroneous entries. Keep in mind that this report will reflect your credit performance - ensure that you do not stumble anywhere so that your loan application would always be a success.

Resources Mentioned in This Article:

• Experian
• Equifax
• Trans Union