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Buying or Renting: The Pros and Cons

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When you’re looking for a home through real estate listings, Canada offers 2 basic options. You can either buy or rent. But which is the better option?

The truth is that the right or wrong answer will not be the same for everyone. It depends on your particular needs and situation, and only you can decide which option is better.

To help you understand, here are the core benefits and drawbacks of each option

Buying a Home PROs

  • The value of the home can increase over time so you may generate more profit when you sell compared to your interest earnings when you leave your money in a savings account.
  • As the home is your legal property, you’re able to use it as you see fit without a landlord limiting you. You can change the home style and renovate to suit your preferences and needs.
  • You can earn income immediately from the home by renting it out. You can then use the rental income towards paying off your mortgage.
  • If you use the property to generate income, you may enjoy some tax deductions.
  • When you make montage payments on time, you improve your credit score.
  • You can use the property as collateral when you borrow money.

Buying a Home CONs

  • You may not pay rent, but you need to pay the mortgage, the property taxes, the home insurance premiums, and the costs of maintenance. Add these expenses together and they can exceed rent by a huge margin. So you better earn enough money to cover them all.
  • It’s very possible that you don’t make profit on the home, especially when you resell very quickly. Real estate is an investment, and there’s no such thing as a sure investment especially for short-term profit.
  • You’re not able to move to another address as easily. You will have to sell your home first.

Renting a Home PROs

  • You’re a lot more mobile when it comes to your home location. It’s a lot easier to move to another apartment. So if you get a new job on the other side of town, you can just get a new apartment in that general area.
  • You’re also able to live in a place where the home prices are simply too much for you. This means you can enjoy the various restaurants, clubs, and services that the more affluent can enjoy.
  • Moving out is much easier for you, compared to how a homeowner needs to find a buyer for the home. You don’t have to find a replacement, as that’s the job of the landlord or property owner. If you signed a lease, you can always find someone to take over or you can even rent out the property.
  • Rent doesn’t cost as much as the expenses involved in home ownership. So you’re able to use your money as you see fit, as your budget is freer. You can put that money in stocks, or even invest it in real estate. Or you can be a renter for all time and you can enjoy life with your spending money.

Renting a Home CONs

  • Your lease or rental agreement limits how you can use or renovate your home. You will need to get the approval of the homeowner if you make any changes.
  • There is no wealth creation. Your rent is lost forever, as you can’t get it back. You don’t put that money in home equity.
  • The amount of rent you pay may increase every year, and you have no choice but to pay if you want to stay.
  • If you have a lease, you’re not sure of it will be renewed. So you have to be ready to move out if it isn’t.

So which set of pro’s and con’s appeals to your preferences and budget? As always, the choice of whether to buy or to rent is entirely up to you.

 

Expanding Your Personal Freedom By Getting a New Set of Wheels: 3 Ways to Finance a Car

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Buying a car requires you to make the right decisions. There are many options buying it outright or buying it on finance. In fact, buying a car is the second most expensive asset after your house. So, it is important to select the best way to buy a car. Don’t rush into making decisions because they’ll cost you in the long run. Instead, take your time and make sure you got the right decision. Below are three ways to finance your car without losing much.

1) Opting for a Shorter Loan and a Cheaper Car

Car dealers are very smart when it comes to persuading buyers to purchase a car. They will use all techniques to convince you into buying a car; not just a car, but an expensive car that will make you have to repay the car loan for a longer period of time.

Some car dealers will try to lure you with low monthly payments. Don’t accept that kind of deal because their main aim is to generate more interest from you. Instead, choose on a plan that will see you repay your car loan after a short time.

By opting for a shorter loan, you will be able to save more money on interest they would have charged you if you opted for the low monthly payment. Doing this will not only help you cut on cost, but also build equity in your car as fast as possible. It is therefore better to be very careful with the car dealers. Don’t let them fool you with their offers.

2) Don’t Finance a Car with a Bad-Credit Loan

You don’t have to lie low to car dealers simply because you have a bad credit score. Instead, find ways in which you can get approved before you start shopping around. Some companies always offer Auto loan. Be sure to check.

You need to first check your credit report to ascertain that everything is okay. There are sites where you can check your credit report for free. Just search the sites on Google and confirm that everything is okay.

Once you are certain with the nature of your credit report, you can go ahead and negotiate with the car dealer on fair grounds. It will prevent the car dealer from exploiting you or taking advantage of the bad credit score. So, go ahead and be sure your credit report is excellent before you start shopping around for the best car.

3) Finance Your Car with a Credit-Union Car Loan

Credit unions are different from banks in that they are member-owned, unlike the banks that are mandated to make profit for their shareholders. Always ensure you check your car loan eligibility before making any decision.

Therefore, you can be guaranteed that a credit union car loan will provide you with lower rates as compared to the banks. The only challenge is that you first have to be a member.

Some credit card unions have strict rules. For example, Wings Financial Union only accepts members who live in Saint Paul or Tacoma. Though some credit unions can allow you to qualify for their membership, regardless of your city or your place of work. You should be able to find that better.

Final Thoughts

Once you have the best possible car loan, make sure you are not exploited in any way by the car dealers; get the best deal that will not let you regret later. But make sure you follow the guidelines above to avoid any poor deal.

Whole Life Insurance vs. Term Life Insurance

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Determining whether to purchase a life insurance policy can be complicated, and the issue becomes even more confusing as you consider personal factors (such as family make-up and budget) and the different types of life insurance (whole life and term life.) As you assess your needs, you may wonder whether you need the coverage, which type is best for your situation, and how much insurance to get. Before starting, it’s important to understand the differences between and the pros and cons of both whole and term life insurance.

Whole Life Insurance

A whole life insurance policy provides protection for the rest of your life, as long as you’re still paying the premiums. If the policy is still effective when you die, your beneficiaries will receive a sum. This type of insurance is often chosen as an investment of the cash value. These plans usually consist of a death benefit, premium, cash value, and dividends. Most people consider buying whole life insurance when they want to provide money for funeral expenses, leave an inheritance, or save their family from estate taxes.

The Pros

  •          Coverage lasts until the age of 100 instead of 80 which is when term insurance expires.
  •          Your heirs won’t have to pay estate taxes or will have a reduced amount of taxes.
  •          Your loved ones can receive a tax-free payout at your death.
  •          As long as you pay premiums, their amount is fixed, and the death benefit is guaranteed.
  •          The policies build cash value and may be counted as an investment after other options have been maxed out.

The Cons

  •          The primary purpose of whole life insurance is not as an investment, so your returns are sure to be conservative.
  •          This type of life insurance tends to be most expensive.
  •          You may end up paying for coverage you never really need.
  •          The money in your policy doesn’t really belong to you; if you borrow from the policy, the withdrawal is treated like any other loan.

Term Life Insurance

The purpose of term life insurance is to give your family or beneficiaries a temporary financial resource if you pass away. This type of coverage offers a death benefit but doesn’t carry any cash value. The policies usually span a set amount of time, such as three or thirty years. The premium is affected by the age and health of the policyholder.

The Pros

  •          Term life insurance is very affordable, sometimes no more than a dollar or two a day.
  •          The coverage is easy to understand and rarely include an exam plan.
  •          This type of insurance can be converted to a whole life or universal life plan.
  •          Many add-ons are available for customized plans.

The Cons

  •          These Columbus life insurance policies will expire when their terms are up. The annual renewable term is much more expensive, and the cost continues to increase at that point.
  •          There’s no savings or investment option with this type of policy.

How to Choose

The best way to determine which type of Columbus life insurance is best for you and your loved ones is to talk over the options with an agent. Some customers begin with coverage they can afford and adapt their policies to meet changing needs. Which type of insurance coverage sounds best for your situation?

How to Finance a Car without the Stress and Expense

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Car-buying can be an intimidating endeavour for anyone, much less someone who has never dealt with financing. With the never-ending tales of being ripped off, or worse yet, being sold a lemon, no wonder consumers fear shopping for a car in a market where we can be sold on anything. From unscrupulous lenders who trick consumers into dubious financing contracts to lenders who charge excessively high interest rates, vehicle buyers have a lot to be concerned about.

However, shopping for a car does not have to include the stress and expense characterised by these purchases. In fact, by going into financing informed with the information needed to secure an appropriate loan you remove many of the hassles associated with car shopping. In addition, by having the requisite information handy, you can secure a loan that will land you a steal.

Keep reading to learn how you can alleviate the stress and expense of car-buying to make your next vehicle purchase as straightforward as possible.

Financing

Before shopping, peruse the various financing options available. Today, you can finance a car through a credit union, a bank or any financing company. However, by shopping around, you guarantee that you will secure the best possible rate. While traditional methods of financing are great, also check out alternative financing options. You can finance a car from Latitude Finance and be given rates that are just as competitive as conventional financing companies. By going into a financing office having already exhausted all avenues of financing, you can rest assured that you are securing the best loan for your budget.

Pre-Approval

Consider getting pre-approved for a loan before actually shopping for a car. This benefits you in a couple of ways. The first benefit of getting pre-approved for a loan is that you know exactly how much you have to spend, which is great in terms of limiting your choices. This also cuts down on the amount of time you would spend shopping for a car.

The second reason getting pre-approved is great is because it streamlines the car-buying process in that you have already applied for the loan and they have given you an amount you can reasonably spend. This translates into getting you out of the dealership a lot sooner than with other financing methods. For the most part, the pre-approval alleviates many of the stresses associated with car-buying.

Down Payment

In the distant past, before modern technology made financing so accessible to consumers, a phenomenon called the down payment made car-buying a less stressful task. Today, many zero down loans have made it affordable to purchase a vehicle. However, there is something to be said about having money set aside for a down payment.

A down payment can alleviate the stress of securing financing for a couple of reasons. For one, it allows you more purchasing power as it relates to the various types of vehicles you can purchase. Then, it also gives you some leverage as it relates to your overall interest rate and monthly payment. A down payment can drastically reduce the amount you pay to the financing company every month.

Budget  

Go into the car-shopping experience with a budget. Your budget sets the ceiling for how much you can actually afford on a monthly basis. Additionally, this budget will limit the vehicles you can actually afford to purchase, which saves you time in the long run. Things to consider when making a budget include monthly payment, insurance, maintenance and fuel costs. By going to the dealership with a budget, you alleviate the stress of knowing what you can actually afford.

Shop Without Fear And Intimidation

The biggest hurdle to stress-free car-buying is related to the financing and expense of purchasing a new vehicle. However, by taking a multi-pronged approach to this experience, even shopping for a car can be enjoyable as opposed to stressful, and worse yet, expensive. For the most part, a little preparation before shopping will alleviate any stress, and you can actually be enthused by your new purchase.

Learn From The Expert: Last Minute Tips On How To Cut Your Tax Bill

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Even though the deadline for filing 2017 self assessment returns online is long past (31 January 2018), it is never too late to get information that can help for subsequent ones. Of course, if you missed the deadline, you may have to pay a penalty, unless you have a really good excuse, such as a long stay in the hospital (with hospital records to back it up), but for subsequent tax filings, the following minute tips from personal finance experts will help you cut your tax bills in the future.

Cut your tax bill when you donate to charity –

If you are an additional or higher rate tax payer, you can legally cut down your tax bills by being charitable. You are essentially killing two birds with one stone. Donating for a good cause and slashing your tax bills. When you add up your charitable donations on your tax returns, you can claim tax relief. Mathematically, you can save 25p on every £1 charity donation. Not only can you earn tax relief from major charities, you can also lower your tax bills by sponsoring minor events like scouts or brownies at your children’s school. All in all, you get to save by giving.

ISAs –

If you are a basic taxpayer, you can earn as much as £1,000 interest on your personal savings without paying one penny in tax. The same thing applies to higher rate tax payers, you can earn up to £500 in interest without paying tax. However, you may need to check the tax certificate for your bank account. The same thing applies to investments. You are entitled to £5,000 a year in tax free dividends if you own any investments outside your pension or personal savings account, although this figure will reduce to £2,000 from April 2018. You can actually save up to £20,000 every year with an ISA without having to pay capital gains tax or income tax.

Better mortgage alternative –

The new property and mortgage rules that will take full effect within a few years will see landlords progressively lose valuable tax relief on their buy to let properties mortgage costs. Before the introduction of this new rule, landlords only have to declare rental income after they have paid mortgages, and this system help cut tax bills by thousands of pounds. But, since April 2017, the method of declaring rental income has changed; meaning a lot of landlord will be expecting significant increase in their tax bills. However, because mortgage rates have dropped in recent years, landlords may be able to make savings by exploring other mortgage opportunities. Additionally, landlords can talk to tax experts to ensure they are claiming all they can against their rental income.

Self employed allowable expenses –

If you are self employed, you can slash your tax bills by taking note of what is called allowable expenses. For every £1 you spend on ‘expenses incurred exclusively in the performance of your business’ you can get 20p back in your wallet. For example, if you work from home and have to travel to London for a business meeting, you can claim travel costs which can cover food and drinks. Unfortunately, the taxman will not appreciate 5 star restaurants in your fillings, but the odd meals and drinks can add up. The secret is to keep track of all these seemingly insignificant expenses. One way to do this is by ensuring you get a receipt every time you carry out these little trips.

Advice From Brennan & Clark Collection Agency – How to Avoid Falling Behind On Your Debt Repayments

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Debt is a affliction which many people are suffering under the weight of, not everyone of course, but there are many who are finding it difficult. Well managed debt is absolutely fine and will not cause any issues to you at all, poorly managed debt is a large problem however that affects many aspects of the life of those in financial difficulty. The key to staying on top of your debts, is to stay on top of your repayments, and we spoke to the Brennan & Clark collection agency, to give you some pointers on how to ensure that you are on top of your debt repayments.  

Review and Negotiate

The first step is to look at all of you debts, and the repayment amounts, and then cross reference that with your salary and the bills which you will have to pay each month. When reviewing your debts, you should also pay particular attention to the date on which the payment is required. After reviewing your repayment details, you can then speak with your creditors, to tweak the agreement somewhat. For example make sure that the date of repayment, is shortly after the date that you receive your wages, making the payments easier to make. If you have found that with all of you bills and repayments, you don’t have enough money to survive each month, speak with your creditors and try to make an agreement to pay less over a longer period of time.  

Prioritise

Debt repayments are something that you can’t forget about, or put off for another month, they are vital payments that must be made monthly. And so when you receive your salary, you ought to consider repayments in the same way that you would think about paying rent, or your gas bill. Make sure that you understand the importance of these repayments, and that you give them high priority to avoid falling behind.

Communicate

It is vital that any changes in your personal circumstances is known about by your creditors. It is up to you to notify your creditors of a change in salary, sudden unemployment, unexpected medical bills or any other situation which impacts your ability to repay your debts. Once you notify the creditors, in most cases you will find them more than happy to make alterations to your agreement with them, in order to keep your repayment plan up to date. The key is not to hide, but to notify your creditors of the changes.  

No More Borrowing

One thing which you must ensure that you avoid, is borrowing more money. Whilst in the short term, loaning money to cover your repayments and give you some cash on the hip may seem like a good idea, in the long run this will only compound your debt issues, and ensure that your repayments are made far more difficult in the future.

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