How to Know if You Have a Crappy 401-k Plan

Too much of the mutual fund fees can diminish returns on a retirement plan. But most do not realize that until it is too late. Here are the most common signs that tell you if you have signed up for a bad 401(k) plan.

The Fee is over the Top

Market fluctuation is not the biggest risk to 401(k) retirement portfolio, it the fee that is charged. An average small business comes with annual fee that is equal to 1.56% of all assets. This means that for every $10,000 that one invests, $156 goes towards fees every year. In 12 months time that may not feel like too much, but over the decades one spends in a workplace, this number can add up to be a fortune. If one investor contributes the maximum amount into a 401(k) on a monthly basis over the course of 25 years, their annual return on S&P 500 will be 9.62%.

It is Not Exactly User Friendly

It is not the easiest thing in the world to get started on a 401(k) plan. Some people never even do because of this. However automated enrolling is exactly what is meant to counter this. As an employer, one should do whatever they can to provide their employees with this.

401(k) administrators that only focus on bringing in new participants for the plan instead of improving on the user experience of the ones who have already signed up for this, run inferior administrations. This is because they believe that for them it is more cost effective to invest in attracting more customers than working on satisfying the ones that they already have.

Instead a good plan in one that offers you easy access through modern technologies that are used for connecting with friends, shopping, investing, and banking. A 401(k) plan should be very easy to access through whatever device one decides is easy for them.

On top of that, most middle tier plan administrators invest a lot in the salesy sites they have, which gives off an impression of their supposedly impeccable service, when it is just there to attract more customers.

Lack of Fund Diversity

Fund selection goes beyond the prospect of fees. Mutual funds are available in all sorts of varieties, and it does not matter how bad the retirement saving plan is. The deal is that these funds are never really run by investment professionals who invest in assets and try to beat a target index.

Index funds are managed passively, and match a certain index by simply mimicking it. This is because an index fund does not need research and saves on administration costs. Now when the time comes to cut the fee from the performance of an actively managed fund, equity returns always underperformed target indices when it comes to long term horizons on investments. And this is not all, at times, investors are overwhelmed by the different asset classes that are available, and against those prefer funds that are self adjusting and simple.


Some Impartial Car Finance Advice

If you are looking for a car finance option, you will find a long list which you can scroll through. Among the notable ones, you will find hire purchase, personal loans, personal contract hire and personal contract plan. Choosing the right one can appear to be a daunting task and looking for an unbiased advice may seem to be even more difficult. However, we are here to impart some impartial car finance advice that we hope can help you with better decision making.

If You Want to Finance with a Personal Loan

Provided you have good enough credit ratings, we would suggest that you should seriously “consider” the option of personal loan to finance your new car.

Why? What’s the advantage of opting for a personal loan?

The reason is simple: you get to own the car immediately and if something goes wrong in future, you can sell it off to cope up with any financial gaps. Furthermore, with personal loans your monthly payments may seem a bit higher but the overall amount you pay is much lesser than what you would have to pay through other car financing modes.

And is there anything else to take into account?

Yes! A personal loan for a car, although secured with the purpose of financing your car, does affect your overall credit line which may influence your chances of securing, let’s say a mortgage. Not only that, with a personal loan your lender is not at all bothered about what you would be doing with it. If a dispute arises with one of the car dealers, you will have to sort it out yourself.

This could be complicated. Let me look at other options.

My Hire Purchase Option, What About That?

Yes it may offer a comparatively lower monthly payment option than the personal loan, it is secured only against your car, offers you no mileage restriction unlike PCP or PCH and it also protects you over any dispute with the manufacturer, but it also harbor few traps.

How? This seems like the perfect option. Plus I get to lower the interest rate further by increasing the term of payment.

You do have a point. But it is important to note that more you use a car, chances are that you will have to spend more on its maintenance. You can end up paying a lot more than what you would have initially paid over a shorter length of term. And remember, you cannot sell or own that car unless you clear all your payments.

Then PCP Must Be the One!

That depends. With the lowest monthly payment amongst all modes, it has a large sting in its tail with that balloon payment. Plus you would also have to pay extra charges if you exceed on the pre-agreed mileage. However it gives you the option of switching your car if you are not pleased with what you have. And unlike PCH, you can actually choose to own the car at the end of agreement.

Some General Advice

With the specifics covered we would now like to give some general advice. Always test drive the car that you want to own. And use your credit card to make the monthly payments for your car finance as it gives you extra protection on payment. On a closing note, whichever option you decide for, remember to read the papers thoroughly and not just buy into what the dealer has to say.


What Mortgage Type is The Perfect Fit for You

If you are looking to get a house then you will require a mortgage loan. There are many types of mortgage loans which are each fit for a particular group of people. You need to gain the information about each type in order to identify the right mortgage option which fulfils your loan needs with perfection.

Here, we present the most common mortgage types that are available in the UK and often selected by people. especially for buying their first property.

Fixed Rate Mortgage

The most common type of mortgage is the fixed rate mortgage. The lender charges you a fixed interest rate for the whole duration of the mortgage. This rate is often subject to the standard interest rate in the country as well as the period of mortgage. It increases with the increase in period of mortgage. It cannot vary during the period of payment, but late fees and other penalties may be added in case of failure to pay monthly instalments.

The disadvantage with this mortgage is that you cannot enjoy the benefits of a lower interest rate if economic conditions change in the future. On the other hand, you are also protected if there is a negative effect in the economy causing an increase in the variable interest rate. There is also a penalty if you want to opt for an early repayment.

Tracker/Variable Rate Mortgage

This mortgage is formulated on the base rate of interest which is set by the bank of England in the UK. Most tracker mortgages are at 2% above the base rate. This rate changes each time there is a change in the standard interest rate in the country. Tracker mortgage rates are often lower than fixed rates but you are at a risk if the economic conditions change.

Tracker mortgage also has some penalties for paying off the loan, but there are many tracker mortgages which only charge a small fee to pay off the complete loan amount. They are riskier than their fixed rate counterpart.

Offset Mortgage

This is a special mortgage which employs your savings. It allows you to pay interest from your current amount of loan. You can place additional money in your savings account which is taken as the principal amount of loan that you are returning. This means that your additional savings are used to constantly decrease the remaining mortgage thereby reducing the interest with each month.

This type of mortgage is suitable for the bank as well  as the debtor is responsible to pay it completely after the designated period of either five or ten years.

Which is Better?

This depends on your financial circumstances and your preferences. A person who has a stable income and wants to pay off the loan in a long time needs to select a fixed rate mortgage. A person who is sure to pay the mortgage in just two to three years can ideally select the variable rate mortgage option. For a person who is running his own business and doing well, the offset mortgage is a great option as he can greatly reduce the loan amount whenever he earns a big amount.…

Big Data: How to Make Big Sales with Ironclad Results

Big data is an old concept in the world of virtual marketing. Business telecoms have been using strategies that include gathering of salient data for present and future business reference. Marketers in business telecommunications and other industries know the practices of database marketing and data mining. The method helps you determine and target customers based on gender, industry, country, and other salient factors

The term big data generally refers to the quantity of information that is generated and stored per second on a global level. These are terabytes of information available in the virtual world. However, it is imperative to note that this huge source of data is useless if you don’t have a plausible way to navigate the available information. There are four salient factors that affect Big Data, known as the four Vs:

1. Volume

This refers to the scale of data presented and gathered. According to reports, most companies located in the United States have at least 100,000 gigabytes or 100 terabytes of data stored. 6 billion people out of the 7 billion world population own cell phones, which are also huge sources of information. An estimate of 2.5 quintillion bytes of data is produced per day while 40 zettabytes or 43 trillion gigabytes of data is predicted to increase 300 times from 2005. The same amount is expected to be created by the year 2020.

2. Velocity

Big Data also depends on its velocity or the analysis of streaming data. The New York Stock Exchange for instance captures an approximate of 1 TB of trade information per trading session. Contemporary cars have 100 sensors which track items such as tire pressure and fuel level. A projected 18.9 billion of network connection by the year 2016 states that each person on earth will have almost 2.5 connections.

3. Variety

There are different forms of data available in today’s digital world. There are 30 billion pieces of online contents being shared on social networking giant Facebook in a monthly basis. The global healthcare industry is known to have recorded 161 billion gigabytes of data as of 2011. There are 200 million active Twitter users per month that send 400 million tweets per day. YouTube documented more than 4 billion hours of video viewings each month.

4. Veracity

The uncertainty of the data also plays an important role in classifying Big Data. According to reports, $3.1 trillion is lost in the economy of the U.S. due to poor data quality. A survey shows that 27% of the total respondents state that they are unsure of the accuracy of the data they receive online. One in three business leaders on the other hand do not trust their data when making important decisions.…