Deciding Which Type of Bankruptcy to File

Many Americans these days are facing a financial crisis due to the bad economy. Unemployment remains at all time highs and inflation continues to devastate most average families. This has caused many people to consider filing bankruptcy to alleviate their overwhelming debt. However, when considering bankruptcy, a question that needs to be addressed is which type of bankruptcy to file. The answer really depends on the individual’s personal financial circumstances. The two forms of personal bankruptcy that are commonly filed are Chapter 7 bankruptcy and Chapter 13 bankruptcy. These two kinds of bankruptcy are really designed for two different types of debt situations.

A Chapter 7 bankruptcy, which is commonly referred to as a fresh start bankruptcy, is mainly used in situations where the debtor has mostly, if not all, unsecured debts. Unsecured debts are debts that are not secured by property or an item such as medical bills, credit card debt, or personal loans. In a Chapter 7 bankruptcy the bankruptcy trustee can liquidate or sell any personal property not protected by exemptions laws to pay back the creditors. However, due to the nature of the bankruptcy laws, it is not common that an individual loses any property in a bankruptcy filing. Instead the debtor can emerge from a Chapter 7 bankruptcy filing virtually debt free and retaining their possessions. If the individual filing Chapter 7 has some secured debt such as a car or a house along with their unsecured debt, they have two choices. They can give up the secured property and have the financial obligations for them added in to the bankruptcy filing and wiped out without any further liability to them in the future. The individual can also choose to keep, or reaffirm, the property and the debt as long as they are able to continue making the payments on them. The individual must qualify to file Chapter 7 bankruptcy by meeting the required income level for the state they reside in or they will be forced into filing Chapter 13 bankruptcy.

A Chapter 13 bankruptcy, otherwise referred to as a wage earner bankruptcy, is used when an individual makes too much to qualify to file a Chapter 7 bankruptcy, they really want to try and pay their financial obligations back, or they are behind on their payments for secured debts such as a car or home and they want to keep the property. In this situation when the debtor is in jeopardy of losing their home to foreclosure or their car to repossession, a Chapter 13 bankruptcy is king. The debtor will still receive the advantages of the automatic stay during the entire bankruptcy process prohibiting all debt collection activity and the debtor will work out an approved repayment plan with their bankruptcy attorney that will last for 3-5 years allowing them to get caught up on back payments. Any unsecured debt left over after paying the secured debts first will be discharged in the bankruptcy filing, thus allowing the debtor to keep their property. If at any time during the Chapter 13 repayment plan the financial situation of the debtor deteriorates, they can go back to their bankruptcy attorney and convert their Chapter 13 into a Chapter 7 bankruptcy.

The bottom line is that the debtor does have some options when looking at their situation. However, it is best to consult with a bankruptcy attorney in the beginning to discuss these options and which chapter of bankruptcy is best suited for their needs.

There Are No Free Lunches

Our society has changed so much. In my day, it was a given; if you wanted something, you worked for it. If it costs more than you made, you saved up for it. You were not entitled to anything. If you were part of a family, you were expected to do chores.

And then there was the issue of an allowance. Are children entitled to an allowance if they don’t do anything to earn it?? I think children need to learn that if they want to be part of a family, certain things are expected of them that have nothing to do with getting paid.

It is a parent’s right to expect each member of the family to do some chores. Now, I’m not talking about the Cinderella Syndrome; I’m talking about things like making your bed every day, doing some of the housework, clearing your dishes from the table after you’ve eaten, keeping your room clean, etc.

The kind of chores that tell a child that he is a member of a family and he has a certain responsibility to that family. It gives a child a feeling of belonging while developing a good work ethic.

But, above and beyond the usual chores that are expected of a family member, there is a compelling reason for giving a child an allowance for the extra chores that he does. In addition to giving him the feeling that he is a valued member of the family, it also teaches him some fundamental lessons about budgeting and prioritizing. He learns that he can’t have fifteen #1 priorities; he can only have one #1 priority. This, in turn, teaches him how to make good decisions.

It also teaches him that he is not entitled to anything. He learns that there is no such thing as a free lunch and if he wants to be successful at home and at work, you have to give something of value if you want something of value.

An allowance also teaches a child to distinguish the difference between want and need, as well as teaching him that if he wants something that isn’t covered by his allowance, he has to save up for it.

A young child can hone his entrepreneurial skills by finding projects that he can charge his parents or his neighbors for to fund the things that his allowance doesn’t cover.

As a child gets older, his wants will greatly exceed his needs and that, if anything, will be his prime motivation to learn the basic rules of finance and budgeting.

Whatever a child learns at home about handling money will be the building blocks or the stumbling blocks for how he deals with his finances as an adult.

Connie H. Deutsch is an internationally known business consultant and personal advisor who has a keen understanding of human nature and is a natural problem-solver.

How To Save Money On Your Heating Bills

How much do you think you spend on your heating bills at present? According to the Energy Saving Trust, on average half the money spent on utility bills in the UK goes towards heating and hot water.

Is it therefore any surprise that come the first sign of winter, many households have the same debate rumbling on, whether to put the heating on. But, did you know that by taking precautionary steps, you can reduce your energy bills at the same time as keeping your home warm. Five top tips we recommend are…

Make an Extra Layer Your First Choice:

Many of us opt to switch the heating on the moment that we feel a chill in the home. Automatically reaching for the heating will cause your energy bills to rocket. Instead, your first option should be to make an extra layer of clothing your first choice to keeping warm.

Have Your Boiler Serviced Annually:

As with all appliances within the home, general usage can take its toll on your boiler. This wear and tear will leave your boiler performing below its optimum level, hindering its efficiency and costing you more in energy bills.

To reduce the risk of wear and tear on your boiler, you should have it serviced annually. Ideally the service should take place before winter takes hold.

Along with getting your boiler serviced, it’s also recommended to install a CO2 alarm next to the boiler.

Bleed Your Radiators:

If you’ve put your heating on and found that the top of your radiator is cooler than the bottom, then you’ll need to bleed them. This isn’t a difficult task, nor is it time consuming. But it is one which should be carried out at the earliest opportunity to save you money on your energy bills.

To bleed your radiators, all you’ll need is a radiator key and a towel.

With your heating off, use the radiator key to turn the valve at the top of the radiator to release any trapped air. Whilst doing this, hold the towel just below the valve to catch any water which may trickle out. As soon as water appears, close the valve.

Set TRVs Low:

Many modern radiators come with TRVs, which enable you to set the temperature of the individual radiator. Whilst many of us will turn the TRV to six, this will cost you money without heating the room any quicker.

To help save money on your energy bills, set the TRV to its lowest setting, before gradually turning them up until you find a comfortable room temperature. It’s also recommend to keep the TRVs on a low setting in rooms which aren’t frequented often. This will help keep the room warm without wasting heat.

Utilise Natural Heat:

OK, so the sun isn’t as strong during the winter months, it can still provide the required warmth to naturally heat your home. To make the most out of the natural warmth from the sun, leave your curtains open during the day, and closed during the evening.
Along with closing your curtains during the evening, it’s also a good idea to keep internal doors closed where possible.

These five simple steps will help you to save money on your heating and energy bills, at the same time as keeping the house warm. But, for those who are looking for an additional heat source there are a number of portable radiators available which will provide the heating requirements you need.

Indian Monetary Policy

Monetary policy is the ways and methods that central banks use to control the economy. It helps the central bank to maintain an adequate amount of money supply in the market. The money supply in the market grows rapidly, it will increase the inflation. On the other hand, if money supply is less, it will hamper the growth in the economy. We now confine ourselves to Reserve Bank of India as the central bank. There are different tools used by RBI to maintain the adequate supply. These tools can be divided into two parts as is shown above.

We now will try to explain some the terms used in monetary policy tools.

Cash Reserve Ratio: It is the minimum amount of money that the banks have to hold as reserve with the central bank. This is done to ensure that the banks have adequate amount of liquidity with them to meet the payment demand of their customers.

Statutory Liquidity Ratio: This is the minimum amount of reserve banks need to maintain in the form of cash, gold and government approved securities before lending to its customers.

Liquidity Adjustment Facility: This is used by banks to adjust their day to day mismatches. Here the banks are allowed to borrow money through repurchase agreement. Central and state governments, Banks and non-banking financial institutions (NBFI) lends and borrow money for adjusting their liquidity mismatch. The minimum amount that can be borrowed under this window is Rs5.00 Cr. Here the money is borrowed at repo rate.

Marginal Standing Facility: Under this facility, the scheduled commercial banks are allowed to borrow money from RBI at 1% higher than the ongoing Repo rate under Liquidity adjustment facility. The minimum bidding amount is fixed at Rs.1.00 Crore. Here the banks are also allowed the government securities which are part of their SLr quota. The maximum borrowing amount is fixed at 2% NDTL( Net Demand and Time Liability)

Bank Rate: This is the rate at which the banks are allowed to borrow from RBI for long term.

Net Demand and Time Liability:

Demand liabilities include money deposited in saving and current account, unclaimed deposits, etc. To simplify, it includes all that money which the customers can demand whenever the feel the need of it.

Time liability is where there is a fixed time scheduled for the money to mature and being demanded by the customer. This includes Fixed deposits, Cash certificates, security deposits, gold deposits, etc.

Mistakes Wealth Management Advisors Make When Moving

Moving is stressful, but what is more stressful is when the move impacts areas that it should not. This can include a relocation of your home or office, whether it is across town, across the world, or simply to a new company.

This is why when wealth managers meet with a finance industry recruiter they are advised to make sure the move is as seamless as possible, meaning that clients understand what is happening ahead of time, are kept abreast with a quick note during the process, and that they do not get any negative surprises in the process.

This applies to the financial advisor who moves from one company to another, as well as to a wealth manager who decides to convert his focus to caring for family offices.

Mistake #1: Announcing a Move Before it is Final

One advisor who is a client of ours was all set to move from his current firm – a large bank – into a leadership role at a private equity firm. He succeeded in all of the interviews, made a great impression, and had just accepted his employment package. Emotionally, he was gone.

However, the firm was going to have him start at the beginning of the year – 2 months away. When December came he gave appropriate notice to his supervisor and then began to speak freely about the move to clients. It was that week that that firm fell under investigation for securities fraud and later closed down.

It made him look very foolish, and clients couldn’t help but question his judgment.

Mistake #2: Not Announcing the Move When it is Final

Another person we know was able to make a very successful move. However, he had failed to communicate the change to his clients. When they received statements the only thing they could conclude was that something was wrong. After all, they always banked with ABC, not XYZ.

It all ended up being okay, but it was a lesson in customer service that wouldn’t be forgotten.

Mistake #3: Losing Sight of Customer Service

Moving takes a lot of time and energy, so it is understandable that one may find him or herself in a whirlwind, but for clients who feel as though they have lost access to you, they may wonder why they are with you, especially if they get bogged down in the day-to-day fluctuations of the market.

A simple way to resolve this before it occurs is to make sure that clients receive your new contact information. This should be done by email and through the mail. For those who have 100 clients or less, it would be a great idea to reach out by phone to each of them over the course of a week. The calls will take just a minute or two for the most part, but it’s also an incredible opportunity to get to know them better to solidify the relationship.

Wealth managers can do just about anything once they have earned their stripes. However, the skills involved with managing wealth also include managing relationships, which is what everything is built upon.