AltunQotka Business Blog

Archive for March, 2011

Term life insurance provides you with a more affordable opportunity to ensure you mortgage payments in the unfortunate event of your death. Even though they are offered for a limited time-period, but you can always match them up with your mortgage payment cycles of 10 or 20-year contracts. For the budget conscious, this definitely seems to be a smarter alternative for a low cost death benefit.

Insurance companies offer cheap term life insurance policies with different contract time periods, conversion credit during the first five years and transferable waiver of premium.

Affordable alternatives are available through comparison-shopping at various online insurance intermediaries’ websites. Other than being a cheaper option, term life insurance is better in other aspects when compared to a mortgage life insurance. There are much personalization options available for a term life insurance policy. The proceeds from a term life insurance go directly to the beneficiaries instead of the lender, so the money can be used by your dependents as desired which could be even to pay off other debts. Term life insurance also pays a death benefit. According to NAIC (National Association of Insurance Commissioners), the companies pay almost 90 cents to the dollar in benefits for term life insurance policies. Typically the whole life insurance will be 2 to 3 times costlier than a term life insurance.

Term life insurance offers the cheapest alternative to provide insurance coverage for your dependents. It has allowed individuals under budget-crunch situations to buy policies with larger payout amounts due to the limited term of the coverage.  So, if you can renew your term life insurance regularly during your lifetime, you have actually found an affordable alternative to expensive whole life insurance.

Home mortgages are loans that are taken to buy a property, for which the property itself is used as collateral. Owning a home is a very big, and usually a one-time investment for many. With increasing real estate prices and decreasing interest rates on loans, many people are using the home mortgage loans to buy property.

Home mortgage rates are the rates of interest that are to be paid along with the capital for taking the mortgage loan. Home mortgage rates do not remain steady over a long period of time. A lower rate means lower monthly payments, leading to lower costs on the property. Depending on the kind of interest rate, there are two kinds of home mortgage loans: Fixed Rate Mortgages (FRMs) and Adjustable Rate Mortgages (ARMs). FRMs are mortgages for which the rate of interest remains the same for the entire period of the loan. These can be for a period of 10, 15, 20 or even 30 years. Adjustable rate mortgages, on the other hand, have fluctuating rates of interest. This is ideal when there is likelihood of the rates to decrease. ARMs are preferred by people who plan for shorter periods. ARMs are offered at lower rates than FRMs to attract customers, but they also contain a certain level of risk. The fixed rate mortgages are a very predictable, safe option.

Mortgage rates fluctuate on the basis of an economic index. The mortgage bond market works according to a process called securitization. This securitization enables creation of more loans and greater mobility of funds by keeping the mortgage rates low and allowing more credit for ideal customers.

The best source for knowing about home mortgage loan rates is the Internet. Most home mortgage loan companies provide information through their websites also. These rates are updated daily. Their sites also have easy-to-use home mortgage calculators that give all information, including payments to be made each month and the tax advantages, with the single click of a button. Most of them also have financial advisors who would provide advice online, or over the phone. A professional mortgage lender would be able to provide accurate information about the mortgage loan rates as and when they are applicable.

Walking through the financial maze of stocks, bonds and mutual funds can be quite a challenge. American Century Investments offers the following tips to give you the know-how on building a profitable portfolio.

* Know your goals. Consider how much money you’ll need for your children’s education or your retirement. Whatever your vision for the future might be, set your goals and develop a concrete plan for meeting them.

* Define your investment time horizon. If you’re not planning on retiring anytime soon, you might want to have a portfolio that includes more long-term investments. If retirement is just around the corner, consider a more conservative approach.

* Determine your risk tolerance. Figure out your risk comfort level and compare that with what you can afford. In general, the longer you have to invest, the bigger risk you can take.

* Consult a professional. In order to avoid financial pitfalls later on, it is often wise to seek professional guidance when putting together a portfolio.

“Recent research shows that investors continue to grapple with some of the most basic investment concepts, suggesting a greater need for financial advice and guidance,” said Doug Lockwood, a certified financial planner.

To help investors meet their financial goals, American Century Investments has developed On Plan Investing, a program designed to help investors build and maintain diversified investment portfolios – at no additional cost.

Combining educational tools, advice, market insight and investment products, On Plan Investing helps investors develop a personal investment strategy, whether they are new to investing, seeking guidance but still want control over their investment mix, need help positioning their portfolios with a long-term perspective or need help understanding how the markets work.