Spotting Forex Scams
Spotting Forex Scams
The Forex market is such a magnet for scam artists. It’s a place that is completely unregulated by the government. It promises people big returns for very little outlay, and it’s something that most people don’t understand very well. In short, it’s an excellent environment for frauds and con artists. If you’re just here to do a little basic trading and perhaps make a couple of thousand dollars on the side the honest way, how do you stay clear of these forex scams? Well, you familiarize yourself with them, of course.
Perhaps the biggest reason why Forex scams are so hard for the government to control is that there is basically no accountability there. Basic trading on the forex market is almost completely unregulated. Let’s take a look at how these Forex scams work.
The manipulation of bid/ask spreads is one of the oldest Forex scams around. This is where the broker asks for commission based on how much difference there is between the bidding price and the asking price (which difference is what they call the spread in the deal). There is nothing scammy about the actual commission.
Brokers get into the scammy side of things when they charge their clients more than a three-point spread. You’ll know such a broker by looking at how much they promise. If they seem to promise impossible profits, say 300% in three days and so on, you know that there’s something wrong there. Sometimes, they advertise them as 400% in 2000 pips per day.
Anyone should know that these are impossible levels of profitability for any broker to be able to deliver. But here’s a little help spotting these scams.
Most of the time, you’ll get these attractive-looking Forex investment offers in classified advertisements or on website pop-ups. You’ll know that they are scammy by going through a few steps to judge them.
A legitimate Forex trade must take place through a proper financial institution – an insurance company, a bank or a registered broker. You need to make sure that the broker you’re dealing with is registered with the Commodity Futures Trading Commission. Such a broker would never risk his membership with a cheap play free money.
No broker who tries to offer you a get -rich-quick scheme should ever be trusted. Forex trading is not such a thing, it is just a forex scam Make sure also that you don’t side with brokers who offer no financial risk.
Money Management
Times are tough, there’s no question about it! For most people, it may seem that just making ends meet is an almost impossible challenge. While your income stays static, expenses are rising. Your buying power is being diluted to the point where you’re looking to save in any possible area of the budget. Learning how to manage your money has become an essential skill. Here we’ve got some tips on making your income stretch to meet your expenses, while building a savings account, even on a modest income.
Before we begin, it’s worth mentioning the W-4 form you file with your employer. This form is where you fill in the number of exemptions you wish to claim for payroll deductions. Let’s say you’re a single person, earning $1500 a month. It’s logical that you should claim only one exemption. Did you know that you are legally entitled to claim up to nine exemptions, for payroll deduction purposes? Sure, you aren’t likely to get a refund come tax time, but claiming nine deductions will increase your net pay substantially.
When you claim only one exemption, your Federal and State tax deductions are calculated at the standard rate. You will get a nice tax refund at tax filing time, but you won’t earn any interest from the government on that money. It can be a smart move to keep that money in your wallet during the year! You can make a ballpark assessment by using last year’s tax tables to optimize the number of exemptions you claim on your W-4 so that, come tax time, you owe nothing. You can file an amended W-4 at any time.
When learning how to manage your money, you must make a budget! List all of your essential expenses first, being food, transportation, car insurance, clothing and shelter. Do the math. As you probably know, there may not be much left over. Let’s say you’ve got $200 left over each month after taking care of the necessary obligations. On paper, that may seem workable, allowing for the occasional dinner out or a night at the movies. In reality, you also know that ‘things happen’. You need new tires, an unforeseen and uncovered medical expense crops up, the phone bill is higher than anticipated. There goes your $200.
In order to understand how to manage your money intelligently, you’ve got to allow for a margin of error. Once your basic budget is in black and white, start saving all of your receipts, for at least 3 months. You’ll then see that the key to how to manage your money lies in the details. You may not have even thought of a lot of minor expenses, such as mailing packages, a trip to the cleaners or snacks and coffee purchased on the way to work. These expenses add up!
Credit cards are one of the most common pitfalls in the most well-intentioned budget. Take a look at your statements and see how much impulse or unnecessary debt you’ve incurred. Banks love to see that debt pile up. Discipline yourself to the extent that your credit cards are used only when necessary. This doesn’t mean spending your money on a pair of shoes you can’t afford to pay cash for, but should be reserved for things like new tires, a medical expense or other necessary item or service.
Here’s a great tip on how to manage your money so effectively that you, on a $1500 per month income, can end up with a $900 savings account in a year. Setting aside just 5% of your paycheck each week – $17.50 – and depositing it in an interest bearing savings account, nets you $900, plus interest, in 12 months. Save loose change, leave the magazine out of your shopping cart or rent fewer movies each week. Think about what you can do with $900 in hard cash. That’s a nice vacation, or part of your retirement savings plan !
Learning how to manage your money isn’t difficult, it just requires a hard look at the budget and a little self discipline. Good luck to you!
Money Making ideas for kids
Remember the good old days when you could set up a small table outside of your front lawn and sell cups of lemonade to passing strangers for a quarter? Those days are long gone for most of us and the reason is that it is just too dangerous for kids these days to even smile at a passing stranger, much less give him something to drink.
Americans are a litigious breed and God forbid the guy chokes on a stray seed or is allergic to real lemons and then proceeds to sue the kid’s parents. This may be a bit of an extreme example but it does give rise to thinking of alternative money making ideas for kids on a budget.
Depends on how old your child is but they can join Junior Achievement and get brownie points for school at the same time. JA teaches kids how to make worthless items such as wooden puzzles or paperweights then shows them how to market and sell this junk to strangers or other JA kids’ parents. The good thing about Junior Achievement is that it teaches children to be enterprising and enjoy the greed of capitalism at an early age. I am sure that Gordon Gecko of Wall Street movie fame was a former JAer, he just had to be.
What other good money making ideas for kids can be healthy and profitable? Collecting is certainly a good thing and most kids have some sort of valuable collectible if they really look at it. Things like comic books, baseball cards, action figures, toys, video games, etc., can all be taken out of the closet and resold on Ebay. Even a kid, as long as he has a bank account, can get an account online at Paypal and start selling his valuable collectibles to someone else. Or you may want to lookoing into gettting your child intrested in stocks for kids, in other words get them intrested in investing in the stockmarket!
Plan for retirement
In recent years we have all witnessed the dreadful collapse of the U.S. economy and heard the discouraging stories of workers on the verge of retirement who, having diligently planned, saved, and invested for their retirement, suddenly find themselves facing their latter years with failed retirement plans and limited prospects for recovery. In this aftermath, we, especially the young worker, must ask if it is still truly reasonable to plan for retirement, and set up a retirement savings plan.
Plan for your retirement, an earlier generation taught. Make your years of dedicated, diligent, hard, and honorable labor as a working man or woman in the United States the key to your dreams, dreams that you might realize in your later years. Defer immediate gratifications, buy the functional rather than the aesthetic, the practical rather than the proud, save, invest, live modestly, temperately, with an eye on the years when your age would decrease your energy, your strength, your ability to do a full day’s work, when you would have to rely on your savings and investment to live in the manner you will have achieved in the course of your working life. Make a plan for retirement and live by it was the common wisdom then–and it worked.
It worked for the young workers of post World War II. For most of those of that generation who could claim more than a few dollars of disposal income each month, the wisdom was heeded; each followed a plan for retirement. Between the 1950s and the 1990s, a retirement plan had a high probability of success. By adhering to a retirement plan, many lives were consummated, and many last years were spent in leisure and ease. Planning for retirement proved wise.
That was then, when the U.S. economy was growing steadily, when U.S. businesses, U.S. technology, and the country itself was leading the world. Even with several setbacks, the U.S. continually recovered, advanced, and surpassed. Faith in the stability and growth of the U.S. was at its highest. But that was then. This is now. Since the recent failures of our banks, the near catastrophic collapse of Wall Street, the failure of big businesses that depleted retirement funds, faith in U.S. business is now at an all time low. Now, a plan for retirement seems more like an infantile dream than an act of prudence.
Tax Returns
Back when I was working part-time jobs to help put myself through college, I had no problems filing taxes on my own. My finances were as straightforward as they came, so all I had to do was copy the information from my W-2 forms, fill in some other data, mail it off, and wait for my refund check. These days, however, my financial picture has changed quite a bit. I’m married now, I have children, I run my own business, and I earn additional income from investments. All of these changes have made my taxes a bit more complicated, so now I turn to a professional to help me with my tax return preparation.
Hiring a specialist to handle my tax return preparation for me is beneficial in several ways. First of all, the specialist will be up to date on any new laws and regulations that pertain to my particular situation. This helps ensure that I will be able to take advantage of new deductions that are available to me, which in turn allows me to either lower my total liability or get a higher refund.
A second advantage of not doing my own tax return preparation is that I will gain the peace of mind that comes with knowing that there aren’t any glaring mistakes in my paperwork. Many firms that offer tax return preparation will double- or even triple-check my forms before having me sign them. The chances of a mistake getting past two or three different professionals is minimal, so after I file I don’t even worry about it at all.
And of course when someone else manages my tax return preparation, I don’t have to endure any of the headaches, stress, or hassles that come along with struggling to complete the paperwork myself. In fact, all I have to do is answer a few brief questions and hand over my relevant documents and receipts. A few days later, I’ll get a phone call letting me know that everything’s ready, and that’s that. By outsourcing my tax return preparation duties, the April 15th filing deadline no longer fills me with a sense of dread. I know that my taxes will be finished well before that time.
Finding a professional to do your tax return preparation is very easy. Most companies start advertising campaigns in early January, so you’ll definitely be able to find someone at that time. In addition, many of the larger tax return preparation firms maintain an online presence throughout the year, which means that you can check them out and compare their services at any time. Some companies even have the capability to handle your tax return preparation entirely over the Internet. You would just have to fill in a few online forms, and then either fax or mail your important documents. Once your paperwork is ready, the company will mail it back to you so you can review it, sign it, and submit it.
As you can see, hiring a professional to handle your tax return preparation is a move that just makes sense. You’ll save time, your paperwork will be prepared flawlessly, and you won’t have any of the stress that usually hits people when they work on their taxes. So look for a specialist today so you can breathe a bit easier during tax season.
Safe investments
All you ever wanted, was a safe place to park what little money you’ve been able to eke out. You have your child’s education, and your retirement think about, and you have nothing altogether adventurous in mind for your money. All you want are some safe investing opportunities, and to get by. Well, as people who’ve been tossed about like a cork on stormy seas by the Great Recession, and who have seen their portfolios drop by maybe 6% in value in the process recently, finding out exactly what it takes to be immune to these market swings, has become quite an obsession. What they’re discovering now, is that safe investing is possible, but only at a price, its always a good idea to to take some day trading strategies too.
Not to blame the companies that offer these; any kind of income guarantee or downside protection in this market with poor interest rates and unpredictability to boot, becomes really expensive for them to support. And anyway, it’s like getting blood out of a rock getting Wall Street agree to these safe investing opportunities in the first place. If they do it at all, they are going to get you to accept lower returns for the privilege. So what is an ordinary family investor to do? Short-term money market funds just became virtually unprofitable. You’d be lucky if you could get 1% on a CD you left with them for six months.
So, safe investing enthusiasts look to Variable Annuities. You know what those are, don’t you? They are just your average bonds and stock, but they insure them for you to make sure they don’t fall in value. These are not as good a deal as they used to be. The insurance companies used to offer really generous insurance guarantees before, and did they ever regret it when the markets went belly up. Another option is the mutual fund market, but it comes with guarantees, not unlike what you see in those annuities. You just pay them a fee (not a cheap one), and they guarantee you a certain income for life. You could also try the stable-value funds. These are the best for a place to park your 401(k) money. They guarantee that you will keep your capital, and over a long period time, you get steady raises in value.
The thing is, people are so sick of seeing their money disappear before their very eyes, that there is such demand now for these safe investing opportunities. With so much demand, it’s no longer a buyers market though. Just last year alone, investors threw nearly a half-trillion dollars at these conservative investment products. Why would Wall Street even want to make things more profitable for you? People can’t have enough of these, even when they get these terrible deals on them.
Funding Retirement
We’ve all heard the dire warnings that social security benefits won’t last, and that those of us 40 and under might not receive the monthly payments we’re counting on once we retire. When you factor in how much of a hit investment portfolios have taken in recent years due to the general state of the economy and stock market, it’s no wonder more and more people are worrying about how they’re going to build up sufficient funds for retirement, and set up a retirement savings plan.
I think it’s safe to say that most folks imagine life after 65 as their “golden years”. After retiring, they’ll be able to relax, do all the things they’ve always wanted to do, and finally live life to the fullest. It’s a time for traveling the world, taking on a new hobby, and spoiling the grandkids rotten. We just trust that our 401k plans and other funds for retirement will carry us through, and we won’t have to worry about finding another source of income.
But if past economic downturns have taught us anything, it’s that we can’t count on our portfolios holding their value indefinitely. We have to be smarter about our investing so we can retire sooner and live better once we reach the end of our working careers. We cannot pull out of the market entirely, because just putting money under our mattress won’t allow us to accumulate the necessary funds for retirement. Instead, we have to learn how to make safe, low-risk investments that will grow steadily year after year.
An important first step in this process is to visit a top financial planner in your area for a consultation. Most of these consultations are free, and will give you a good idea of how the broker intends to invest your money. You should trust your instincts when meeting with planners and advisers. If the person comes off as too much of a smooth talker and reminds you more of a used car salesman than a trustworthy investor, then follow your gut and walk away. It’s far better to invest safely with some peace of mind than to chase unrealistic returns in an effort to quickly build funds for retirement.
Your adviser will probably guide you through the intricacies of 401k plans or the benefits of opening a Roth IRA, since these are the two most common ways to help sock away funds for retirement. Before committing your money, be sure to ask about early withdrawal penalties, hardship withdrawals, and income taxes once you start withdrawing. These are critical considerations that can impact your long-term financial health. You might also want to check out a good mutual fund, some high-yield bonds, certificates of deposit, blue chip stocks, and other stable financial instruments.
If you’re worrying about how you can build sufficient funds for retirement, you’re not alone. This is an issue that most of us wrestle with more and more as we get closer to that magic age of 65. But some good, sound financial planning now can go a long way towards making the golden years truly carefree and rewarding, so talk to a qualified professional today!
Mortgage advise
In these times in which we’ve seen half the country’s financial systems collapse after home loans around the nation defaulted or were deemed to be likely to, it may seem that there could be nothing better, more responsible, or more morally upright than taking the earliest opportunity to go out and make a mortgage payment, the first chance you get. It almost seems like patriotic duty to begin to settle your mortgage. But hold on there, here is a spot of sound mortgage advice: the nation still isn’t flush with funds, and if you have enough money for that payment, what if it were better spent on some other payment like, say, that credit card debt you carry. That happens to be one of the most expensive kinds of loans you could possibly hold, at 11%. You could never get 11% for a deposit in the bank; if you put your money in treasury securities, you get so little in return, you might need calculus to add it up; your investment in your home is actually losing you money, and your retirement funds are worth about 40% less than they once were. But here you are paying the credit card people as much as 11% on the money they give you.
Of course this kind of mortgage advice doesn’t apply everywhere. In some special situations, such as if you plan to retire soon; getting your mortgage principal down would get you a better refinance rate. For the rest of us though, paying back the debt that asks for very little interest, and that is also a tax-deductible what is more, should be our last priority. Paying off your most expensive loans should come first. Of course, it is rather understandable that you want the comfort of knowing that you are doing everything you can to own your home outright as soon as possible, and be debt free. In addition, it is easy to calculate the long-term effects of paying more quickly, and come up with some pretty good-looking figures. On the usual 30-year 6% mortgage, paying even a couple of hundred dollars more a month can usually save you tens of thousands of dollars in interest.
It’s been reported that about one in eight US homeowners try to do exactly that: trying to pay off the cheapest loan in the world first, a mortgage. If you happen to come under the 25% federal tax bracket, you could get tax deductions and your 6% mortgage could actually be just 4.5% mortgage. You could even get a tax break from your state government. And those tens of thousands of dollars that you figured you would save? Those would really be worth much less 20 years in the future. So what does the sound mortgage advice that the experts give you?
If you do have some money to spare, and you don’t have a credit card will be back, try somewhere else to stick the money. For instance, try contributing to your retirement plan at work. For every dollar you put in the employer often matches it with a contribution of their own. Or how about that all-time favorite, investing in safe stocks? You could get 8% in the year with the judicious investment mix in stocks and bonds. The federal government put aout study recently that said that people around the country waste more than nearly $2 billion every year trying to pay their mortgages faster than they have to. It would be sound mortgage advice, if only we could get you to rein it in.
Investing In Gold
Perhaps gold gets it’s reputation as a great investment because it is shiny; but up until very recently, it’s been a pretty disappointing investment overall, for pretty much long as anyone can remember. But now, a weakening dollar is beginning to jack up the price of gold to turn it into a super strong investment opportunity. Are you too late to the party to get in on the ground floor? Not really. It’s easier than ever before to invest in gold now.
Even if mutual funds that deal in gold like StreetTracks Gold Shares have always traditionally bought up gold mining shares and not the metal itself. This mutual fund has benefited from an 8% price rise over the past couple of months alone. If you are wondering about how to buy gold to invest in, start with a mutual fund like this. In a world that’s filled with news of financial catastrophe, this is an investment that’s priced exactly right.
If this seems a little too adventurous for your taste, an ETF or exchange traded fund is just the right kind of investment opportunity for you. It will help you buffer yourself against the ups and downs of volatile market in mining stocks. Expert stock analysts usually have no time for gold as an investment opportunity. They see the yellow metal is great for jewelry and little else. If you’re wondering about how to buy gold to invest in, you need to pay attention to how the price of gold, after having stayed stagnant for quite a while suddenly rose to $700 an ounce over just the space of a month last year. And for the most part it’s kept its value there. Does this make it a good investment opportunity? You bet it does, and here is why.
Gold essentially, works out of a very strong base. The world’s largest gold producing mines, companies like Barrick Gold and Newmont Mining are finding that the higher price of oil is driving up costs of prospecting for and mining for gold ore. And labor costs are up too. Not to mention the fact that gold ore is harder to come by today. All of these make for higher priced gold. And that makes it a good investment opportunity.
If you’re wondering about how to buy gold and time it correctly,the technical factors behind why gold is compelling as an investment today are even stronger. No matter how the price of gold fluctuates today, even the lowest prices it is capable of are pretty high. The mean price of gold has risen. Usually, when the price of gold is about to rise, gold shares seem to anticipate this and rise in price practically six months before. That hasn’t been the way they’ve risen this time around though. There was a recent article published that said that gold could rise to as much as $8000 an ounce. If that seems too ambitious, most experts predict that it should rise to about $3000 an ounce without a hitch. The price of gold is set to rise. How and when you decide to buy in is entirely up to you.
Hedge funds
It makes people feel special, exclusive, to know that they’ve chosen hedge funds as their investment vehicle. They can be mysterious in the way they work, and they certainly make you look like one of the big boys. While this might really have felt good two years ago to small-time investors like you and me, in a world that has been burned by Bernie Madoff, and seen giants like Lehman Brothers collapse in a day, unfathomable exclusivity is not really a selling point. Transparency is. And so, to present themselves better to an investor community that is once burned twice shy, many investment houses, are opening their doors to the little guys, with hedge fund strategies that allow them to be used as mutual funds. Even a $1000 investment can get you in the big leagues, investing in things like merger arbitrage and commodity futures.
In mutual funds you’ll find nothing more exciting happening today than the crack in the door you get into hedge funds. And people are certainly jumping on the band wagon. There has been twice as much money rolled into hedge fund strategies last year by small investors, as the past four years put together. The problem is, hedge funds haven’t been around for small investors for long enough, that anyone should be able to tell if these are the right idea. The returns you make on these aren’t measured by the usual market benchmarks you would see for other investments either. But still, financial planners have been around hedge funds in other markets long enough, to feel hopeful.
For the longest time, hedge funds were limited partnerships, and no one would have considered them a good investment opportunity if presented as a mutual fund. Hedge funds are not invest-and-forget propositions – your financial planner will need to do things like set daily price limits, and tinker with the asset base; doing this for the large customer bases that mutual funds have, can quickly become unmanageable. And of course, mutual funds are heavily regulated, and running around answering to these regulations can be something that hedge fund strategies don’t take into account normally.
But hedge fund providers have no option. Their biggest clients, are beginning to demand this. Hedge funds strategies are not traditionally about providing investors with any kind of liquidity. In the economic meltdown two years ago, that kind of deal got a lot of investors into deep trouble. And so, the biggest are trying to alter the way hedge funds are handled, so that a little liquidity could be brought into the mix. They do much better than the market does in a depressed climate; but they don’t do nearly as well as regular stocks in a healthy market. This makes hedge funds a great tool for the present, for the small investor.
Basically, this makes hedge fund strategies, the very thing you can hedge your investments with. These are not supposed to be your core investment plan. They are supposed be used to ensure that you don’t take too much of a hit, should everything plunge down a black hole tomorrow.
