When a couple first starts out, they often have two incomes and will set up their household budget based on that combined total. But as soon as the first financial crisis hits and one of those incomes is reduced or even wiped out, everything can fall apart. The solution; couples should make every effort to live on one income. Use the second income for savings and extras, many of which will be needed due to the additional job.

Derrick Raines

Below is information that you will deem helpful as you file your 2008 taxes

Source: IRS.Gov (please visit their site for more info on this)

Now that the shopping is over for the holidays, it’s time to get our goals on paper. There are 5 areas we should concentrate onm for a overall healthy fiajncial state.

1. Pursue a healthy Debt to Income Ratio:

In order to qualify for a mortgage for which the lender requires a debt-to-income ratio of 28/36:

• Yearly Gross Income = $45,000 / Divided by 12 = $3,750 per month income
• $3,750 Monthly Income x .28 = $1,050 allowed for housing expense.
• $3,750 Monthly Income x .36 = $1,350 allowed for housing expense plus recurring debt or monthly revolving debt. This is a good measuring stick to see if you have healthy “DTI”

Click here:http://www.magicjack.com/9/index.asp

Elder Raines

Hi guys I ran across these tips and thought they were great for those of us who like to save. Some of these can be done with very little out of pocket. Others may require a long term plan. Remember our meters are revolving 24 hrs a day, anything to slow it down puts money back into our pockets. ENJOY!

Utility bills can consume a very large portion of your paycheck. Wouldn’t it be nice if you could pay 25-50% less on these bills? There’s a number of ways you can. Don’t worry you won’t find any low flow toilets on this list!

#1 Change your light bulbs - Compact florescent bulbs use about 25% the electricity of standard incandescent bulbs and will last for years. They do not work with dimmer switches, but you can swap out the majority of your light bulbs and save a significant amount on lighting.

#2 Check your insulation – Go in your attic. Does your insulation cover all the 2×4s? If not you don’t have enough. Having a well insulated house will save you a significant amount on your heating and cooling bills and is well worth the cost. It’s also the kind of project the average home owner can do by themselves.

#3 Add caulk and weather stripping – Is your house drafty? Look at your doors, does light shine in? Feel around the edge of your windows, do you feel a cold or hot breeze? You need to add caulk and weather stripping. It’ll save you money and help get rid of those annoying hot and cold spots in your house.

#4 Fix leaking faucets – I’m sure you’ve heard even a small drip in your sink can fill a swimming pool in a year. It can also empty your bank account. Fixing this problem is usually as simple as replacing a 50 cent washer.

#5 Use fans – By having a slight breeze you can usually turn your AC up a degree or two and still be just as comfortable. It’s a whole lot cheaper to run the fan than to run the AC, so use them.

#6 Turn the computer off – That 300 watt power supply in your computer is still drawing power when you’re not using it. Turn your computer off when you’re done with it. If that’s too much of a hassle, adjust the screen saver settings to put your computer in sleep mode when it’s idle. This is a low power mode that will allow you to quickly resume your work where you left off when you’re ready to use the computer again.

#7 Switch to LED Christmas lights – You wouldn’t think you’re Christmas lights draw that much power, but when you get enough of those little lights, it really adds up fast. 25 watts per 50 bulb stand is standard and when you hook up 10 of those strands you’re looking at 250 watts, probably running 24/7. Christmas lights that use LED bulbs use 80%-90% less electricity and still look just as bright. Also, turn your lights off when you go to bed.

#8 Get an LCD computer monitor – Are you still using an old style CRT display for your computer? Switch to LCD, they consume as little as 25% of the power of a CRT monitor of the same size. You were looking for a good excuse to switch anyways.

#9 Swith to tankless water heater – It amazes me how few people even know about the existence of tankless water heaters. These water heaters do not store hot water, but rather heat it instantly whenever it is needed. The consume a mind-boggling amount of energy when in use, but it ends up being much cheaper to consume a lot of power during the time you need hot water than a little keeping it hot 24/7.

#10 Change your filters – So you change the filter on your AC/Heating unit every spring and fall like you’re suppose to? Wrong! Most filters are only rated for 30 days. Filters are cheap, so change them frequently. The efficiency gained in heating/cooling your house will make well worth it.

#11 Install a programmable thermostat – These are fairly cheap and easy to install. Why pay to cool your house while you’re gone to work? Do you really need it to be the same temperature while you sleep as when you’re awake? Programming it will allow you to make these energy savings adjustments automatically every day.

#12 Take (short) showers instead of baths – Try this one day. Pull the plug on your tub and take a shower like you normally do. When you’re all done, look at the water level. It’s probably about a quarter of the way full. This is how much water, and energy heating that water you save by taking a shower instead of a bath. If you can shorten your shower, even better.

#13 Ditch the phone company – Remember those “We don’t care, we’re the phone company” adds from Saturday Night Live in the 70’s? Not so anymore. They now have competition from the cable company, cell phone providers and internet phone companies. Shop around and you can probably find a better deal. If you use cell phones all the time, you may even be able to shut off your home phone.

#14 Cancel extra TV channels – Do you pay $50-150 a month for 500 channels but end up just watching the networks? Cancel the extra channels and save some cash. If there’s one show you just HAVE to have on one of these other stations, considering paying to download that one show from iTunes or elsewhere instead.

#15 Have AC Maintenance – If your AC is struggling to keep up in the summer, it might be a good idea to have some routine maintenance done. Low Freon levels can significantly impair the efficiency of your AC unit. So can grass clippings and other debris.

#16 Clean that lent trap – Be sure to empty the lent trap on your dryer after every load. If you are doing so and your clothes are still damp, there’s probably lent that has built up in the exhaust hose and it may be time to replace or clean it.

#17 Have a free energy audit – Many power companies provide energy audits free of charge. They can help you find inefficiencies you may not be able to find on your own, and will sometimes even provide you with free compact florescent bulbs. Contact your power company to see if they offer this service.

#18 Get some shade – Blocking out direct sunlight can significantly lower your cooling bills. Plant some trees that will help shade your house and close the blinds on hot days.

#19 Water in the early morning – If you water your grass on a regular basis do it in the early morning hours. By doing so you reduce the amount of water that evaporates which means much more gets to the grass. It’s not recommended to water in the late evening because having damp grass overnight provides a good environment for parasites that can harm your grass.

#20 Change your shower heads – You can switch to a low flow head without having to settle for a whimpy shower. Newer shower heads available can generate just as high of pressure but use less water. They do this by quickly pulsating between on and off to deliver rapid high pressure bursts. These heads are only about $20, have multiple settings you’ll love and can save a lot of water.

Elder Raines

There are 5 different types of debt:

1.Credit Card Debt

2.Consumer Debt

3.Mortgage Debt

4.Investment Debt

5.Business Debt

When using any of these debts always ask these questions:

1.Does it make economic sense?

2.Do my spouse and I have harmony and agreement about taking on this debt?

3.Do I have spiritual peace about entering into this debt?

4.What personal goals and values am I meeting with this debt that can be met in no other way?

The fundamental danger of debt is that compounding works against you rather than for you. Anytime debt is incurred there should be a guaranteed way to pay it back and have at least the required installment amount in your discretionary income.

Never incur debt to pretend a lifestyle that doesn’t exist, live strategically and always calculate the cost before entering into any debt contracts.

E. Raines

• The tax credit is available for first-time home buyers only.
• The maximum credit amount is $7,500.
• The credit is available for homes purchased on or after April 9, 2008 and before
  July 1, 2009.
• Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit.
• The tax credit works like an interest-free loan and must be repaid over a 15-year period.

The credit scoring system is being modified yet again as Fair Isaac Corporation, developer of the FICO credit score rolls out a new model dubbed FICO 08. The third formula “upgrade” that Fair Isaac has released since inception, it’s hard to predict how long it will be (if at all) before FICO 08 is embraced by lenders and subsequently used on a widespread basis.

A demand by users for a better way of analyzing risk in the wake of rising mortgage defaults and consumer credit delinquencies has pushed Fair Isaac Company into speeding up the release of the revised formula. Of the three major credit reporting bureaus, Experian and TransUnion indicate that they will likely offer FICO 08 to lenders by the second quarter of 08. Due to the pending litigation between the credit bureaus and Fair Isaac regarding the VantageScore system, Equifax has announced it will not offer the new version of the FICO score until the lawsuit is resolved.

FICO 08 will have the same numerical range as the current FICO scoring system, 300 to 850, with higher scores indicative of lower credit risk. According to Fair Isaac, FICO 08 should result in a minimal increase for most consumer’s credit scores as compared with the current FICO system. They say the new FICO 08 formula takes a more refined look at people who have credit problems, giving some leniancy to those consumers who had only experienced one serious credit setback. As long as their other active credit accounts are in good standing, a single charge-off or repossession for instance will not hurt them as significantly as it does under the classic FICO scoring formula.

A summary of the major differences in the FICO 08 Credit Scoring Formula:

1. A “moderate” level of credit inquiries will be less detrimental
2. High balances on existing credit cards may hurt more
3. “Piggybacking” or “authorized user” loopholes will not be allowed
4. Acively utilizing existing credit accounts will increase in importance
5. A combination of installment and revolving credit accounts will be optimal

What does this all mean? FICO predicts that the new FICO 08 scoring system will help lenders reduce default rates on consumer loans between 5 and 15 percent. They indicate that FICO 08 should be less strict on consumers who make the occasional slip, while coming down harder on those with multiple offenses. For example, it will give a slightly higher score than previously to a borrower who is late on one payment obligation but current on multiple other accounts. Those with several delinquent accounts could find their credit score reduced.

The FICO 08 formula will still take into account the same factors as the classic version namely on-time payment history, length of credit history, amount of debt, ratio of debt to available credit, type of debt, and any excessive amount of recent new credit (of course definition of excessive is unclear). One will also receive a higher score for the “optimum” mixture of credit debt. For example, a consumer with both revolving and installment credit will score higher than one with strictly credit card (or revolving) debt.

Another signficant change in FICO 08 involves the practice of “authorized users.” An authorized user is a consumer who is not responsible for paying a credit card, but that card’s history is reported on the user’s credit as well as on the owner’s credit. It is a common practice for parents to make children authorized users of their cards in order to help them build credit. Additionally, many spouses obtain the bulk of their credit histories from being authorized users of their husband’s or wife’s card.

In summary, the jury is still out as to whether the revised FICO 08 credit score will become the industry standard for lenders anytime soon, but be aware of the potential changes that may affect your credit rating at some point in the (perhaps not so distant) future.

Source:Credit Info

1. Tithes (10% of monthly income)

2. Pay Taxes

3.Investments (401K,Stocks,Education Funds, Roth IRA etc..)

4.Savings (put money away for emergencies) typically 5% of your monthly income

5. Fund your Life Insurance

One or two of these categories may change depending upon your personal situation. After these items have been funded the remaining balance is what I refer to as your lifestyle fund. This remaining amount is what a person or family has left to cover their living expenses. Below is an example:

Person “A” earns $2000/month and after they cover the 5 prerequisites they have $1200.00 remaining. It is from this amount that a person begins to fund their lifestyle. The golden rule is to never allow any future purchase to interrupt these 5 financial requisites. Every human being should purpose to fund their financial future before they fund their lifestyle.

Elder Raines