Archive for December, 2007
Nominal And Effective Interest Rate
Thursday, December 27th, 2007
In the next two or three posts I am going to write about some basic definitions which are applicable to all investments.
Nominal Interest Rate: This is the interest rate that is quoted without taking into account the effects of compounding (number of times the interest is calculated in a year).
Effective Interest Rate: This is the [...]
What Is Credit Crunch Crisis ?
Tuesday, December 18th, 2007
Lately we have been hearing a lot about the ‘Global Credit Crunch’. This Credit crunch started in the American Mortgage Markets. So lets begin by trying to understand how the mortgage market works in America:
Like in other countries, American home buyers approach banks and non banks for money. To lend to the home buyers, [...]
How To Set Financial Goals
Thursday, December 13th, 2007Everyone must have financial goals. Let me rephrase that - ‘Everyone must have well defined financial goals‘. And of course these goals have to be realistic to a certain extent. Goals can be divided into short term and long term goals.
Long Term Goals: There are different definitions of long-term goals. Some people define it as [...]
Advantages Disadvantages Of Internet Banking
Wednesday, December 12th, 2007Since my bank launched Internet Banking I have been making less trips to my bank. I love the ease and comfort of doing my banking in my own hours - from the comfort of my own home. Here is what I use my online banking for (advantages of internet banking):
Bill Payments: I pay all my [...]
Medicare Levy Surcharge
Sunday, December 9th, 2007Every Australian Resident Taxpayer pays a medicare levy. The levy is 1.5% of the taxable income. Medicare is a scheme which gives the Australian residents access to the public health care system. The levy is charged so that the Australian Government can fund the public health care system.
To reduce the demand on public health [...]
Interest Rates - Why Do They Rise Or Fall
Wednesday, December 5th, 2007Since May 2006 the cash rates have gone up by 1%. Its currently at 6.75%. The Reserve Bank Board meets on the first Tuesday of every month. In the meeting the Board makes decisions about the level of interest rates - the cash rate. Interest rate rises affect every household.
Every time there is rise [...]
