Opinionated Fool

Friday, November 4, 2011

Your Credit Card Transactions Will Be Used To Target You With Web Ads

Next time you go to to a fast food restaurant you could go on the Internet half an hour later and see a weight loss ad on your favorite Web site.

Brought to you by your credit card company of course. According to a recent Wall Street Journal article (October 25, 2011), the two largest credit-card transaction companies, Visa and MasterCard have recently patented technologies that would utilize their massive consumer transaction databases to target consumers with online advertisements. Targeted online advertising is nothing new, but this could bring targeting to a whole new level. Most people either use a credit card or a debit card to make purchases. If a marketer knows exactly what you are buying, they can target you with exactly what you are interested in. As Visa puts it, "You are what you purchase."

Visa and MasterCard's technology patents have included details on how credit card transaction data would be linked with an individual's other behavior profiles, such as social network usage and even DNA databanks. Both companies claim that personal information would be "anonymized", but I have my doubts.
Be careful, the big companies are watching.

Thursday, November 3, 2011

The Starfish Story - Making a Difference a Little at a Time

Most people have heard this story before, but if you haven't it's a good one to get you thinking.

An old man was walking down the beach just before dawn. In the distance he saw a young man picking up stranded starfish and throwing them back into the sea.

As the old man approached the young man, he asked; "Why do you spend so much energy doing what seems to be a waste of time?"

The young man explained that the stranded starfish would die if left in the morning sun. "But there must be thousands of beaches and millions of starfish, exclaimed the old man. "How can your efforts make any difference?"

The young man looked down at the small starfish in his hand and as he threw it to safety in the sea, he said; "It makes a difference to this one."

The poorest of the poor at the highest level in 35 years

20 million or 6.7% of Americans are classified as the poorest of the poor according to new census data. The poorest of the poor are defined as those people who make up the lowest 50% of the poverty level.

This means an individual income of 5,500 and an income for a family of four of 11,100. Detroit, Grand Rapids MI, and Akron OH are some of the areas with the highest levels of the poorest of the poor.

Source: http://www.pbs.org/newshour/bb/social_issues/july-dec11/poverty_11-03.html

This is very sobering indeed. This and another article I was reading by worldhunger.org. It said that 925,000 people in the world suffer from a lack of food. http://www.worldhunger.org/articles/Learn/world%20hunger%20facts%202002.htm

If you are blessed enough to not be included in the poorest of the poor category in this country or in the world, be thankful! And don't forget about the people who don't have anything.

Tuesday, November 1, 2011

How To Save Thousands On Your Home Loan Payments

If you make extra payments that total 10 to 20% of your loan balance during the first few years of your mortgage, you can substantially lower the amount of interest paid during the loan period. For example, if you took a 30 year, $100,000 loan at an interest rate of 6.25%, you would pay a grand total of $121,000 in interest. If, however, you made an extra payment of $20,000 during the first year you would only pay $53,270 in interest payments. So, instead of spending $221,000 in total mortgage payments, you would only spend $153,270!

Find Out How Much You Could Save
Enter Loan Information Into An Amortization Calculator
First, use an amortization schedule calculator (available at http://www.amortization-calc.com/) to generate an amortization table. It would something like this:

Loan Summary - Total of Interest Payments and Total of All Payments
Based on this example, the total amount spent on a $100,000 home loan would $221,658. Interest on the debt would cost you $121,658

Amortization Schedule
Here is an amortization schedule for the loan amount in the example above. As you can see, at the start of the loan most of your annual payment goes toward interest. In year one, $6,216 goes towards interest and only $1,171 goes towards principle. At year 30, most of your annual payment goes towards principle and hardly any goes towards interest.

Scenario # 1: Paying Down $10,000 Starting at Time Zero
In this example, you would make a single extra payment of $10,000 immediately after getting your home loan. Doing this would knock your loan balance down to $90,000 and the interest/principle payment would start at year 8. What does this mean? Simply put, it means you would save a grand total of $41,753 in interest payments!

Scenario # 2: Paying Down $20,000 Starting at Time Zero
In this example, you would make an extra payment of $20,000 immediately after getting your home loan. Doing this would knock your loan balance down to $80,000 and the interest/principle payment would start at year 13. This means you would reduce your total interest payments by over $68,000. Instead of paying $121, 658 in interest you would only pay $53,270! Another benefit - the required time needed to pay off your loan would be reduced from 30 years to only 17!

Why Refinancing At a Lower Interest Rate May Not Be a Good Idea
Interest rates are great and it is very tempting to refinance, but make sure you run some calculations before you do so. When you refinance, you start the payment cycle over, which means you are also paying a higher interest/principle ratio. Using the example in Scenario #2, let's say you get a refinance offer with a 5% interest rate after the loan balance was reduced to $80,000. Doing this would start your payment cycle over at year one and would increase the 30 year interest total to $74,604. If you chose not to refinance in this type of circumstance, the remaining interest would only be $53,270.

Paying Your Loan Down by 10 to 20% Has The Greatest Long Term Payoff
While exact numbers depend upon your unique situation, you can probably save a lot of money. I encourage you to run the numbers. It may be worth scrimping for a year or two and saving a lot in the long run.

What If You've Already Been Making Payments for a Few Years?
If you've already been making payments for awhile, you can still save. Here is an example:

Monday, October 31, 2011

Governor Rick Perry's Weird, Drunk? Speech

Has Rick Perry been taking speech classes from George Bush?

What It Takes To Be A Hero - Providing Relief to Somalia Famine Victims

Sometimes it takes a little, other times it takes a lot, but something it always requires doing SOMETHING!
It hardly hits the main headlines, but there are about 500,000 people in Somalia under the threat of starvation, including 160,000 severally mal-nourished children. Unicef is now reaching about 1/3 of these children, which is great but there is so much more to be done. To make matters worse, the Al-shabaab militant group is making it very difficult for available aide to reach the people.

When there are situations such as this one, it's easy to become frustrated with its magnitude and not do anything. "Why bother" becomes the common sentiment. But not my friend, R.K. (he is a humble type, I won't use his full name), instead of standing by and watching he is doing something. Together with a group of his friends he has already put together and sent a container (~4,000 cubic feet) of relief supplies to help in this dire situation. But he didn't stop there, he is actively working on filling a second container. He is doing this while working 60,70, or 80 hours a week and with hardly any sleep. Now that, my friends, is a hero!

There is always something that can be done, just point in any direction and there will probably be people that need feeding, hearts that need mending, etc, etc. Do you want to make a difference? Would you like to be someone like R.K.? Someone who sees a problem and does something to fix it? Then do something! Anything!

Saturday, October 29, 2011

Ruins of Detroit Photos and Lessons for Living

I was looking through these photos of Detroit and it gave me a glimpse of what it once was. Even today, the ruins have a surreal beauty. You can imagine the hope and dreams of the people who worked to make the city one of the most prosperous cities in the world in it's prime. Many of these people have passed on and most of the city has passed with them.

These photos make me think about how fleeting life is and how important it is to focus on what is important. So many times, we as a society, are focused on getting to the next goal; graduating high school, graduating college, getting a job, getting married, having kids, getting the kids to graduate, saving for retirement, retirement and very quickly life has passed and with it the chance to enjoy everyday as a gift. In the words of Jesus, "Now listen, you who say, 'Today or tomorrow we will go to this or that city, spend a year there, carry on business and make money.' Why, you do not even know what will happen tomorrow. What is your life? You are a mist that appears for a little while and then vanishes."

So enjoy today, but in so doing don't forget about the promise of eternity. As one of my favorite quotes says, "Dream like you'll live forever, live like you'll die tomorrow."

Photos of the Surreal Beauty of the Ruins of Detroit