Debit Transaction Primer

Competition, of course, usually forces prices lower. But for payment networks like Visa and MasterCard, competition in the card business is more about winning over banks that actually issue the cards than consumers who use them. Visa and MasterCard set the fees that merchants must pay the cardholder’s bank. And higher fees mean higher profits for banks, even if it means that merchants shift the cost to consumers.

Interesting story on signature vs. pin debate. This article analyzes prepaid considerations.

LASER and GLOBAL ALTERNATIVES

“Investors over the last few years have suffered from diversification-deficit disorder, [...] [thinking] they’re getting diversification from putting their money in large- and small-cap stocks, value and growth strategies and international and emerging markets. But the fact is that all of those went down last year.”

An interesting philosophy that may work as an auxiliary vehicle for investment objectives.

Health Insurance

“When you’re self-employed, you’re straddling two distinct markets: the individual and the group market,” notes Janet Trautwein, chief executive of the National Association of Health Underwriters, an organization of health insurance agents, brokers, and consultants.

Those two markets vary depending on where you live. And so, if you are self-employed and in the market for a new plan, or you need to upgrade an old one, you should learn about the rules in your state…

Basic information; however, still useful. Do not forget disability insurance.

Asset Allocation

To some, stocks are irresistibly cheap right now. The price-to-earnings ratio on the Standard & Poor’s 500-stock index is 12 to 13, lower than its historical average of closer to 17.

Skeptics [...] argue that the March gains were nothing more than a suckers’ rally — a brief respite before another, even bigger roar of the bear market.

Speculation abounds regarding where things are headed next. Some believe that as ‘history rhymes’ the best bet is to stick to fundamental investing principles. Others disagree, arguing that the rules have changed and/or the United States (stock market, economic system, etc.) has entered a period of inevitable decline.

Whatever your worldview, the larger issue though is asset allocation. Proper asset allocation is arguably the most important factor for the average portfolio; indeed, even for the well-heeled, as diversification could have helped avoid the significant hits some took recently as a result of fraud and other bad bets.

Discount Brokerages

Smaller brokerages are facing increased pressure to increase their revenue or sell themselves to larger competitors like TD Ameritrade, E-Trade Financial Corp., Scotttrade Inc., Fidelity Investments, and Charles Schwab Corp., which control 96% of the global discount brokerage business. - American Banker, 14 January 2009

Are you ready to move beyond your 401k and Roth IRA contributions (perhaps invested in mutual funds or tracking some index) and begin to choose individual stocks? The above are not the only options for individual investors (see Zecco or TradeKing for example); however, they form an excellent starting point.

Today’s selloff underscores one of the advantages to having available funds in a brokerage account.

Managing Credit Cards

How well do you manage your credit cards? When used properly, credit cards can provide a short-term zero interest loan to finance purchases, leave a trail that allows you to track your spending, as well as offer protection against fraud, extend a product warranty, and give you an opportunity to qualify for rebates and other rewards.

Although they are a much better choice than using a debit card, when misused credit cards incur expensive fees and can damage your ability to move ahead financially.