Recent Posts


  • The truth about pay day loan interest

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    When you are stuck in a jam, the thoughts of a payday loan may be appealing but first think about the amount of interest that you will be paying back and if this will be a one-time thing. It is very easy to get stuck in a vicious cycle of returning to the payday loan company week after week and paying back hundreds more than originally borrowed. The annual percentage rate on payday loans is astronomical but many people do not realize this because it is usually borrow on a week or two-week payback period.
    The short-term payday loans can often have annual percentage rates that top 700%. At the annual percentage rate of 700%, the daily percentage rate is 1.92%. What this means for every $100 that is borrow on a payday loan you will be paying back $1.92 in interest. I know you are saying to yourself that $1.92 per day does not sound that bad but take a look at these examples; they may change your mind.

    You borrow $500 for a 7-day period in Noth Carolina. Now the $1.92 per day becomes $9.60 per day. $9.60 times the 7 days is $67.20 in interest to borrow $500. Now if you only are paid every 2 weeks and need that same $500 for 14 days that $1.92 a day is still $9.60 but times that $9.60 times the 14 days and you are paying back a whooping $134.40. It will cost you $134.40 to borrow your own money for a 2-week period. That payday loan doesn’t sound so appealing anymore does it?

    Compare the interest rates on your credit card with those of the payday loans and the look is much more reasonable. You have 30 days to pay back the money and the fees and interest amount is much more manageable. Even though you have 30 days, you can pay back the amount early. Therefore, we will use 7 and 14 days so you can see an accurate comparison. The following is an example of a cash advance for a typical credit card.

    You borrow $500 as a cash advance on your credit card. Most charge a 3% fee so there is $15.00. Now your annual percentage rate on the credit card for a cash advance is usually around 21% to 24%. Therefore, we will go with 24%. At an annual percentage rate of 24%, you get a daily interest rate of .07%. At .07%, you will pay $.07 per $100. For a $500 cash advance, you would be paying $.35 per day. That $.35 per day for 7 days is $2.45. It would cost you $17.45 to borrow $500 as a cash advance on your credit card for 7 days. That same $500 for 14 days as a cash advance would still have the same 3% or $15 cash advance fee. It would still be $.35 a day for interest. That $.35 time 14 days is $4.90. To borrow $500 as a cash advance for 14 days would cost you $19.90.

    That payday loan does not make much sense anymore does it?…

  • Changes to the Federal Tax Brackets & Law for the 2018 tax year?

    In the ridiculously large and wordy tax code each and every year small changes are made, but the average taxpayer is not affected by most of them. Despite of the fact, definitely there are some that has their effects even on average taxpayer, so I went to search out that what are those changes.

    So below I have written in detail whatever I found:

    There is a Change in the Income Tax Brackets.

    For Singles:

    10% Income Tax Bracket – From $0 to $8,350
    15% Income Tax Bracket – From $8,350 to $33,950
    25% Income Tax Bracket – From $33,950 to $82,250
    28% Income Tax Bracket – From $82,250 to $171,550
    33% Income Tax Bracket – From $171,550 to $372,950
    35% Income Tax Bracket – From $372,950 and onwards

    For Married Filing Jointly:

    10% Income Tax Bracket – From $0 to $16,700
    15% Income Tax Bracket – From $16,700 to $67,900
    25% Income Tax Bracket – From $67,900 to $137,050
    28% Income Tax Bracket – From $137,050 to $208,850
    33% Income Tax Bracket – From $208,850 to $372,950
    35% Income Tax Bracket – From $372,950 and onwards
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    For Married Filing Separately:

    10% Income Tax Bracket – From $0 to $8,350
    15% Income Tax Bracket – From $8,350 to $33,950
    25% Income Tax Bracket – From $33,950 to $68,525
    28% Income Tax Bracket – From $68,525 to $104,425
    33% Income Tax Bracket – From $104,425 to $186,475
    35% Income Tax Bracket – From $186,475 and onwards
    For Head of Household:

    10% Income Tax Bracket – From $0 to $11,950
    15% Income Tax Bracket – From $11,950 to $45,500
    25% Income Tax Bracket – From $45,500 to $117,450
    28% Income Tax Bracket – From $117,450 to $190,200
    33% Income Tax Bracket – From $190,200 to $372,950
    35% Income Tax Bracket – From $372,950 and onwards
    The Standard Deduction Has Gone Up.

    For single filers the standard deduction went up to $5,700. Last year this was $5,450.
    The standard deduction for joint filers will be $11,400, which was last year $10,900.
    The Amount You Can Save In Your 401K Retirement Account Has Gone Up.

    If you are under 50 then now each year you are able to contribute $16,500.
    If you are over 50 then now each year the contribution made by you could be $22,000.
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    The Amount You Can Save In Your Traditional or Roth IRA Account.

    If you are under 50 then now each year can now contribute $5,000.
    If you are over 50 then now you are able to contribute $6,000 each year.
    There is a Decrease in the Mileage Deduction.

    For business travel in the year 2008 you were able to deduct $.585 per mile, but in 2009 there has been a drop in the deduction up to $.55 per mile. If you take this deduction you just have to make sure that you are actually traveling for business.
    There has been an Increase in Gift Tax Exclusion.

    This year the gift tax exclusion is $13,000 which has been increased from previous year, as in 2008 it was $12,000. What it means is that now you can give up to $13,000 tax free to anyone else, up to a maximum of $1 million in your life. I wish I could give away that kind of money…
    The Earned Income Tax Credit Went Up.

    This year the maximum tax credit for low and moderate income workers and families with two or more children is $5,028, which has increased from $4,824 in 2017. On this credit income limit is now $43,415 for 2009, which has been increased from $41,646 last year.…