Futon Bunk

If you know you could write off credit card debt and loan debt would you? A lot of people wouldn't. Many people see it as unethical to wipe off debts they have incurred from over spending and believe they should pay back what they owe, which in some senses the correct thing to do. We have all overspent at some point in our lives on useless things we don't need, especially over the last few years in the build up to the recession where you couldn't walk past a bank or building society without them trying to drag you in and lend you some money.

I suppose it all depends on perspective and how we view the people that lend us the money i.e. the banks and loan companies. But first we still need to answer the question; Can you actually write off credit card debt?… Well the answer is yes, and unsecured loans too. You are now asking how can this be possible?' We'll come to that in a minute. First let's take a look at how ethical the lenders are first.

How ethical are the banks?
Well now lets see You only have to turn on the television to hear about another bank being bailed out with tax payers money while BILLIONS are still being paid out in bonuses to high flying directors while people are losing their homes. The greed of the banks started the recession and it's the taxpayer who has to pick up the pieces as usual. The recession may be officially over but Britain still owes over 1trillion and it's not going to be repaid over night, which means the cost of living will rise over the next few years and our grandchildren will inevitably take some of the burden. And it's all down to the greed of the banks

One heartening development on the global financial scene is that it is being shown that coordinated international pressure on countries which fail to regulate against financial malpractice can have an impact. Although to be highly effective it does seem to need be backed up by some form of economic sanction or threat of sanctions.

One area where this has been particularly true has been the crack down on money laundering. While it is war against drugs rather than corruption that propels these campaigns, money laundering is vital to the bribery process. Action against money laundering is beneficial to the anti corruption movement. In almost all cases of international corruption those bribed usually need to have the 'dirty' money deposited in banks offshore or in countries associated with banking secrecy. The reasons for using such banks vary, sometimes to avoid detection but usually to allow the money to be spent outside the home country.

This situation may seriously hinder the effective implementation of OECD Convention on corruption as well as the fight against organised crime and money laundering.

Perhaps the most encouraging change within the Western European region has occurred in Switzerland. The heads of the big Swiss Banks - the legendary Gnomes of Zurich - once noted for their peerless discretion -have come under pressure to open up their books where their accounts are believed to be used in serious crime.

The initial impetus for transparency came from the belief that huge amounts of money deposited in accounts in Swiss Banks by Jewish people who were later murdered in the Holocaust was being withheld by Swiss banks shielding behind banking secrecy laws. The Swiss government overcame their longstanding reluctance in 1995, allowed these allegations to be investigated and required Swiss banks to assist. But the Swiss government, under growing pressure from outside, has extended the precedent and required banks to act where there are clear moral and legal issues at stake.

When exactly does the term life insurance effective begin? That's a great question with far reaching implications if benefits are triggered while in the application process. Let's take a look at effective dates and the other potential clauses that are common for life insurance policies.

To determine the effective date, we need to look at another fancy insurance term called “offer and acceptance”. Keep in mind that the application and policy itself are contracts between you and the life insurance carrier. With life insurance, offer and acceptance essentially speaks to the fact that both parties agree to the contract. The applicant confirms his/her agreement by completing the application and submitting an initial premium amount. The carrier, after completing the life underwriting process, will send formal notice of approval which is the company's agreement to the contractual terms and obligations of the specific life insurance policy. The “offer” is the applicant's submittal of signed and completed application plus premium. The “acceptance” occurs when the carrier agrees to the coverage and issues an approval of the terms. The carrier is accepting the applicant's “offer”.

What if the applicant submits the application but not premium? A common question we hear with insurance is why premium needs to be submitted up front before the carrier makes a decision. It is precisely due to the offer/acceptance clause of the insurance contract described above. Without the premium submittal, there is no “offer”. In this case, the carrier makes the offer if it issues a policy and this policy is received by the applicant. “Acceptance” only occurs when the applicant sends the corresponding premium.

Let's be frank. The term life insurance application is not exactly a fun process. We rank it slightly worst than health insurance application but considerably better than mortgage application. Somewhere in the nasty middle. Let's take a look at some pitfalls and problems to avoid on the dreaded term life application.

The biggest concern is to leave off medical information or history on the application. Some applicants will say “well that's not very important” and they dismiss some issue and do not enter it on the application. Let the life insurance underwriter (person at insurance carrier that determines eligibility) make that determination. If you do not include information on the application, your insurance can be rescinded which is a technical term for cancelled after the fact. This is bad in that it usually comes up when there is a claim and the carrier finds that health history was not made apparent to them during the application process. It defeats the purpose of securing term life insurance protection if that protection is made void by missing information. This also goes for people who intentionally leave information off in order to secure coverage or get better rates. What's the purpose of obtaining coverage that might not be valid when the need actually occurs to trigger benefits. It's a losing game and after seeing the negative consequences in the past of missing information, we strongly recommend against it.

Another problem that occurs is entry of vague or incorrect information, especially in the life beneficiary section. We wrote an entire section just on beneficiaries to drive home the point that this is a crucial part of the application. A quick refresher… Be specific as to the person (don't use words like “spouse); as to how the benefit will break down (use percentages instead of dollar amounts); as to secondary and other beneficiaries (in the event the primary beneficiary is unable to collect or as passed away). You want to avoid the benefit going through probate and the accompanying estate taxes/conflicts that can result.

A few months ago, my husband (Tim) and I heard a sermon that really got us thinking. The message was about your financial life and how to get from where you are to where you want to be. I am a note taker and so I carefully recorded everything that was said so I wouldn't miss anything. We have been married for 7 years and have 3 little girls. I am a stay at home mom and my husband works from home. We are very blessed and are always looking for insight on managing our finances. This summarized where we want to be to a "T" and we thought the idea was worth sharing.

When you stop and think about it, there are really 5 things you can do with your money. You can:

1. Spend it
2. Pay off Debts
3. Pay Government/Taxes
4. Save it
5. Give it away

Most people do it in that order too. I know for us, we have certainly been there. Spending all you have, or worse, spending more than what you have and finding yourself in debt is a bad place to be. Debt becomes a vicious cycle and the stress it creates can be paralyzing. There is hope. You really can begin to do the 5 things in REVERSE order and that is certainly our goal and we hope it will be yours as well.

Did you know that money is the #1 issue that most couples argue about? Whether it's spending, saving, budgeting or giving, couples who don't have a financial plan are bound to get themselves into trouble. Dave Ramsey is a well-known author who offers great insight into managing finances. We know so many people who have gone through his "Financial Peace University" and have benefited greatly from it. There is also an organization called Crown Financial Ministries. I've heard it described as giving you the "heart" for managing your finances and Dave Ramsey's plan being the "how to".