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Personal Finance

Rough Morning on Wall Street

June 29th, 2010

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The opening few hours on Wall Street today were marked by a steep drop in the DOW, continued worries about the global recovery, and a rise in the dollar. Oil fell as the dollar appreciated and investors flocked to the relative safety of the dollar as the Euro continues to show weakness in the short term. Stay tuned as we will continue to follow the market throughout the day.

Stephan Tavernini
Preferred Financial Services

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Financial Regulation Bills reconciled headed for Final Vote

June 25th, 2010

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Andover, Massachusetts June 25th 2010— When President Obama supported new rules for the financial sector after the 2008 meltdown a wide variety of changes were proposed. Over the past 2 years both the senate and the house of representatives have created and passed bills that are aimed at fixing and regulating the issues that led to the Financial Meltdown in 2008. Early this morning the two different versions were reconciled and a new bill was created with parts from both versions. All that now remains for this bill to become law is a final vote in both houses as well as the Presidents signature. If everything goes according to plan, America could see the most sweeping reform of the financial industry since the 1930’s by the end of July. I will keep you posted on the progress over the coming month, stay tuned!

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/ .

Contact:

Stephan Tavernini

Preferred Financial Services analyzes the recent 33% drop in new- home sales….

June 24th, 2010

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Questions to Ponder while reading:

Have you noticed any uptick in the real estate market in your area?
Were you one of the millions that bought a house at its peak value and are now stuck in it with no way out?
Where do you see the housing market going over the next few months?

Andover, Massachusetts June 24th 2010— The housing data for May has been released and the data paints an even bleaker picture than anticipated by the government and private analysts. The Commerce Department reported that the sales of new homes plunged 33% in May from a month earlier to the lowest level recorded since record keeping began in 1963. While this report is obviously bad news for the recovery currently taking place it was not unexpected and the Fed Chairman continues to refute the belief that a double dip recession is still probable.

The new homebuyers tax credit expired at the end of April and economists generally agreed that we would see a steep drop in new home sales. The reason for this is because the tax credit did not create new demand for homes but instead it moved the demand. As expected, once this “free money” vanished new home sales plunged. Since the economy remains fragile and unemployment remains stubbornly high most experts do not believe that the housing market will recover to pre recession levels for a long time. To encourage more lending the Fed continues to keep interest rates at record lows making it very cheap to borrow money. But, until the factors that impact average Americans including job and wage growth improve, we do not anticipate any sort of rebound in the US housing market.

So why is this new data really important? Because the housing sector is a huge part of the US economy and spurred the record growth of the last decade. As home values rose people were able to tap into the equity in their home which allowed them to purchase many of the durable and luxury goods that helped the US economy expand at a healthy clip. As home values plummeted the demand for them did as well. New construction came to a standstill and this impacted a huge part of the economy. Banks felt the pain through foreclosures. Home builders and the entire construction industry felt the pain due to the low demand. Even manufactures of cars, RV’s, and other expensive goods felt the pain as the cheap equity vanished and consumers couldn’t afford to take on more debt. The end result of all of this was mass layoffs as demand created a glut in supply for almost everything and forced the suspension or closure of many factories and offices.

In my opinion I predict a gradual housing rebound that will take a few years to reach the pre recession levels. I do believe that everything is dependent on the jobs market. If people can find work and make money they will be able to spend more again, which will have the trickle down effect that the country needs.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/ .

Contact:

Stephan Tavernini

Preferred Financial Services analyzes and reviews the gasoline price trends for the summer….

June 23rd, 2010

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Andover, Massachusetts June 23rd 2010— As usual the American public is watching the price of gas as summer kicks into high gear. The following two months are the busiest on the nation’s roads and Americans spend more on gas in the summer than at any other time during the year. The price of gas is even more relevant this year as this variable cost can really impact the budgets of American families nationwide.

The price trend over the past few months has been down but this appears to be changing just in time for the 4^th of July holiday weekend. Throughout much of April and May prices dropped as the oil markets were shaky due to the Greece Debt Crisis as well as continued uncertainty over the strength of the world economic recovery. However, the average price of a gallon of gas has risen 4 cents in just the past week and the general consensus among economists is for the price to settle around $2.90. The current national average is $2.73 with higher costs out west and the lowest costs being found in the Midwest.

This price rise and the expected increase over the next 2 months can be attributed to a variety of economic and environmental factors. The European debt crisis has faded and manufacturing data from the US and China indicate the recovery is moving ahead though still at a slow pace. The price of crude oil generally rises as economic outlooks improve so we should see a continued rise in the price of crude oil as the economy recovers over the next few months and continues to grow. The oil leak in the gulf is also starting to impact the price of oil for a variety of reasons. Oil is traded as a commodity on the open markets just like stocks so the price can be heavily influenced by non economic factors such as people’s disgust with Big Oil after the leak. The temporary ban on deep water drilling in the gulf coupled with a possible delay of oil shipments into refineries along the gulf coast will lead to higher prices even if ships are not delayed and the ban is lifted shortly. This is because crude oil traders are making bets that the ban will last and that the oil slick could delay oil deliveries to the American Oil Hub along the Texas Gulf Coast. Although supply has not been impacted yet, the rise in crude oil prices indicates that investors are betting that the supply will be impacted by these events and this does not even take into account events such as hurricanes that can severely impact oil supplies nationwide.

Although prices are expected to rise to $2.90 per gallon, consumers should be thankful that we will not be seeing a return to $4+ per gallon anytime soon. So, is your growing gas budget impacting other parts of your household budget? Have you changed your driving habits or considered carpooling/public transportation? At what price will you consider making lifestyle changes? I would love to see your thoughts on this annually interesting topic!

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/

Contact:

Stephan Tavernini

Preferred Financial Services reviews some easy ways to save money on your summer utility bills…

June 23rd, 2010

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Andover, Massachusetts June 22nd 2010 — If you are like most households in the US, the summer months tend to increase your utility bills as everyone tries to stay cool and more time is spent at home due to school vacations and those much needed vacation days. Although it is almost impossible to eliminate the entire rise there are some easy to follow steps you can take as a homeowner or renter to reduce your monthly electric bills.

Many of these tips will seem obvious to most of you but for many these simple tips are often forgotten during the heat of the summer. The most obvious but also the hardest place to lower your bills is on your home cooling strategy. If you have an AC or even an army of fans in your home, you know that whenever these run the amount of power your home is using skyrockets. But, you can easily cut the time in half if you close and lower the blinds at all your windows during the hottest parts of the day. By doing this, you are able to lock in the cool air from the night before and minimize the amount of direct sunlight and heat your home takes in during the day. As the sun sets, open all your windows and utilize fans and air conditioners as needed. When you are planning out your meal schedule for the week (look for a separate blog post in the future on this) try to minimize your use of the oven or stove. Although you might not think the heat given off by these is significant, it has been shown to increase the use of fans and air conditioners which obviously increase your bills. Use a grill outside and you not only save money but can also enjoy a burger from the grill instead of the pan.

When you are looking at your entertainment rooms in your home there are many places to save money. If you are in the market for new appliances or entertainment products consider and look for Energy Star rated products as these use the least amount of energy. Keep in mind that any electronic device that is plugged into a power outlet uses power even when not in use. Use a Smart Power Strip as these shut off the electric current between your outlet and your device thus saving you money.

Some longer term ideas that increase the efficiency of your home should also be considered as these can lead to larger and longer lasting benefits. Using CFL bulbs not only drops your energy bill but they also last much longer, decreasing your overall consumption. Installing new energy efficient windows can slice up to 30% off your utility bills as they trap more cool air and keep out more hot air during the steamy summer months. And if you are really feeling up to a challenge consider planting new trees and vegetation around your home. The more shade your home is in, the less power is needed to cool it.

I hope these tips have opened your eyes to some easy money saving strategies as well as more long term ideas that you could start planning for. Do you already utilize some of these strategies? Have you said goodbye to your air conditioner over the past few years? I’d love to hear some strategies you have used to lower your power bill each summer!

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/ .

Contact:

Stephan Tavernini

Personal Finance

Preferred Financial Services reviews the newest credit card rules adopted by the Fed….

June 21st, 2010

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Andover, Massachusetts June 21st 2010— The Credit Card Reform Act signed into law by President Obama in 2009 had many parts to it that have been slowly implemented over the past year. The most visible changes so far have been with your bill statements which now include a graphic illustrating how long it will take you to pay off the balance in full when only paying the minimum. It also tells customers how much they should pay each month to eliminate the balance in a fairly quick 3 years. On Tuesday some new rules were adopted that were in the bill passed by congress last year.

The new rules will impact how customers will be effected by excessive late payments and other penalty fees. In the past there were no limits on how big of a late fee penalty creditors could charge. This new rule which goes into effect Aug. 22 will limit any penalty to 25$ per month. The rules also ban the charging of a penalty fee in excess of the amount owed. This will eliminate the practice of charging 50$ in penalty fees for a 20$ bill. These rules as well as some others are all meant to eliminate the most aggressive and unfair fees which creditors have been able to charge in the past. Ideally, rules such as this will in the future no longer be under Fed Control. The financial regulation reform bill being debated in congress currently has a provision in it which will create an entirely separate agency of the government devoted to protecting consumers from unfair business practices. This will allow the Fed to focus more on the macroeconomic issues facing the country and less on the day to day finances and issues that Americans are faced with.

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/ .

Contact:

Stephan Tavernini

Initial Claims for Jobless Benefits Rise

June 17th, 2010

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Data released by the labor department this morning indicates that first time claims for jobless benefits rose by 12,000 last week to a seasonally adjusted 472,000 Americans. This spike was not expected by analysts and could lead to a rocky day on Wall Street. Stay tuned for a complete review of what this means for the economy as a whole and how it could impact your family’s plans through the summer….

Preferred Financial Services gives a brief overview of payday loans and the different money options consumers have….

June 15th, 2010

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Preferred Financial Services gives a brief overview of payday loans and the different money options consumers have….

Andover, Massachusetts June 11th 2010— The ongoing economic troubles of America have forced many consumers to run up debt just to pay the basic bills each month. Americans continue to fear job loss and for those that have lost their jobs over the past couple of years the finance options available to them are very limited. Before the recession hit, Americans had many cheap ways of getting credit when needed with little to no background or income checks. This obviously helped Americans live a comfortable lifestyle while also helping the economy grow at a historically fast pace for much of the first decade of the 21^st century. However, this easy money also created a false sense of entitlement and security which quickly vanished as the economy and particularly the job market headed south.

As a result of the recession many Americans turned to Payday loan establishments which offer quick and easy to get credit to desperate Americans who cant afford to pay their bills. While it has helped some stay afloat it has also dragged many deeper into debt with no way out. Payday loan operations have been around for a long time but have only recently faced scrutiny for their very lucrative business model. Payday loan centers provide a quick and easy way for consumers to get money with a promise to pay it back once they get their next pay check. It is very easy and efficient with money being exchanged within a few hours. Obviously this is much easier than with a traditional bank or credit union and thus it has always been beneficial to some consumers. However, as the economy tanked more and more people started using these lenders because they could not afford their basic bills while waiting for their paychecks. Although they were able to pay their bills each month, many were not able to pay off the loan in full by the due date because the money from the paycheck had to be used for other bills. This domino affect continued until consumers literally owed more interest than principal.

Typical interest rates on payday loans vary between 15 and 25% but add up really quickly because this is not an APR, but instead the rate for the duration of the loan, typically whenever the next pay period is. So, a $1,000 loan for a month would cost the consumer $1,250 at the end of the month at a 25% interest rate.

Due to these incredibly high interest rates Preferred Financial Services discourages most consumers from getting payday loans as it is very easy to fall behind on the payments if the loans are not repaid in full by the first due date. Instead, we recommend looking for alternatives that are less costly. If it is a one time thing, family loans or a friend who can loan you some money are both great ways to get through a tough situation without paying exorbitant interest rates. If expenses can be cut or income can be increased payday loans should be avoidable completely as the real issue consumers should be focused on is their financial situation. If you are forced to get a payday loan, clearly your budget is out of whack and you are spending more money than you should. For many Americans this spending includes credit card debt, something we are experts at eliminating.

Are you currently in the process of paying back a payday loan? Or do you have some nightmare payday loan stories that you would like to share so the next American wont fall into a similar trap?

Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past seven years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/ .

Contact:

Stephan Tavernini

Personal Finance

Preferred Financial Services analyzes the rise in employees voluntarily leaving their jobs and what it means for the American job market….

June 11th, 2010

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Andover, Massachusetts June 11th 2010— The economy continues to produce mixed information on whether we have weathered the storm or are still in the middle of the deepest recession since the 1930’s. While there is positive news in manufacturing and Wall Street expectations for large firms in the coming year are mostly positive, there continues to be doubts whether the job market has turned the corner and can now consistently add jobs each month. The official unemployment rate stands at 9.7% while those working part time or not looking for work anymore make up another 10% of the work force. This means that the real unemployment rate is almost double the official rate. While this data is gloomy, there are signs of a turnaround that can not be seen in the unemployment rate data.

The past few months have seen the highs and lows of an economy struggling to escape a recession. In April, 218,000 private sector jobs were added while in May this rate dropped down to only 41,000, spooking the markets and creating a new fear that we are heading towards a double dip recession. However, analyzing some other data indicates that the job market is on a long term upward trend. Over the past few years the economy has lost over 8 million private sector jobs, many in industries that have no hope of returning to their pre recession levels. But just in 2010 we have added 982,000 jobs, leveling and eventually dropping the unemployment rate to its current 9.7%.

So you may ask, where is the good news indicating a job market recovery? Well, the data on those quitting their jobs voluntarily indicates that workers are becoming more confident in the recovery and are willing to leave their jobs with or without a new opportunity on the table. During the recession workers feared a job loss and thus stayed on in jobs they did not enjoy even while they were forced to take on more work as employers shed unnecessary workers. This increase in work coupled with a fear of termination led to very low morale in many firms and has created a whole wave of workers looking to move on to better opportunities. This new data shows the fear of not finding a new job has subsided and workers are confident enough that they can quit now. In April alone 2 million Americans quit their jobs, the highest in more than a year and a double digit percentage increase since January.

This rise in voluntary quitting has always been an indicator of an improving job market in the past. As quitting increases, lay offs drop which has happened over the past few months. Employees see the end of the recession even while many companies continue to operate like the recession is in full swing. This disconnect should lead to a continued rise in voluntary quitting until employers realize that they must appreciate and compensate their employees like they did before the recession began in 2007.

So readers, are you one of the 2 million that quit their jobs in April? Or are you still worried about your job as many sectors continue to see low levels of new hiring? Is this a sign the economy is out of the recession or are you still waiting to see actual hiring numbers improve?

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past seven years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/blog/ .

Contact:

Stephan Tavernini