Facing your Financial First?

Like your first love, financial firsts can be exciting, exhilarating and a little scary. Here are some things to think about before plunging in;

• Applying for the first credit card: It is a good idea to apply for a credit card as long as you have the discipline to pay it off. Look out for 
• Cards that sell you a membership which means you get a card with a balance that you did not actually spend; 
• Cards that have annual fees unless they have a great benefit such as 1% cash back and in this case they should be from a reputable bank
• Cards with a very high interest rate. Even with no credit, it is possible to shop for a low interest rate. Click here to read about a woman who ended up with a 79% interest rate.  

• Renting the first apartment: It is important to research your area and find out about crime rates before renting an apartment. Many police departments have the crime rates posted on a city website and is readily available. It may also be useful to use a free apartment locating service because they are usually familiar with the reputation of the complex. They also help you shop around for the best deal. Make sure to visit your potential home at night before you sign the lease.    
• Buying the first car: If you can, try and save the money to buy your first car. If this is not possible apply for a car loan from a credit union which will usually have a lower interest rate. Most car dealers are willing to finance the car but at a much higher rate. Calculate how much you will spend on the car and make sure it is not so much more than the car is worth. Do not be left holding the bag. 
• Buying the first home: This is a major undertaking and need lots of research. Give yourself a year to learn as much as you can about loans and the housing values in your area before making the purchase. Many counties have free home buying seminars that are usually helpful. Click here for a great article on how to buy your first home. 

While this is a daunting task, there are many resources that can help you through the process. Here is a great article on financial first's on forbes.com. This website is a great financial resource. 

Here's to successful financial firsts that will hold positive memories for a long time to come. 

Five things you can do to build your credit

To most immigrants credit is an unfamiliar concept. In the United States, having no credit is almost as bad as bad credit. It is important to understand how credit works because it is vital to a new immigrants success. Building credit is defined as taking some actions in order for lenders to trust you with loans. Here are five things you can do to build your credit.

1. Apply for a secured credit card from a major bank. A secured card requires you to deposit some money in a savings account to back the credit they extend. Avoid any cards that have an application fee, an annual fee or a very high interest rate. You can convert your secured credit card to an unsecured card within 1-2 years. You can also apply for a credit line increase after 6 months to a year to increase your debt ratio. Click on this link for more  information on the debt ratio. 
2. Use the credit card to pay your regular bills and pay it in full or almost in full every month. At the beginning, you may leave a small amount to pay off in future months as long as you remain diligent in keeping it small. If you have a problem paying any interest then you can pay your balance in full every month without affecting your score. You get a better score by using a smaller percentage of the credit that has been extended to you. 
3. Open an account with a credit union. There are many that do not require any special membership. Use this credit union locator to find a credit union near you. Apply for a credit union loan to buy your first car (even if you have cash to pay). Make sure there are no penalties to pay off the loan early if you have the cash. If you have some cash to spare, you can open a certificate of deposit that earns interest and borrow your car loan against it. Do some research on interest rates to make sure you are getting the best deal. I am not an advocate for car loans but this step will help you build your credit by showing that you are paying an installment loan on time. 
4. Make all your payments on time. A single missed payment has a negative effect on your credit score especially when you are building your credit. Setting up automatic payments with your bank is a great way of making sure you never miss a payment. 
5. Apply for one more credit card such as a gas card or department store card. Some good examples are gas cards or a Target card. Be disciplined in your buying and buy only what you need. Because these cards typically have higher interest rates, pay off the balance every month. 

These five ways will help you get on your way in the credit world and allow you to leverage and build wealth. Here are some great financial resources for your journey

http://asklizweston.com/

http://20smoney.com/

http://www.getrichslowly.org/blog/