Lending money to strangers online could be pretty silly or pretty awesome depending on which website you’re on.

I first read about Kiva.org from Ramit’s Friday Entrepreneurs back in August of 2006.

First impression? Pretty neat. Bookmarked it, fell asleep, and soon forgot about it.

Yesterday, with an In-N-Out burger in one hand and a greasy mouse in another, I trolled Bloglines and came across another pf blogger’s post on Prosper.com — which I promptly typed into Wikipedia’s search box to see how Prosper has changed since launch. (Anyone else type things into the Firefox search box while they read articles or watch TV?)

While reading about Propser’s shady handling of its online forum, I noticed the “See also” link to Kiva in the Wikipedia entry.

“Hmm, I wonder how’s Kiva coming along?” I thought to myself as I click on the link and flicked the onions out of my burger.

Minutes later, before I even finished my juicy burger and strawberry shake, I found myself lending money to strangers online — all it took was only a few minutes.

Microcredit what?

Kiva.org is a non-profit organization that partners with microfinance networks across the globe to provide microcredit to low-income entrepreneurs. In gist, microcredit is the lending of very small amount of loans. It’s like letting your friend Bob borrow $50. Except Bob isn’t going to use the $50 to buy a PS3 game — he’ll be using the $50 to further his business and create more wealth.

Easier than Buying that Beanie Baby Off eBay

Lending money to various entrepreneurs across the globe is incredibly easy. You browse through the list of lenders by clicking the “Lender” tab, pick the listing you want to lend to, select your amount, click “Loan Now” put in your PayPal info and you’re done.

Borrower Listing Page

Lender’s Profile Page

After you’ve extended the loan, you will receive email updates in regards to the status of the loan and the progress of the business in which you’ve extended the loan to.

The flow of money is fairly simple. You extend the loan via a credit card transaction; Kiva collects the fund (100% of which goes to borrower, since Paypal is waiving transaction fee); the funds are transfered to the field partners which administers and collects the loan repayment; you receive your repayment into your account and you can withdraw the amount or lend to another borrower.

Not Really a Handout

Loans extended on Kiva won’t generate interest for the lenders (although the microfinancing field partners of Kiva do charge interest to borrowers), thus if you lend money on Kiva — you will only get your principal amount back. There is of course the risk of the loan defaulting, in which case you may lose your money.

With those in mind, why should anyone lend money?

Kiva’s pitch: By choosing a business on Kiva.org, you can “sponsor a business” and help the world’s working poor make great strides towards economic independence. Hence, “loans that change lives.”

My opinion? Sounds good to me. On one hand, you’re helping someone. On another hand, you’re not exactly giving a handout — these are loans that should be repaid, after all. Plus, more often than not, these loans are a means for them to produce more wealth and value — not to pay off debt incurred from excessive shopping.

Thus far, Kiva has had a pretty amazing repayment rate of 100%, an on-time payment rate of +99%, and the microfinance institution that Kiva partners with are required to meet Kiva’s due diligence standard.

Microfinancing isn’t without problems, borrowers can easily use their funds on transactions other than the ones stated, and microfinance institutions can’t always find the perfect borrowers. Still, as a website that utilizes the Internet to increase the reach of funding for microfinancing institutions across the globe, Kiva is doing a pretty spiffy job.

Related Links

• Kiva.org on PBS Frontline
• Where to Microfinance?

This is an in-depth review of myFICO FICO scores provided by Fair Isaac. If you’re purchasing a FICO score, don’t forget to check for myfico promotional code before you buy! This review was written when myFICO.com previously offers Experian FICO scores to consumers, unfortunately as of recent development, an Experian FICO score can no longer be purchase at myFICO.com.

FICO scores are a lot like lottery tickets. You’re paying for a bunch of numbers that will become meaningless (sort of) in the future. One of them can potentially save you thousands of dollars, while the other is a complete utter waste of money.

What’s a FICO Score?

There are about seventy-two hundred articles about FICO scores on the web (yup, counted). If you’ve read at least four hundred of these articles on FICO scores, you can skip ahead and go straight to the review. If not, you’ll be able to pick up some basics on FICO credit scoring by reading this explanation section.

FICO scores are a set of three numbers that represent your credit worthiness; they are computed by the Fair Issac Corporation. Each of the score is derived by your credit history from each major credit reporting agency: Equifax, Experian, and TransUnion.

Because your credit history may vary from one credit reporting agency to the next, your FICO scores may be different from one another. The scores will also change when the information in your credit report are updated as time pass.

Thus, FICO scores are a type of credit scores. For the banks and lenders that do use FICO scores, your scores can affect the bank’s decision in whether to extend you credit and the amount of interest you’ll be charged. The FICO score ranges between 300 and 850. The higher the numbers, the better your credit worthiness and the more likelihood you’ll be approve of credit and the more favorable your interest rate will be.

In a nutshell, understanding your FICO score can help you understand the type of loan you should be able to acquire. This means if an auto dealership’s finance department is giving you an unfavorable interest rates, you’ll know it. Understanding how some factors influence the score can also help you obtain the best possible score before you apply for a mortgage, in which a large difference in score can mean an extra percentage or two in the mortgage loan — potentially thousands of dollars in the long run.

FICO Scores = Credit Scores, but Credit Scores ≠ FICO Scores

This is where it gets a bit silly and confusing. You should realize that although FICO scores are a type of credit scores, not all credit scores provided out there are FICO scores. The exact algorithm used by Fair Issac in computing FICO scores are a closely guarded secret, and because of this credit scores from other sources are not the same as FICO score, even if they are similar in numbering ranges.

Getting a “FAKO” score (a score not computed by Fair Issac) from Company X is mostly a waste of money. If a particular lender does not use the score you obtain, then your scores are pretty much worthless. It’s like running to the creditor saying: “But Bob says my credit score is 1,000!” Pretty silly when the creditor doesn’t know or care who Bob is.

Fair Issac claims that 90% of the largest U.S. banks use FICO scores. Whether your actual prospective lender uses FICO score as a factor or not is up to them, though at the end FICO scores are a good indication, and one of the industry standard in knowing where you stand in terms of credit worthiness.

myFICO FICO Scores Review

myFICO.com’s FICO Deluxe / Complete

Price: $47.85 (one-time purchase)

Promotional Code: FICO25 for 25% OFF

What you get:

- All 3 credit scores & report.
- Viewable for 30 days from date of purchase.
- Explanation for factors affecting each of your scores.

Buying the score is fairly straight forward. You click on purchase, input the discount code, fill out your personal information and pay Fair Issac via credit cards. You’re require to open an account so you can log-in and view the scores and report, all standard stuff.

Before you receive your report and scores, you’ll be asked a series of question based on your credit history, to determine your identity. In the event that they’re unable to verify your identity online, you can call a number provided on-screen, in which a service representative will confirm your identity.

I. The FICO Scores

The website interface is pretty easy to navigate. Upon log-in, you’ll be presented with your FICO score and the date the scores are obtained. Next to the score is a spiffy certification-for-the-real-deal.

The Login Page

Clicking on each of the score will bring you to the FICO Score summary page. You can check out an example of such a page here. The FICO Score page explains in detail what the score means to you, it will basically tell you how good or bad your credit is, and how likely it is for you to obtain credit base on the scores. There is also a summary of factors that affect your score, in which the positive and negative factors are listed and briefly explained.Clicking on the “Top Positive Factors” and “Top Negative Factors” page will give you further details on the factors that affect your score. For FICO score newcomers, this page can be pretty informative, especially for those taking steps in improving their credit.

Your FICO Score Page

How Lenders See You Page

The “How Lenders See You” page is another informative page, giving you a low down of how you are seen in the eyes of lenders. This includes your risk factor and a ball park interest rate for various different type of installment loan. Examples listed are a 30 year mortgage; a 15 year home equity loan; and a 48 month auto loan.

The interest rate numbers provided on this page appears to be up-to-date and sourced on the day you purchase the score, as my numbers are clearly higher than the one shown in the example page. Also in the “How Lenders See You” page, Fair Issac provides you with an extreme example of how your credit score can affect the rates you pay: If you score dropped from 792 to 510, you would pay $464 more each month in interest.

The last tab within the FICO score section is the “FICO Score Simulator.” The simulator provides an estimated score base on a list of what-ifs, such as “what if you pay down your balances on your credit card.” You can also click on the “simulate best action” button to see which action might result in the best improvement of your score. The simulator is pretty basic, with no-brainer what-ifs such as “what if you max out your credit cards.”Overall, the FICO score section is informative. Each of the information presented to you is accompanied by a decent amount of explanation to help you better understand the factors that influence your score.

II. The Credit Reports

The credit reports provided by myFICO.com are woefully basic and lacking in information. The first few tabs are self explanatory. “Negative Items” show things such as bankruptcy, collection, and delinquencies — if any. The “Inquiries” section shows the number of recent inquires resulting from you apply for credit. You should note that shopping for the best auto or home loan within a certain time period will not result in multiple hits of inquires to your credit report.

The “Accounts Summary” page simply lists a few stats that are important. You’ll see the number of accounts you have, the number of accounts with balances, number of accounts that are negative, the total balance on all accounts, and the length of credit history.

Clicking on each of the accounts listed will show you a wee bit more information on each account. You will see information such as the type of account (revolving or installment), the credit limit or high balance on the account, the minimum monthly payment or the terms of the account.

There isn’t much that can be mentioned about the credit report section of myFICO.com. Compare to the individual reports you receive straight from each credit reporting agency, the report shown on myFICO.com is a definite reader’s digest version.

Take the inquiries section for example. In the myFICO.com report, you only given the hard inquiry information, while soft inquires are not listed. Compare to a report from a credit reporting agency, the credit reporting agency may show you all the soft inquiry within the past year.

Because myFICO.com utilizes one interface for all three different report, some of the information provided (such as credit limit and high balance) may be unclear and difficult to compare. To really get a clear look at your credit report, especially for the task of fixing potential mistakes, you are much better off requesting each individual report from each of the respective credit reporting agency. Don’t forget they’re available free once per year.

III. Different Scores?

As you can see from the picture above, my Equifax and TransUnion score are different by about 28 points — although a fairly significant amount in terms of FICO score, for my particular situation the score difference aren’t too striking.

One of the advantages of obtaining your three FICO score is the ability to quickly see the possible differences in your credit report. As the scores are computed base on the credit report from each perspective agency, the resulting score can show you which report may be similar and which report may differ greatly.

In my situation, the extra 28 points can be attributed to one authorize user account that’s shown on the Equifax report, but not on the TransUnion report. The inclusion of this one account resulted in an extra $15,000 difference in credit limit, and also a difference of almost 11 years in credit history. A pretty significant difference!

If you want to read more about the importance of different credit score, you should check out the related post linked below.

IV. No Report, No Scores

There’s a certain caveat you should know about getting your FICO score from myFICO.com. If for whatever reason a credit reporting agency has blocked off your ability to receive a credit report online (thereby forcing you to request the report by snail mail), Fair Issac will also be unable to get you the score from that particular agency, since the scores are dependent upon the information within the report.

This is the reason why my scores from Experian are not shown above, because Experian has recently prevented me from obtaining my credit report via the online method.

When you try to purchase all three score in a situation like this, you’ll receive an unable to confirm identity message from myFICO. If calling the number provided doesn’t resolve your problem, you can simply try ordering each score individually to see which of the agency may be the source of the problem.

V. Not The Only Factor

You should know that although FICO scores are one of the more widely used scores by large US banks, it is NOT the only factor a lender use to determine your credit worthiness! Just because you have ass kicking FICO score does not mean you’ll never be rejected for credit. Besides other factors such as income and actual credit history, many large banks also have their own scoring system in determining credit worthiness.

Overall Impression and Conclusion

The expensive price tag, when compare to other available credit score can be attributed to the fact that FICO scores can mostly only be obtained from Fair Issac. If you were already planning on getting your credit score, you should obtain them from myFICO, as scores from other sources may not pertain what-so-ever in the eyes of your potential lenders.

If you have never, ever, taken a peak at your FICO score before, the price tag may be a fair deal — especially if you read all of the information provided to you. The FICO Score pages do a great job explaining the details of a FICO score, specifically, your FICO score.

For the people that are improving their credit, scores from myFICO can be a great indicator of how well you’re doing in your credit fix. You should note that fixing bad credit takes time, and forty bucks can add up quickly over time; so you should request your score in moderation, and only when you know significant changes have been made to your credit history (e.g. bankruptcy finally removed from your credit report).

Other people that will find FICO scores extremely helpful will be those shopping for a home or auto loan. Knowing your FICO score will insure that you’re less likely to accept unfavorable loan terms due to lack of information.

If you already know your FICO score and have not made any significant changes to the way you manage your credit, than you definitely don’t need to obtain your FICO scores.

If you’re buying the FICO scores for the credit report, you will be sorely disappointed. The information provided are basic at best — they’re more of a tacked-on bonus, which makes the scores themselves even more expensive. Remember, you can always obtain credit reports for free once per year.

Finally, if you’re running a crappy personal finance blog and have finally ran out of crap to make fun of, and you decided to actually provide some information to your readers (specifically a review on myFICO.com), you will most likely have to shell out the dough for the scores.

Pros:

• Scores are the real deal
• Scores are more relevant compare to other offerings
• Great information for beginners
• Helpful gauge in credit improving process
• Helpful guide in shopping for auto/home loans

Cons:

• Come on, $47.85? (or $38.28 with discount)
• Too little credit report information
• At the end, just one of many other factors

Chances are, you have more than ten financial accounts. Keeping track of them is probably hectic, unless you have photographic memory; in which case, remember that time you opened the door while your parents thought you weren’t home?

Anyhow, lot’s of financial accounts, too much hassle to keep track of them individually.

What do you do?

In comes Yodlee, an online banking account aggregation service, which also happens to be utilize by many major financial institutions. Yodlee is free to sign-up and use, and the only reason why you don’t hear about them too much is because they do not market their product directly to the consumer.

The gist of it is really simple. You register for an account at Yodlee, add in your financial accounts, click the update button—and bam, all your account informations are updated and you are now in financial organization bliss.

Two Choice of Yodlee

Yodlee MoneyCenter

Yodlee Dashboard

There’s really no difference in features in the type of Yodlee you choose, except for the way the information are presented to you. If you prefer an all-in-one screen view, you should go with Dashboard, if not stick with the single format view from MoneyCenter.

How To Sign-Up With Yodlee

1. Head over to Yodlee’s Financial Application
2. Pick the format you like and click Log Me In
3. Click on the Registration link above the log-in
4. Fill in all your info and click register

Done deal.

Using Yodlee and its Features

Adding accounts is also fairly straight forward. Click on the Add Account Tab and type in your financial institution’s name to search for it, or click on the popular account tab to see if your account is listed there.

Types of accounts you can add:

• Banking Accounts
• Credit Card & Reward Accounts
• Telecommunication Bill Accounts
• Payment Service (PayPal) Accounts
• Investment and Insurance Accounts
• Loan and Mortgage Accounts
• And even web-based E-mail Accounts!

Yodlee contains a BillPay service, where you can make payment to some of the accounts you’ve added, such as credit card bills and cable service bills; pretty handy! Another semi-useful service is the Yodlee Financial Calendar, which allows you to see when the bills are due on a calendar map.

Yodlee BillPay

Yodlee Financial Calendar

Besides the features listed above, there is also a Net Worth tab that shows your net worth in a bar graph format. You can also check out the spending report, although it isn’t too accurate unless you actively manage the categories for each specific transaction. You’ll find that many of Yodlee’s features are similar to those of MS Money and Inuit Quicken.

Even More Yodlee Choices

With their recent update, Yodlee has been noted to be slow to access for some user. As you can tell from the above pictures, some of the sample accounts I added were having trouble updating. For those with significant access problem with Yodlee, you can try their service from various other financial institutions:

• CompassBank MyCompass (Yodlee 5.0)
• Harris TotalLook (Yodlee 5.0)
• National City My Accounts (Yodlee 4.0)

Of course, signing up service in these other institution will require you to trust your information with their database and security. If you’re a HSBC or Bank of America customer, you should check out HSBC EasyView and Bank of America’s My Portfolio.

Paranoid Users Beware

The problem with an financial account aggregation is that all your password and information for each of these financial accounts are stored in one central location. Not a good thing if you don’t trust Yodlee’s security capability.

There are a couple of things you should know about Yodlee though. First, many of the largest financial institution utilize Yodlee technology for their online account services. If you’re banking at Bank of America, Citi Bank, or HSBC—you’re already using Yodlee services. In fact, those respective banks probably offer a similar account aggregation service on your online account, powered by Yodlee.

Second, under federal banking regulations, you have quite a few rights when it comes to electronic fraud. As long as you’re up top of things and notify fraudulent activities fast (within two days), you’re only liable for up to $50. Within sixty days, the cap rise to $500. Anytime over that though and you’re sorta SOL.

Still Pretty Damn Convenient

Fact of the matter is, an online financial aggregator is flippin’ convenient. For me and many others, it’s well worth the small risk. There really shouldn’t be any big problem if you take basic precaution with your private information and be proactive about the security of your computer.

Without online aggregator service like Yodlee, life can be hectic. Let’s face it, no body likes logging into sixty different accounts everyday just to make sure their significant other didn’t blow all their money on Texas hold’em.

Related Links and Resources

• Why I Use Yodlee Account Aggregation from MyMoneyBlog.com
• My Second Love Affair With a Web Application
• Q&A on Yodlee from Fatwallet Finance Forum

If you’ve stumbled onto this review because you’ve been looking at high-yield online savings account, then you must have noticed the abundance of choices and options.

HSBC Direct started offering their online savings account back in 2005 with little fanfare, but they have since become much more well known through the years.  This is an in-depth review of the HSBC Direct Online Savings Account, with screenshots of account usage and bank transfer from over three years of account ownership.

You can read the entire review from start to finish, or skip all the way to the summary for a list of pros and cons.  If you have any feedback on the HSBC Direct Online Savings Account or this review, feel free to leave a comment below.

Account Opening Process

Opening an account at HSBC Direct should be a breeze for most people. You fill in the usual personal information and type in other information requested. HSBC’s opening application distinguished itself with a few convenient features:

1. You can save the application and finish it later
2. Different options for linked account verification

When you open an online savings account such as HSBC Direct, you will usually have to link the savings account to an existing checking account. To verify the linked checking account, most banks will usually do a two deposit verification method. In this method, two small trial deposit will be made to your checking account, which you later verify the amounts to confirm your identity as the account owner.

One of the account verification methods is an “instant verification” process, which simply requires you to input your online account information (the login & password) of the checking account being verified. The instant verification is limited to the Yodlee online banking solution, an online banking method that most major banks utilize.

The rest of the account opening process is smooth, albeit slow. Unlike ING Direct, which allows you to open an account without waiting for any mail — a problem with many online-only-accounts from traditional bank, is that the account opening process still heavily relies on snail mail.

HSBC has the same problem, but fortunately the mails were sent within a reasonable time period. You should expect to receive six separate mail piece:

1. Temporary login for online access
2. Temporary password for online access
3. Account number and ABA routing number
4. A letter informing you that the ATM card is on its way
5. The actual ATM card
6. The PIN for the ATM card

You will need all of the mail above, except #4, to have full access to your account. The time frame for the mail to arrive will vary depending on your location. It took about 12 business day for me to receive all the mail from New York to California. It’s understandable that this information was sent separately, as privacy and security is important — but HSBC can probably streamline the process better & faster.

Account Access and Interface

When I first got an account at HSBC Direct, the domain HSBCdirect.com was not setup yet — in fact, it wasn’t even called HSBC Direct yet. It took a bit of digging to find out where to login to access my account. Today, all you have to do is head to HSBCdirect.com and the link for account access will be on the front page.

The first page you’ll see when you login is fairly straight forward. You will be greeted by an Account Summary page, which gives you a quick summary of your account balance as of today. Click on the left picture below to see the Account Summary page.

The Accounts Detail page is self explanatory. You will see balance information such as bank balance, available balance, last state date, year to date interest, and the last nine transactions on your account. If you wish to view previous transaction, you will have to use the transaction search function, which allows you to search through different date and amount ranges. One feature that’s lacking is a daily update of interest earned for the month. You can click on the right picture above to see the Accounts Detail page.

You can also export your account data and specific transaction date ranges into three different file formats. HSBC supports Quicken (qfx, qif) and MS Money (ofx). Your account statements can be view with the eStatements tab, which also allows you to save & print the statement in pdf format.

Online Bank to Bank Transfer

This is the meat of an online savings account, the online transfer capability. Clicking on the Bank to Bank Transfer tab will bring you to an annoying Security Key screen. In order to create a Security Key, you will need your ATM card number and its PIN number, both of which will arrive via snail mail. In another words, you won’t have full access to your account until you receive both of those mail piece. You are required to use the virtual keyboard to input your security key. HSBC requires a certain length to the security key, so it can become quite a hassle to input the key. Click on the left picture below to see the Security Key interface.

Once you have input the security key, a new window will open up with the Bank to Bank transfer feature. In this page, you can add, remove, and transfer funds between accounts. The interface is straight-forward, adding accounts requires the usual two trial deposit verification. A great thing about HSBC’s Bank to Bank transfer is that it allows an unlimited amount of accounts linked. You can add your checking, savings, and brokerage account from various financial institutions. The Bank to Bank electronic transfer service is provided by CashEdge.

Be aware that some accounts cannot be linked to the HSBC Online Savings Account, such as the ING Direct Oranges Saving Account. According to HSBC, members of the CashEdge network can exclude themselves from being linked. Apparently ING Direct excluded themselves to be linked (an understandable action to prevent easy withdrawal of account funds to their competitors). You can click on the right picture above to see the Bank to Bank Transfer interface.

Bank to Bank Transfer Speed

Up untill this point, everything about HSBC Direct is decent enough. Unfortunately, there’s no such thing as a perfect banking experience, so here’s the drawback to the HSBC Direct account — the online bank to bank transfer speed. Compare to other competitors ACH transfer speed, HSBC’s transaction speed is ridiculously slow. Through my various transfer to and from various accounts, the transaction speed of HSBC is usually slower by 1-2 days, and at times, 3 days slower. Whenever I push a transfer from another source to HSBC Direct, the deposit will show within a reasonable 1-2 business day time frame. However, if the situation is reverse, and I pull the amount from that account to HSBC, via HSBC’s Bank to Bank transfer feature, the same transaction takes an extra business day or two.

There is a great HSBC Direct transfer speed experiment that can be found over at MyMoneyBlog.com. In the experiment, Jonathan conducted various transfer through different financial institutions. The result is quite interesting and correlates with my experiences with HSBC Direct. You should definitely check out Jonathan’s post for more information.

The lowdown on the transfer speed is that HSBC is probably keeping a day or two of interest through the ACH — interest that you’re not earning. When you utilize the Bank to Bank Transfer, you should pay close attention to HSBC’s transfer schedule, and make due sure you initiate transfer before the 8 PM EST cut-off. Looking at HSBC’s transfer schedule, the best days to initiate a transfer would probably be Sunday through Tuesday.

Customer Service Functionality

You can contact customer service via the Bank Mail interface in the online account, or by calling HSBC at 1-800-975-HSBC. The call center is 24/7, although the quality and availability of support will vary depending on the time called. Your best bet for non-emergency inquiry would be the online Bank Mail feature. Response time for my test questions were within a reasonable 4-8 hours time frame. Answers provided were thankfully not robotic responses. The response to my basic question about how-to use a function was written clearly and straight-forward.

Contacting customer service via phone definitely leaves a lot to be desired. The wait time at peak business hour can be quite long (over 10 minutes) and at times, you may reach a customer service rep that’s not knowledgeable on the HSBC Direct Online Savings Account. According to Gethuman.com, the fastest way to reach a human operator at HSBC is by calling 1-800-477-6000 — press 1, 3, then 0. It would be great if HSBC eventually introduces a specific number to reach operators that specialize in HSBC Direct specifically.

Overall Account Impression

As mentioned, HSBC’s questionable ACH delays can be a big turn-off to many, but in my opinion it isn’t a major issue for a savings account. It would have been great though, to use HSBC Direct as a central hub to transfer funds, thanks to the account’s unlimited account linking capability.

HSBC Direct’s APY rate is consistently competitive among other no fees, no minimum accounts. They have stay within the market’s rate, and at times have lead the pack. Although you are required to have $1+ to receive the current APR, unlike Emigrant Direct, your account at HSBC Direct will not be closed if the balance reaches $0. I’ve had $0 balance at HSBC without issue, but to be safe and avoid hassle, you should still leave a small amount in HSBC Direct.

If it wasn’t for the slow ACH transfer speed and a few other minor quirks such as the Security Key interface, HSBC Direct would be a pretty sweet high-yield online savings account. That said, HSBC Direct is still semi-sweet — like, kettle corn sweet.

Pros:

• Competitive high-yield rate
• No fee, no minimum, FDIC insured
• Unlimited account linking
• Decent account opening process
• Functional, error-free site

Cons:

• Slow ACH speed compare to competitors
• Hassle access to ACH due to Security Key
• Snail mail required for account opening

• HSBC Direct – Official Site
• HSBC Direct opening process
• HSBC Direct review – Blueprint for Financial Prosperity

The Total Money Makeover:
A Proven Plan for Financial Fitness

Author: Dave Ramsey

Publisher: Nelson Books

ISBN: 0785263268 – Hardcover, 244 pages

Dave Ramsey hates debt.

If I was debt, Dave Ramsey will smite me down where I stand.

Just like the authors of the other book reviews I’ve done, I’ve had no prior experience with Dave Ramsey’s previous work (I was illiterate till recently). The only reason I picked the book up from the library was because I thought the guy on the cover was Steve Jobs (turns out he’s not).

As I’ve mentioned, Dave Ramsey doesn’t seem to be fond of debt. There’s a good reason for that – he use to be in the debt hole himself. In fact, he was bankrupted. He went from fairly rich at 26, to fairly poor within a few years. After declaring bankruptcy, he took a hard look at himself and how he handled his money.

Ramsey started the second chapter of the book discussing the effects of denial on those with debt. He challenges you to take a look at your own financial picture, and examine if you’re in the hole or not. The book continues on with two very important chapter, specifically, the chapter on Debt Myths and Money Myths.

In Debt and Money Myths, Dave Ramsey lays out many of the common myth that can be often associated with debt, or general money matters. The Debt Myth chapter is basically focused on tearing down the often sold debt ideas within our society, while the Money Myth chapter focused on the financial mentality of people.

Here are some noteworthy ones:

Debt Myth: Make sure your teenager gets a credit card so he or she will learn to responsible with money.

Truth: Getting your teen a credit card is an excellent way to teach him or her to be financially irresponsible.

Money Myth: I’ll just file for bankruptcy and start over, it seems so easy.

Truth: Bankruptcy is a gut-wrenching, life-changing event that causes lifelong damage.

Money Myth: I can’t afford insurance.

Truth: Some insurance you can’t afford to be without.

Many of the debt and money myth are pretty solid, although I do question some of his debt myths. Specifically the anti credit card platform. One of the debt myth Dave Ramsey argues against is the fact that debit cards do not have more risk than credit card. I agree with that point, but he also failed to mention the broader protection afforded by credit cards. Of course, the benefits of credit cards can easily be overshadow by irresponsible usage.

Continuing on, the rest of the chapters lays out Dave Ramsey’s plans for attacking debt and building wealth, which he calls the “Baby Steps.”

The Baby Steps can be lay out as this:

1. Start an emergency fund of $1,000.
2. Pay off all debt fast using the “debt snowball” method (except mortgage).
3. Build emergency fund to cover 3-6 months of expenses.
4. Invest 15% of household income into Roth IRAs and other pre-tax retirement accounts.
5. Save for your child’s college fund
6. Pay off home early
7. Build wealth and give! (Mutual Funds & Real Estate)

Couple things about the baby steps. They’re pretty solid besides a few things. His college saving suggestions are all pretty dead-on, except for the out of place mention of serving in the National Guard as a means to pay for college. I have nothing against military service, but an important decision such as that should warrant more discussion, instead of a simple one sentence mention, as Dave Ramsey did in the book.

The methods to build wealth (or lack thereof) via mutual funds and real estate is also questionable. I understand that the book centers around debt reduction, so the wealth building portion of the book can be lacking – but suggesting mutual fund without providing more insight can be a bit misleading. If a person is not careful in his selection of funds, he can easily be losing money through fees. Not to mention the fact that many mutual funds have poor track records in beating the market.

The complaints (on Baby Steps) aside, Dave Ramsey’s method of debt reduction, although at times a bit aggressive, can be implementable. Each of the Baby Step he list are important aspect in a person’s financial life, and his emphasis on emergency funds are well appreciated. As you read through each of the chapter on the Baby Steps, Dave Ramsey explains the importance of each step and supplements his points with stories from real life families. This brings me to another problem with the book. Of the 244 pages, many of them are riddled with excerpts of stories after stories. In fact, the last few pages of the book contains even more Total Money Makeover stories. Showcasing result is fine and dandy, but too much of it can become unnecessary fluff.

My beef with the book doesn’t stop there, unfortunately. If you’ve read Dave Ramsey’s previous book Financial Peace before, you really don’t have to bother with this book. While I was reading The Total Money Makeover, I checked out some of his previous work so I can compare and contrast. It didn’t take me long to realize that The Total Money Makeover is simply Financial Peace repackaged, with plenty of fancy products supplementation. The Financial Peace University, My Total Money Makeover website, and the Total Money Makeover Workbook are all clear examples of excessive fluff.

It’s a bit silly to tell people to avoid buying into debt, and then have the last few pages of your book looking like a late night shop-at-home infomercial. The book’s tag-line of “If you will live like no one else, later you can live like no one else” didn’t really help in negating the infomercial feel too.

Still, some of the content in The Total Money Makeover aren’t total crap. Yeah, the extra product placement towards the end is a real turn-off. Sure, repackaging a previous written work as a new work is a bit shoddy, but within all the fluff and the “You can do it!” cheerleading, there are some meat to be found.

If you’ve already read his previous work, then The Total Money Makeover isn’t a necessary read. If you’re wallowing in debt and you haven’t read his work yet, The Total Money Makeover can be a helpful reference in adjusting to the right direction of debt mentality – but be careful to not rely on it (and its supplemental products) as a guide to building wealth.

Pros:

• Good at dispelling many debt and money myths
• Works well as a motivational tool in debt repayment
• A debt reduction method that looks to be solid
• Places emphasis on the importance of emergency funds

Cons:

• The anti-credit position is a bit overbearing
• Way too much stories making up the content
• Very similar to previous work
• Too many product placement & supplementing programs
• Careless mutual fund suggestions
• Depth-less wealth building content

Nothing beats starting an article with a rhetorical question:

Do you ever wonder what’s going on with your credit report and history? Ever wonder when your credit card provider will report the updated (higher) balance to the 3 credit reporting agencies? Ever wonder which of the 3 credit agency gets the updated balance first. Ever wonder what a credit report even looks like?

If you’re like me, you’ll be a bit curious too (or obsessed).

If you didn’t know, your credit history and your credit score changes frequently. This makes perfect sense, since our financial picture changes daily. One day we’ll have more money, the next day we’ll have less. The same applies to what goes on your credit reports. One week you may have lower balance thus higher scores, the next month you may have higher balance – thanks to your spouse giving little Jimmy that VISA he wasn’t ready for, thus reducing your score and getting a surprising slap in the face when you got rejected while trying to refinance your mortgage…

*ahem*

So who wants a slap in a face? I know I don’t.

Thus the best way to keep on top of what’s going on and avoid imaginary slapping of the face, is to utilize a daily credit report update service. You should note that these services are different in that they offer you daily updates of your credit report, instead of a single snapshot like other types of credit report. Since your report changes daily, having a service that can track daily changes will be especially useful for those in the process of credit improvement.

There are lots of daily credit report services out there, and one of the more popular services amongst the online credit forum users would be the services offered by Trilegiant.

Trilegiant is a big company that provides many different products and services, which ranges from shopping, health, entertainment, to consumer protection services. One of their forefront credits monitoring service would be PrivacyGuard.com

Here’s the Better Business Bureau’s Information Page on Trilegiant.

This review will cover services from each of the website below:

• Credit Keeper
• Privacy Guard
• Credit Alert
• Privacy Source for Bank of America

That’s quite a lot. But if you check these websites out, you’ll find that they’re pretty much all the same, Trilegiant basically just slapped together different color schemes. In fact, there’s quite a lot more of them out there. Check out the example below:

The main focus will be Credit Keeper and Privacy Guard, two services that I had subscribed to for a period of a little over a month. There has been lots of changes to Credit Keeper and Privacy Guard since my subscription, which was cancelled back in May of 2005. As mentioned, all of the websites above have the same color scheme; they also have the same features and services overall except for Bank of America’s Privacy Source which has a different contact number for customer services.

Each of the services have different pricing, which is a bit strange since they’re all from the same company (Privacy Source’s different pricing is understandable though).

Here are the current terms and pricing:

• Credit Keeper – 1 month free trial, afterwards a $9.95 monthly membership fee
• Privacy Guard – 2 months trial for $1, afterwards a $12.99 monthly membership fee
• Credit Alert – 2 months trial for $1, afterwards a $12.99 annual membership fee
• Privacy Source – 1 month trial for $1, afterwards a $129.99 annual fee

Each of the websites above also offers other different type of reports and scores. The main focus we’ll be going over here would be daily monitoring and daily credit report updates.

THE SIGN UP PROCESS

Is quick and painless. You provide your usual information and you’ll be good to go. They automatically generate a User ID for you, which contain parts of your last name and randomly generated numbers. You’ll also have an account number emailed to you, which you should keep for future reference (when you want to cancel the service).

NAVIGATING AROUND THE SITE

Could be a lot easier. Although the site presentation is fine, finding what you need is definitely a problem due to poor link placements. A lot of people (including me) seem to have problems finding out what to click to pull the daily credit report.

As you can see from the picture above, to request your credit report you’ll have to click on the “My Benefits” button and then click on the “Triple-Bureau Credit Report” link on the left. Afterwards you should click on “Request Report,” which will bring you to the report request screen.

If you check out the pictures, you can see why this may confuse people a bit, because the page looks like another sign up form. This page contain lines for you to input your credit card number to make payment (not shown in pictures), but you do not need to input them to request your report. Those that read more carefully will notice that the report is $0.00.

So to request your report, simply click on the check box shown (the service provides only one “What If” score, if you want more, you need to pay $6 for it). After you click on the box, fill in your social security number and click submit on the bottom. This will pull up your credit report for the current day. You should note that you can only request one report per day.

WHAT THE CREDIT REPORT LOOKS LIKE

To view a sample of the credit report provided, click HERE!

The first page you will see is the Credit Score tab. This shows your three score from the three credit report agency. You should note that this is a “FAKO” credit score, a score that’s computed by Trilegiant, but not by Fair Issac – which is the credit score company that most mortgage lenders rely on.

Although the scores are FAKO score (term use to indicate fake credit score) instead of FICO score (the real deal from Fair Issac), it does have some uses in the sense of giving you a feel of where you stand. FAKO scores are not computed using the same formula Fair Issac, thus they can be widely different from the real FICO score. You shouldn’t take FAKO score at face value and you shouldn’t rely on them to make major credit decisions. If you want a real credit score that most lenders use, check out www.myfico.com.

Now let’s take a look at the other tabs. Clicking on the Personal Profile Tab will show you the personal information that is contained in your credit report. You will see what each of the three credit agency has on their file. As you can see in the sample, there may be variance from one agency to another. This is perfectly normal.

Clicking on Credit Summary will provide you with a list of accounts from your credit report and the amounts owe on them. You can read the better description provided in the sample page. You will also see that the total amount dues and the account number listed may be different from one agency to another. Again, this is perfectly normal, and is one important reason why you should check your credit report.

Clicking on Public Records in the example will show the records for the unfortunate bankruptcy John Consumer had to file.

A very useful tab is the Credit Inquiries tab, which shows the hard inquiries that are shown on your credit report. Hard inquiries are those that can be seen on your report by everyone, while soft inquiries are those that can only be seen by you. One bad part about this credit report is that they do not show the list of soft inquiries.

Finally, we’re getting to the meat of the credit report. Clicking on Account History will give you a good glimpse into what accounts are shown on your credit report. You will see the current balance owe from each individual account shown in the report, and also your two year history of payment dates. On time payment are shown by the green OK circle, while late payments will be shown by a red circle.

The sample shown here does not provide enough information, but you can see that one of the accounts was reported by Equifax and Transunion, but not by Experian. Other differences you may encounter are the amount of balances, the payment history report, and the time when balances are updated. These discrepancies occur because certain creditors report to certain agencies. Some report to all, some don’t.

These differences are very important and they are one of the major reasons why a credit report pull is useful. Beyond getting your credit pull, consider getting your FICO score from Fair Issac by using this myFICO promotional code.

MY EXPERIENCES WITH THE SERVICE

All of the membership services I mentioned above offers daily credit monitoring from one single credit reporting agency, and daily credit report updates from all 3 credit agencies. Trilegiant has since then changed what’s available on PrivacyGuard, Credit Keeper due to abuse from members.

Because Trilegiant has been changing the services offered on each of their website so much, you should check each of the websites above to see what sort of services you’ll be receiving if you choose to subscribe to their service. The best bet is to call and ask for clarifications on the service you’re planning to get. Whether if reports are available daily, and if the reports are updated daily or not.

What happened was that some people wanted to see updates for their credit report so much that they resort to exploits to pull more than one report per day. It seemed daily credit report wasn’t enough, these people wanted hourly. I suppose if you’re doing some heavy duty credit improvement, you’ll need up-to-date information so you can make the best possible decisions. Still seemed pretty extreme to me though.

So during my subscription of Privacy Guard, they removed online credit report updates to stop the abuse (if you want a credit report, you’ll have to request it via snail mail). It’s pretty lame of them to punish everyone, seeing as how it was only a select few that abused the system. Although on the flip side, the people that exploited the system got their accounts cancelled. The rest of us just got our service changed.

Eventually I received a postcard from Privacy Guard, telling me that the information contained in my report will be updated monthly instead of daily. No more online daily credit report updates? No more Privacy Guard for me.

On the Credit Keeper side, all was well. I was able to continue to pull my credit report from all 3 agencies online daily.

The web server for the services were online and available the majority of the times, load time was fast and trouble free. There were rare down times, but usually if I come across a connection problem, it would be resolved within the hours.

Privacy Guard and Credit Keeper often tout the many “benefits” you’ll receive in subscribing to the service, some of which includes an interest calculator, which is fairly useful, but it’s a tool that can be found all across the web for free. Click on the picture below to see the calculator.

One notable benefit would be the free Drivers Record feature. Unfortunately for me, this was a useless feature, as you can see below:

Padded features aside, the features I’m paying for was working out well enough. (Before Privacy Guard changed the service anyway). Looking up daily updated credit report was very useful as I try to get a feel for how my credit issuers report to the credit reporting agencies. I found out that checking your credit report daily can get quite addictive – especially if you’re in the process of improving your credit. It’s nice to see the progress and results of hard work.

CANCELING THE SERVICE

Unless you’re rolling in money, you would probably want to cancel the service eventually. The canceling process is, unfortunately, not as easy as the sign-up process.

*looks of shock and surprise*

What? A company giving you a hard time when you want to cancel? Unreal.

When I received the postcard about the changes in Privacy Guard’s service, I immediately called to cancel, but it took long waits on the phone and many transfer to finally reach someone that can help me. Because I had two accounts with them, it complicated matters further.

As you can see in the pictures below, the charges made on my account was on 6/13/05, although I called days before to cancel, my refund was not processed till weeks later on 7/07/05.

On the flip side of things, the refund process with Credit Keeper went along without a hitch, which didn’t make much sense at all – since they’re both the same company, and customer service is handled by the same contact number.

As you can see above, the refund was processed within the same working week. Funky. Other than the semi-hassle experienced, there isn’t any major problem with canceling the service, as noted in the Better Business Bureau report.

THE CONCLUSION

Despite the many flunky incident involved with the Privacy Guard and Credit Keeper service, I would have to say that the overall experience was not that bad.

The information from the daily credit report updates are fairly valuable, and the layout of the credit report was well done. It was easy to read and easy to compare. Updates and changes to your report can be easily spotted from the Credit Summary page. This service is the perfect tool for those looking to fix their credit history, and people that are just generally curious

Although the cost of the service can eventually add up, the price of $9.95 per month, or $12.95 per month is actually pretty nice – especially for daily credit monitoring, and three credit report with daily updates.

The customer service was obviously lacking, but I didn’t expect much in the first place. Customer service for Privacy Source (for Bank of America) was reportedly better, as Bank of America has a different contact number (and possibly different service rep) for their service subscribers.

Canceling the service was quite a hassle, for I had to listen to the usual scripted speech of why I should keep the service, and the “benefits” I’ll loose if I cancel the service. The refund process was also inconsistent, but I eventually received my money back.

At the end I believe that the real benefit from the service outweighs some of the quirk. That’s the case for me anyway. If you’re in a situation where you require daily credit monitoring, and daily credit reports update – you should definitely check out Credit Keeper or Privacy Guard. (I’ll go with Credit Keeper since it’s cheaper per month, if you decide to keep using it).

Besides, you’ve got nothing to loose during the trial period: one measly dollar, some of your valuable time, and a little bit of your sanity as you try to call and cancel.

PROS:

• Daily credit monitoring
• Daily updates for 3 credit reports
• Well layout for credit reports with fairly detailed information
• Price for service is fair

CONS:

• Services provided seemed inconsistent
• Other benefits are fairly useless
• Hassle in canceling service
• Questionable sell tactics via BBB’s report

Dave Barry’s Money Secrets:
Like: Why Is There a Giant Eyeball on the Dollar

Author: Dave Barry (really!?)

Publisher: Crown Publishers, Random House

ISBN: 1400047587

URL: www.davebarry.com

Milk came out of my nose.

While reading Dave Barry’s Money Secrets, I was having some cookies and milk – it was a horribly bad idea.

Luckily for me, I didn’t stain the library book.

I’m not too familiar with Dave Barry or his work, but after reading the introduction to Money Secrets, the genius in me has concluded that Dave Barry is quite a funny fellow. Anyway, Money Secret is a parody on money books, it is 240 pages long and uh, its shipping weight is 12.6 ounces.

Money Secrets contains 22 chapters dedicating to specific, important financial topics that are similar to the ones you’ll find in money books. It also has many pictures of Suze Orman, and a few pictures of Donald Trump. Why? Steal your own copy and find out.

Here are some of the chapters found in the book:

• How the U.S. Economy Works – Adam Sandler is involved
• Providing for Medical Care – You’ll need some leeches
• Teaching Your Children About Money – Let the little bastards starve
• Planning For Your Retirement – The financial advantages of early death

Personally I would love to list all of the chapters, as they all have hilarious captions attached to them, but that’ll just spoil the book for you. If you think finance is a boring subject, think again. From how to read an annual report to how to negotiate deals (Dave suggest carrying a machete with you), Money Secrets made me laugh so much that I almost choked on my cookies.

Other wacky stuff from Money Secret included suggestions on filing your taxes. Dave’s tip? Write your name on the tax form, followed by the word: DECEASED.

Har har!

Wasn’t that hilarious? I’d love to list more examples but I have a feeling I’ll just ruin more jokes.

Money Secrets also contained lots of nifty graphs and charts, a plus for literary challenged people like me. Here’s one where Dave shows why cigarettes are so expensive:

I can list even more graphs and charts, but at the risk of being sue and ruining more jokes, I think I’ll stop here.

So yeah, where was I?

Right right, funny book, funny man. I read it, I spit milk, and I laughed out loud. Good times.

The book can get a bit silly though. In some instances, I felt like I was listening to a joke told to me by my 10 year old cousin. But the silliness is kept to a minimum, so it’s not really a big problem. Another small problem is the price tag, the book’s MSRP is $24.95, a little bit on the steep side. ‘Course, no one pays retail anymore these days… and there’s always the library or the five finger discount (I suggest library).

To conclude this depth-less review, Money Secrets is a laugh out loud riot that’s appropriate for all some ages. If you’ve been stressing out about financial matters, you might want to consider picking up this book. It’ll help you laugh a little, or cry a little – especially when you realized that the examples in the book matches your financial situation.

That’s what I did. Tears are yummy along with cookies.

Pros:

• Freaking funny
• Freaking hilarious
• Freaking frequent mentions of toilets

Cons:

• Gets a bit silly sometimes
• Not enough mentions of toilets

The Five Lessons a Millionaire Taught Me About Life and Wealth

Author: Richard Paul Evans

Publisher: Fireside, Simon & Schuster

ISBN: 0743287005

URL: www.thefivelessons.com

I received a copy of the book via the publisher’s marketing department, whom I must commend for sending the book at such lighting fast speed. Thanks again for the book.

Before “The Five Lessons,” the only work I’ve read by Richard Paul Evans was his first book, “The Christmas Box” – a pretty good book and like many people I enjoyed it. As Richard Paul is a writer of inspirational and moral stories (mostly Christian themed), it was a bit interesting to see him write a book on the subject of money.

“The Five Lessons” is pretty short, at about 133 pages (24 of those forms), it’s a pretty quick read. The actual length of the book is at about 100 pages, with about 10 pages of resources & tips. I enjoy a long, entertaining novel as much as the next guy, but if someone is going to drill some important points to me, they better do it fast, sweet, and to the point. “The Five Lessons” did a pretty good job at that.

I’m not sure if these qualifies as spoilers, but here are the Five Lessons:

1. Decide to Be Wealth
2. Take Responsibility for Your Money
3. Keep a Portion of Everything You Earn
4. Win in the Margins
5. Give Back

The author divides each of the lessons as chapters, and smoothly lays out the topic to the reader. Each lesson is accompanied by decent stories to entertain, and mostly good examples to support and help explain lessons further.

“The Five Lessons” certainly doesn’t present anything new in the categories of money book (nor does it claim to), but if it was the first “money book” you’ve ever read, it’ll be a good choice – especially for those new to the genre. It covers many of the basic concepts in achieving financial independence: mentality of choices, control of cash flow, saving and investing, and wise purchasing decisions. All in a small 133 pages package. Not too shabby.

For those of us that have read many money books, it would be a good reminder. Many parts of the book reads like “The Millionaire Next Door,” emphasizing the fact that average people with average income can become millionaires with careful spending, saving, and investing methods.

Some of the examples given in the book made me raise my eyebrows though. His example on Xango Juice, a multilevel marketing company made me flinch a bit, as did his story on hypnosis; where he relates hypnotizing his friend to the bombardment of advertisement we receive.

Complaints aside, the book was right on target with its principals. You may see them under different name and phrases, but they are still the same concepts that you’ll need to take control of your financial life.

What I especially like was that throughout the book, the moral aspect of money, and its ability to influence both positively and negatively was discussed at length (for a 133 pg book).

At the end, “The Five Lessons A Millionaire Taught Me About Wealth and Life” is a pretty good book. It’s certainly not the greatest in the genre, but it’s definitely not the worse. There are plenty money books out there that takes 5 times as long to convey the concepts to its reader – and to the reader’s woe, at a much less entertaining pace.

Pros:

• Short & Basic
• Moral Values
• Not Boring

Cons:

• Short & Basic
• Some Questionable Examples