Rising Mortgage Rates: The Silver Lining

6869769579_be67cbcda2Rates for 30-year fixed mortgages rose again this week. Current rates have reached 4.41%, according to the Zillow Mortgage Marketplace, up from 4.28% last week.

“Rates remained steady for the second week in a row, alleviating some concerns that they would continue the upward surge that began early this summer,” said Erin Lantz, director of Zillow Mortgage Marketplace. “This week, although we expect continued volatility, we expect rates will remain fairly steady until a clearer picture emerges about the strength of the U.S. economic recovery.”

Many experts agree, however, that rates are likely to continue to climb. This has left potential buyers with some anxiety about their prospects of getting a good deal on a mortgage. Rising rates aren’t all bad news, however. Here’s the silver lining.

Today’s Rates Are Still Pretty Low

With so much excitement around activity in the market, it’s easy to lose sight of the context. Current mortgage rates, though higher than they were months ago, are still historically low. If you want to buy a home, an interest rate below 5% shouldn’t be much of a hinderance. Experts have also said that the rising rates shouldn’t stall the recovery of the housing market with so much demand still present.

The Economy is Improving

“Higher rates mean the economy is doing better, which is good for housing prices,” says John Walsh, president and founder of Total Mortgage in Milford, Conn. Interest rates are to our national economy. They were driven down in an effort to jumpstart our economy and it seems as though it’s working, at least in the housing market. Overall, an increase in interest rates signifies some optimism that consumers can afford them.

More Home Sales

Finally, one theory around rising rates is that it energizes potential buyers to make a decision. Everyone want to get the best possible deal on their mortgage and the possibility of higher rates will draw out serious buyers, pulling them “off the fence,” which should result in increased sales. For homeowners looking to sell, that’s great news. And currently, not only are home sales on the rise but also home sale prices.

Photo Courtesy, 401(K) 2012.

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Study: Most Men Want to Go Dutch

If chivalry means footing the bill, a new study suggests it just may be dead.

A team of researchers set out recently to investigate gender norms and how they’ve changed over the years, specifically when it comes to the question of who pays for dates. California State University’s Janet Lever and colleagues from Wellesley College and Chapman University surveyed more than 17,000 participants and found that two thirds men (64%) said they’d like to share dating expenses, or go dutch.

Other important findings of the study: 44% of men said they would stop dating a woman who never pays for dates, but 76% reported feeling guilty accepting a woman’s money. Women aren’t any less conflicted. More than half (57%) reported offering to help pay for dates but 39% confessed to secretly hoping their date would reject the offer. Forty-four percent of women were bothered when men expected them to help pay. Coincidentally, that’s the same share of men that would stop dating a woman who never paid.

In all, researchers found that men still pay for most expenses on the date. That’s according to most men (84%) and most women (58%.)

“Our data suggest there has been significant movement away from a monolithic cultural norm for dating and towards a more variable set of strategies and interactions,” the report reads. “The data presented here support the notion that many people‘s behaviors – across age, income, and educational variations – are disrupting old gendered assumptions about “who pays” and in that respect those people seem to be attempting to undo gender.”

And, ultimately, it seems as though couples may move more toward sharing expenses as time goes on. Nearly 40 of all participants agreed that dating expenses were shared in the first month of dating, even if men are payed a larger portion. By the six-month mark, 74% of men and 83%of women reported sharing expenses.

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Best Way to Save on Eyeglasses

New eyewear, updating your old frames or replacing broken ones can come at a hefty price. And if you’re among the two-thirds of adults who need glasses or contact lenses, that cost is almost unavoidable.

Ever wonder why they’re so expensive? Last month, a team at “60 Minutes” looked into it. They found that one Italian company, Luxottica, controls the lion’s share of the market. They manufacture most of the designer brands: Gucci, Prada, Ray Ban, Oakley, Polo, Ralph Lauren, Versace, Chanel, Chaps, Paul Smith. If that’s not enough, Luxottica also owns and/or runs retail channels like Lenscrafters, Pearle Vision, Sears Optical, Target Optical, Sunglass Hut, and Oliver Peoples. Luxottica is the largest eyewear company on the planet and its CEO estimates that half a billion people are wearing one of their products.

They set the price and we pony up an average $200 per new pair.

Here are 3 ways to save:

Check Your Coverage

Before you pay for anything out of pocket, check your health insurance too see what’s covered. Many plans allow for some of the cost of vision expenses, like one annual eye exam and a part of the cost of new glasses. Also, if your employer offers a flexible spending account, eyeglasses are just the kind of expense you should use it on. With an FSA, you can use pre-tax funds to make the purchase, saving you overall. Most FSAs cover eye exams, prescription glasses and sunglasses, reading glasses, contact lenses and solution.

Take Advantage of Promotions

Another way to save on eyeglasses is to take advantage of deals offered by retailers. For example, right now at Pearle Vision, you can get 50% off of eyeglasses when you buy contacts. They have a separate buy-one-get-one-free deal – perfect for the accident-prone. Getting your extra pair free will save you in the long run in case your regulars are lost or broken.

Shop Online

Finally, online eyewear retailers are sweeping the market. Sites like Zenni Optical, Warby Parker and Classic Specs have quickly swept in to become a low-cost alternative to traditional retailers. Online, you can get a complete pair of single-vision glasses from $50 to $100. To make sure you get the pair you want, Warby Parker will even send you five pairs to try on at no cost before making your pick.

Photo Courtesy, William Wu.

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Save on College Textbooks

The first day of school is rapidly approaching. For college students that means one really big, immediate expense: textbooks.

Every fall students dole out hundreds of dollars on textbooks. When I was in school, to be honest, it just felt like a huge ripoff. You buy a really expensive book you’ll barely read throughout the semester and when all is said and done, you’re stuck with it. There has to be a better way, right? Well, actually there is.

Check out these 6 ways to save.

Compare Prices Online

Direct Textbook is the leading site for price comparisons on college textbook. Research from the company finds that most students overpay an average of 45% for books, primarily because they don’t shop around for the lowest price. With the average student at a four-year college expected to pay nearly $5,000 as they matriculate, savings of 45% could mean $2,250 in the bank. Use Direct Textbook, or a similar site, to find the best price for the books you need. Odds are, finding it online will beat the price at your campus bookstore.

Know the Right Time to Buy

As with most things, there’s a best time to save on textbooks and that time is fast approaching. When shopping online for new or used books, the lowest priced ones will sell out quickly. An analysis by Extrabux.com found that the weeks of Aug 20-26th and Jan 7-13th are when prices are best. Why? It all has to do with supply and demand. During those weeks before and after school, the market is flooded with books and prices tend to come down.

Opt For Used Books

A great way to save is to buy used textbooks, especially books that you don’t plan on keeping. For elective classes outside my major, I almost always bought used. Used books come at a significant discount in campus bookstores and online. Amazon.com, BigWords.com and Ebay’s Half.com are all great sources for used books. One tip for buying used books: Check with your professor to find if older editions of the book will suffice. They’re usually available at lower prices, include only minor differences from the newest editions and are abundant online.

Rent Your Book

Textbook rental sites like CheggBookRenter, and Barnes & Noble can help save pretty hefty amounts. For example, right now on Chegg, you can rent “Essentials of Business Communication, the 9th edition” for just $45. The price to buy: a whopping $124.

Go Paperless

Yet another way to save on textbooks is by downloading them. On average, you’ll save about half with retailers like Amazon and Barnes and Noble. Ebooks of course can be very handy and will lighten the load in your backpack. The downside, however, is that when you’re done with the book, there’s no option to resell it so a download is only advisable if it’s a text you really want to keep.

Recoup by Reselling

Need book money for next semester? Resell your used textbook. Again, marketplaces including Amazon.comBigWords.com and  Half.com are perfect destinations and you’ll want to zero in on Aug 20-26th and Jan 7-13th as key dates to sell your books because demand will be at its highest. According to Extrabux.com, students can sell their textbooks for as much as 20% more by selling during the right months. All you have to do is keep them in great condition.

Photo Courtesy, John Liu.

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Would You Cancel Cable?

With cable companies battling it out with major networks, and prices rising all the while, customers are considering forgoing cable TV altogether.

According to a recent report from Macquarie Capital, the price for popular packages from cable companies just keeps going up. “Triple-play” service – cable, phone and internet – has jumped in price about 6.3% every year for the past three years. To put it in terms you can feel, the average bill for the three services has increased by nearly $50 since 2010, coming to an average total of nearly $270 per month.

A big reason for the rising cost of cable is the business behind it. Most recently, that business has been illustrated in a the battle between CBS and cable giant Time Warner. Some may not know, but cable companies pay to carry a network and its programs. That cost and its rise is passed on to cable customers. Recently, when CBS attempted to raise it’s cost in negotiations with Time Warner, the cable company refused – leading to the current blackout of CBS through Time Warner systems with no end in sight.

Macquarie asked consumers which service – cable, internet or phone –  would they cut first to save money. More than three-fourths said their cable TV service – and understandably so. It’s the service that varies most in price and there are so many other options.

Shop Around for Cable Providers

One obvious way to save on your cable bill is to make sure you’re getting the best deal. Prices vary widely by providers and based in services. Comparing cost can be a lot of work. To help, WhiteFence.com searches your address to find all of the providers in your area and offers side-by-side comparisons for their deals – along with information about current promotions.

Negotiate With Your Cable Company

If you can’t see your life without TV, it’s effective to negotiate with your cable company. Armed with information on what’s available in the market, give your provider a call. Ask about promotions and other ways to save. It even works to threaten to cancel your service or some features if your bill isn’t reduced. You could bring your bill down by about $10 to $20 or talk yourself into some free channels.

Cut the Cord 

It’s been shown that the number of pay-TV subscribers is declining. If, like me, you watch most of your programming from your computer, it might be smart to cancel your cable subscription. Instead consider an Apple TV unit. The device costs $99 and uses wi-fi to turn your TV into a media player. Apple TV works with Youtube, Hulu, Netflix and other subscription services to play all the media you need right on your TV.

Photo Courtesy, Alyssa & Colin.

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Federal Student Loan Changes

The fate of interest rates for federal student loans has been in limbo for nearly a month. Finally, Congress has come up with a fix that will save students money in the short term but could end up costing them more in the future.

For months now, we were worried that interest rates on federal student loans would double -reaching 6.8% – if Congress couldn’t reach a compromise before their July 1 deadline. The date came and that’s exactly what happened. But, just in time for the fall school year, our legislative leaders seem to have reached an agreement.

Under a plan passed Wednesday by the Senate, interest rates will no longer be voted on and reauthorized periodically by Congress but set  to a 10-year Treasury auction rate. This way of setting the rate treats students like other borrowers, making them subject to market rates at the time they borrow. Again, the changes have been approved by the Senate but are pending approval by the House, which experts say is likely.

“Unfortunately, the solution is worse than the problem,” says student loan expert Heather Jarvis. “It’s a double-edged sword. During times when the market is weak, students will win. But pretty much everyone agrees that rates are subject to rise.”

Today’s Treasury rates are unusually low, so the rate is proposed to be set in the fall at 3.86% for undergrads, 5.41% for graduate students and 6.41% for parents. That’s significantly better than where they were before Congress acted but, as the economy gets better, the cost of financing an education will rise. The Senate plan, however, does place a cap of 8.25% on interest rates for undergraduate loans, 9.5% on graduate loans and 10.5% for parent Plus loans— higher than what students and parents have payed in the past.

It’s important to note that any existing loans with the federal government wont’ be effected by these changes. For all future loans, the plan will be  retroactive to July 1, 2013. That means, in large part, students entering school and borrowing in the fall will be get their loans at the new rate. Jarvis explains that once the loan is issued, it will be fixed and won’t change over time. But every year, new loans will be issued and their interest rates will be evaluated and set, according to market conditions, every June 1st.

“People entering now are borrowing at the right time. Rates are low,” Jarvis says. “But someone starting high school is likely to borrow at significantly higher price. An increased rate could mean a difference of a few different thousand dollars more. That’s real money people could use.”

Photo Courtesy, 401(K) 2012.

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Saving Secrets: School Supplies

With less than a month out from the start of the school year, parents across the country are probably already receiving the all-important lists for supplies their kids will need come fall. And if you’ve been shopping lately, you’ve probably noticed that back-to-school sales are already in full swing.

The upcoming September issue of ShopSmart magazine, from Consumer Reports, details how to get the best deals on everything your kid will need. Here are the retailers with the best bargains and a few tips to save this year.

Start in Early August

The best time to shop? The magazine says shoppers should start grabbing items and checking them off their lists beginning in early August when deal are and stock are plentiful. And unlike other sales, where prices continue to drop, an analysis of 500 back-to-school deals by consumer site NerdWallet.com found that 78% of the back to school items selling in July sold at the exact same price in August.

Now, don’t just run into your local office-supply store to buy it all, says Lisa Lee Freeman, editor-in-chief of ShopSmart. “If you find yourself beyond the sale bins, you could wind up paying more than twice as much as at a discount store,” she says.

Avoid Office Supply Stores

The team at ShopSmart did a price comparison on common back-to-school items, at some popular retailers, so you don’t have to. With a list that included items like glue sticks, notebooks, printer paper, sharpies, pens and pencils, they found that – overall – Walmart had the best deals on most of the supplies, followed  by Target (with just a few cents difference.) For example, the magazine found that Walmart had the lowest price on Elmer’s Washable Glue Sticks, a (3-pack) for $2.94. At Staples, the same product cost nearly double.

More Ways to Save

Finally, to help you navigate the stores and save a few bucks, here are ShopSmart’s “Five Easy Ways to Save on School & Office Supplies.”

1.     Seek store-brand supplies. They’re not easy to find (Walmart had almost none), but shoppers who do can save as much as 74% compared to name-brand supplies.

2.    Check out weekly sales circulars the first of the month for the best deals. Sites such as Spoofee.com and SundaySaver.com link shoppers to local ads for dozens of stores.

3.    Download the Weekly Ads & Sales app. This mobile tool, free for Apple, allows users to view the latest ad pages while on the go without dealing with paper clutter.

4.    Search online for deals. ShopSmart found online prices for OfficeDepot, Staples, Target and Walmart closely matched those in stores, but shoppers may have to shell out for shipping.

5.    Ask for a price match. Shoppers who find a better deal somewhere else can show their phone or a paper ad at checkout at stores with price-matching policies to earn a match or discount.

Photo Courtesy, woodleywonderworks.

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