When buying a car, is trade in or down payment better?

June 30, 2024 No Comments

A: When buying a car, it may be better to have a down payment rather than a trade-in. A trade-in offers convenience to the car buyer, since one can walk into a dealership with a used vehicle and walk out – or rather, drive out

Where Do Companies Keep Their Cash?

June 30, 2024 No Comments

A: If you have ever looked over a company’s balance sheet, you have no doubt noticed the first account under the current asset section is cash and cash equivalents. The cash account contains, as the name suggests, all of the company’s cash, while the cash

Who sets interest rates for federal student loans?

June 30, 2024 No Comments

A: The interest rates for federal student loans from the U.S. Department of Education are set by Congress through legislation. The interest rates are closely tied to the financial markets, and are usually similar to the rate of the 10-year Treasury note plus an additional

Why are credit cards able to charge such high interest rates compared to other lenders?

June 30, 2024 No Comments

A: A true financial horror story began on Halloween in 1978. On that date, the Supreme Court began hearing Marquette National Bank vs. First of Omaha Corp. The case appeared to be a simple conflict over which state laws govern the relationship between debtor or

Why are most airplane tickets nonrefundable?

June 30, 2024 No Comments

A: Airplane tickets are generally nonrefundable, because the majority of tickets sold are discount tickets. In exchange for discounts of 60 to 80% off the cost of a full-fare ticket, airlines make tickets nonrefundable and nontransferable. They do this to have greater predictability of customer

Why are most brokerage firms owned by banks?

June 30, 2024 No Comments

A: Most brokerage firms are owned by banks because this allows the banks to act as both brokers and dealers, and they have more resources at their disposal to weather market fluctuations. When banks execute transactions for an individual client, they are considered brokers. However,

Why do you need an emergency fund?

June 30, 2024 No Comments

An emergency fund is very handy when unplanned and unexpected expenses arise. It is always advisable to have some money tucked away for a rainy day, as an emergency fund can supplement any temporarily foregone income or can be used for an infrequent/unexpected purchase. Usually,

When is mortgage insurance tax deductible on rental property?

June 30, 2024 No Comments

A: Mortgage insurance premiums on a rental property are tax deductible in the year that they were paid. However, if multiple years of premiums are prepaid all at once, the only portion that can be deducted is the premium payment that applies to the given

What net interest margin is typical for a bank?

June 30, 2024 No Comments

A: In the United States, the average net interest margin (NIM) for banks was 3.10% in the first quarter of 2017. Though a rebound from the 30-year low of 2.95 in the first quarter of 2015, it’s lower than a decade ago: The net interest

What to bring to a bank to open a checking account

June 30, 2024 No Comments

A: Opening a checking account is a fairly simple process. You choose a bank, show up, fill out some paperwork, provide some documentation and leave with a functioning account – most of the time. Eligibility requirements for checking accounts are few. All banks require you

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