Average account balances in 401(k) plans soared to touch a new high in 10 years at the end of 2010, showing that more Americans are now saving for their golden years than ever before. A report recently released by Fidelity Investments, the largest 401(k) plan provider, showed this trend. Almost 11 million participants hold these retirement planning accounts with Fidelity.
According to the report, average account balances rose by more than 10% when compared with 2009 end figures. In dollar terms, the account balance averaged at $71,500 at the end of the last year. Calling this a ‘positive finding’, Beth McHugh, marketing insights vice president at Fidelity, said that this trend shows that more people are saving now.
One important point to note about the increase in account balances is that not all of it is directly attributable to increased savings by the account holders. About two thirds of the increases came from better market performance while only the remaining one third arises from participant contributions.
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Loan Alternatives for People with Bad Credit
Getting a secured loan from a bank can be difficult when you have a bad credit score. Although bad credit is a major reason for rejection of a bank loan, there are several other reasons that also hinder the loan approval.
Whatever be the reason, you can always fall back on unsecured personal loans for people with bad credit, to meet your financial requirements. These loans are a convenient alternative to the bank loans and are very handy, especially in case of emergencies. Here are some of the options you can choose from, in case you have a bad credit rating.
Loans from Family Members
Loans from a family member or a friend can be extremely convenient, provided your friend or family member can afford and is willing to lend you the money. The plus point of this loan is low or zero rate of interest and long repayment tenures. However, it is not a guaranteed option, as your chance of borrowing depends on the availability of funds and your relationship with the person.
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Tips to Find the Best Unsecured Personal Loan
Getting a loan when you have bad credit can be challenging. With a number of traditional lenders and online lending companies offering personal loans for people with bad credit, finding that reliable lender who can offer you a good deal is even more difficult.
While one reason for this is increased competition among the lenders, another is the borrower’s ignorance about these loans. So, here are a few tips you can use to choose the best unsecured personal for your needs.
Re-evaluate your credit score
While the credit score awarded to you by the bureau may be poor, it may not always be as bad as projected. Credit ratings are highly vulnerable even to the slightest remarks and late payments in your past, which makes it important for you to check them yourself and evaluate your current financial situation. If possible, you can even attempt to fix your credit score and improve your chances of getting the personal loan.
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Home Loan Options for Bad Credit Borrowers
Buying a home can be a dream come true for many. But to turn this dream into reality, you should either have a lot of money or be eligible for a home loan. While home loans are easily available to people with good credit scores, not many banks offer home loans for people with bad credit.
Although a good credit score is a prerequisite to reduce the risk of lending huge amounts, you can also get a home loan despite your bad credit score. Here are some home loan options you can consider.
One of the more traditional options, land contracts allows you to buy the house by taking a loan from the property owner. The land contract loans are ideal for people with bad credit as they don’t require a credit score check, as in a mortgage loan from a bank.
Although such an option requires the borrower to make a considerable amount of down payment, the amount may differ from lender to lender. The rate of interest for such loans can be competitive, but in comparison to the other home loans, it can be high.
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A Guide to Bad Credit Student Loans
A bad credit score often ruins your future plans of buying a home, car, or going on a vacation. Sometimes, it may also affect your chances of acquiring a student loan, preventing you from studying further. But the good news is that you can get a student loan and complete your higher education, even if you have a bad credit score. Here are a few tips you should keep in mind to obtain student loans for people with bad credit.
Finding the Right Lender
There are many lenders like banks, private moneylenders, government institutions and credit unions who offer student loans these days. From some of the major banks to online lending institutions, a number of people are also willing to offer student loans for people with bad credit.
As unsecured student loans may have slightly high rates of interest, you can look for secured student loans for bad credit, if you have anything valuable to offer as collateral. This reduces the lender’s risk of losing money and increases your chances of getting a loan.
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Understanding Bad Credit Auto Loans
Are your plans of buying a new car at risk because of your bad credit? Don’t worry. These days, there are many lenders who are willing to offer car loans for people with bad credit at reasonable rates. Here are a few tips and methods on how you can get bad credit auto loans.
Increase down payment
Getting an auto loan is difficult when you have a bad credit score. But your chances of getting a loan approved improve when you increase your down payment amount. By increasing your deposit on the vehicle, you are reducing the loan amount and also the risk to the lender. This can be beneficial to you too, as your rate of interest also reduces, bringing down your monthly repayment amount.
Pre-approved loan options
Another way to obtain a bad credit loan for your car is to go for the pre-approved auto loan option. Pre-approved car loans for bad credit allow you to have an idea about the loan amount you can get and plan your budget accordingly. With these loans, you can focus on buying the best possible car within your budget, rather than worrying about whether or not you will get a loan.
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How to Get a Mortgage Loan with Bad Credit
Getting a mortgage to buy a home can be possible even when you have bad credit. Unlike the unsecured loans that are difficult to obtain, mortgage loans are secured home loans, where your house is put up as collateral. These loans are offered by a number of banks and financial institutions, even for bad credit borrowers, mainly because of the reduced risk of non-payment. If you are looking for mortgage loans for people with bad credit, you will find a number of options at your disposal.
Seller carry back mortgage
This is one of the best options in mortgage loans for people with bad credit. The seller carry back mortgage is a home loan that real estate owners offer to their buyers. The advantage of this loan is that they provide up to 100% financing if necessary and the interest rates and terms of the agreement are decided by the seller and the buyer as per the usury laws of the state.
Option of a federal loan
People with bad credit can consider the option of federal government loans, which have lower rates of interest and lenient credit rating requirements. You can apply for a bad credit mortgage with the Federal Housing Administration or other government agencies like the Department of Veteran Affairs, if you are a military veteran.
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