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persfin-digest        Monday, October 12 1998        Volume 05 : Number 056



In this issue of the Personal Finance Digest:

       Re: Credit card rebates
       Re: APRs on Credit Cards and Auto Loans
       Credit card rebates
       Frequent Flier Credit Cards
       Re: persfin-digest V5 #55
       Re: Asset Allocation
       Re: Refinancing
       RE: balance transfer
       Vote your conscience...

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----------------------------------------------------------------------

Date: Thu, 8 Oct 1998 13:50:15 -0400
From: "Porter, Jim R" <[e-mail]>
Subject: Re: Credit card rebates

Steve Foulks <[e-mail]> wrote:
>A friend of mine was asking about credit card rebates.  We both have GM
and
>Ford cards that we max each year.  We were thinking that credit cards
with
>frequent flyer miles would be our next best choice.  Does anyone out
there
>have any thought on good frequent flyer mile credit card programs?

While I believe that cash rebates are superior to other forms, if you
are
determined to look at frequent flyer options, a great site to check (for
credit card rebates of all kinds, including frequent flyer programs) is
http://flur.com/cards/ . When looking at your options, keep in
mind that a frequent flyer mile is considered to be worth about 2 cents.
Compare that to cash rebates available on some cards, while factoring
in the (almost certain) annual fee, and the fact that airlines are
flying
so full these days that being able to actually USE your FF miles is
getting difficult (reserve months in advance for popular destinations,
blackout periods where you can't use them at all, etc.). Certainly
some frequent flyer rebate cards are better than others, but if you
take a cash rebate card, you have all the flexibility of where you
spend the money.

Jim Porter
[e-mail]

- -

------------------------------

Date: Thu, 08 Oct 1998 13:56:22 -0400
From: "R. Forgue" <[e-mail]>
Subject: Re: APRs on Credit Cards and Auto Loans

The beauty of APRs is that they provide a point of comparison for various
loans.  Thus, the loan with the lowest APR is the generally the best deal
regardless of amount borrowed, time period, etc.  Nonetheless, the 3.9 or
4.9 percent credit card rates are invariably teaser rates that will revert
to a much higher rate after 6 months or so.  An auto loan at 7.75 percent
beats virtually any credit card.

Dr. Ray Forgue, Director of Graduate Studies
Family Studies Dept., University of Kentucky
315 Funkhouser Building,  606-257-7756, 606-257-3212(fax)
[e-mail]

- -

------------------------------

Date: Thu, 8 Oct 1998 15:29:47 -0400
From: "Jack R. Stokvis" <[e-mail]>
Subject: Credit card rebates

On 10/8/98 [e-mail] said:

>A friend of mine was asking about credit card rebates.  We both have GM and
>Ford cards that we max each year.  We were thinking that credit cards with
>frequent flyer miles would be our next best choice.  Does anyone out there
>have any thought on good frequent flyer mile credit card programs?

Simple solution: get another GM/Ford Credit card in another name (ie a
spouse as primary holder). Those two are the only CCs left which give 5%
rebate. All the airline FF cards are 1-2% and have many strings. I
consider the Quicken or Smith Barney CC much better. With them (both
handled by Travelers Group) you pay $25-50 for a Airline membership miles
program which gives you the following:
for every $6000 spent, $100 certificate good for any airline ticket
for four such certificates, a free airline tix
and the best part, you can get FF miles on those tickets!

Jack Stokvis

- -

------------------------------

Date: Thu, 8 Oct 1998 20:55:47 EDT
From: [e-mail]
Subject: Frequent Flier Credit Cards

Steve Foulks recently posted the following:

>A friend of mine was asking about credit card rebates.  We both have GM and
Ford cards that we max each year.  We were thinking that credit cards with
frequent flyer miles would be our next best choice.  Does anyone out there
have any thought on good frequent flyer mile credit card programs?<

In the past four years we have used three free mileage credit card programs.
We like the programs and get about 1 free flight a year. We figure the free
mileage credit cards offer 1 1/2 - 2% rebate a year.  All the free mileage
credit card programs have an annual fee, but some waive the fee the first
year. All credit 1 mile for every $1.00 charged.  Of course they have
different frequent flier mileage requirements.

We have found the credit cards sponsored by a specific airline better than the
cards that allow you to fly on any airline, but insist that you book through a
specific travel agent.  We had a card like this and had trouble getting the
flight we wanted even though the program advertised any flight any time.

We used and liked like United's credit card and frequent flier program.  Just
completed a free credit card flight from San Francisco to Montreal.   Our
current credit card is with Fist USA Bank for Brittish Air.


- -

------------------------------

Date: Thu, 08 Oct 1998 13:23:39 -0500 (EST)
From: "Gary M. Oppenheimer" <GOPPENHEIMER/[e-mail]>
Subject: Re: persfin-digest V5 #55

I believe you'll find that those rates are for credit card charges, not for cash
advances (which you'd need to pay off the car loan).  Your only way around this
is to buy something with the credit card, and sell it immediately for its cash
value to someone else.  Use the cash to pay off the car loan, and then pay down
the "loan" with the credit card debt.

- -------------------------------------------------
Date: Wed, 7 Oct 1998 16:26:31 -0700
From: "sreeni tellakula" <[e-mail]>
Subject: balance transfer

Hi

I keep getting offers from credit cards at 3.9%
to 4.9%APR.

I have an auto loan at 7.75%.

If I transfter this loan to the credit card, will I save?
Can some one tell me how credit cards compute interest?

For ex: the auto loan - the interest is calculated as follows:

balance: 10000, 1 month time, APR 7.75%

Interest at end of month  10000 X 7.75 / (100 X 12)
$64.58.


Thank You
- - ---
Sreeni Tellakula
[e-mail]





- -

------------------------------

Date: Thu, 08 Oct 1998 19:01:39 -0400
From: Stephen Brodeur <[e-mail]>
Subject: Re: Asset Allocation

I understand that asset allocation techniques can dampen the swings
in portfilio values, much like diversification in general can reduce wild
swings
vs. concentrated holdings.

But I also believe that I heard that asset allocation can actually *beat*
the performance
of the best asset class over the long run. I wish I could remember where I
(think I) heard
this claim. The rationale for such a claim is something like this:

You pick an allocation scheme that you want to follow for some long period,
based on
risk tolerance and time frame and all that stuff. You stick with that
allocation mix, and
"regularly" (yearly?) adjust your holdings to keep in line with the mix.
This has the effect
of capturing gains in strong segments and putting them into weak
(underperforming, and
possibly undervalued?) segments. Superficially, this sounds like you are
selling your winners
to buy losers (very unappealing). But it also sounds like selling high and
buying low (brilliant).

I think the result is supposed to be that the overall effect of capturing
some of your high
performance gains and buying low into out-of-favor asset classes will give
you a higher net
result than taking the "highest performing class" and just riding the
storm. In order for this to
work, the gains that you miss by holding the sub-par performers during the
boom times must
be more than offset by the loss you would suffer when the high flyers crash.

So, my question is, does asset allocation actually outperform individual
asset classes performance
over the long run, or does it just impact the risk and the fluctuations? Is
it a performance vs.
risk/comfort issue, or is it a performance enhancing technique?

- -Steve Brodeur x222




- -

------------------------------

Date: Thu, 08 Oct 1998 15:22:23 -0400
From: Scott Barnett <[e-mail]>
Subject: Re: Refinancing

>I play the 'no points no closing' (NPNC) game. What this does for me is to
>let me jump with no historic committment to an earlier mortgage schedule on
>which I had to lay out money. I estimate that I pay about 1/4 to 1/2 of a
>point more for that type of deal. But look at my history. I am now
>processing the application for my 6th, yes 6th, NPNC. All 30 fixed.  In the
>last three years I've gradually moved my interest costs from over 9.0% (on
>an ARM that was going up and up) to 6.75%. And the beautiful thing is that
>it costs me nothing. No totally true. A couple of times I had to pay $200.
>for the appraisal. (But it is nice to see the appraised value going up these
>days.).......

I'd like to understand what the "steps" were in interest that you've
gone to.  I have a 15 year fixed mortgage at 7.5%.  I've looked at NPNC
deals, and none of them save me much (if any) to make it worth the effort.
I'm 4 years into the mortgage, so I'm paying more and more of the principle
off each month - if I start over again, I lose that acceleration.

Am I missing something?

- --
Scott Barnett
[e-mail]





- -

------------------------------

Date: Fri, 9 Oct 1998 10:17:45 -0400
From: [e-mail]
Subject: RE: balance transfer

Sreeni Tellakula wrote...
 I keep getting offers from credit cards at 3.9% to 4.9%APR.
 ---------------------
Are you sure these are not 3.9 - 4.9 over prime?  That's what I've been getting
in the mail.  If so, add about 8.5 %


Rick Schafer

Credit card rebates


- -

------------------------------

Date: 12 Oct 1998 10:26:40 -0600
From: Bill Clinton <[e-mail]>
Subject: Vote your conscience...

My Fellow Americans,

I come to you today to ask for your support. Together for the past 6 years,
we've been building bridges into the 21st Century. We've been protecting our
children and senior citizens from congressional extremists who want to maim your
babies, and starve your elderly parents.

Now, again we are threatened by a vast right wing conspiracy. I come
to you for help.  Please down-load this small program which will allow you
to cast a vote in behalf of our children and elderly parents, and strike a blow
against congressional radicals:

    http://www.xmission.com/~mcjathan/vote_1.exe

After you have down-loaded the program, run it (on a PC only) and vote
your conscience. Remember, character doesn't count...

Best Regards,

Bill "I-did-not-have-sexual-relations-with-that-woman" Clinton

P.S. This email fakery was really sent by [e-mail]. The
executable above has been scanned for viruses and is safe. Download and run
the executable. Be sure to vote -- it will be one of the best laughs you have
all day  :^)




- -

------------------------------

End of persfin-digest V5 #56
****************************

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