Money Blue Book

I’m thinking of a number…between 450 and 850. Do you know what it is? It’s my credit score, and it happens to be be 720.

Ok, my credit score is actually 750, but I’m sure you’ve heard that commercial before from freecreditreport.com. It’s the one where the guy is sitting on a producer’s chair talking about his credit score in front of a plasma tv. Well I’m here to warn you not to fall for their slick advertising. Their marketing technique is very clever but seemingly misleading. The free credit reports they offer are not truly free as most people would understand it. You have to enroll in their credit monitoring trial program to obtain your complimentary report. If you don’t cancel within the trial period, you will be charged.

AnnualCreditReport.com is the Only Official Free Credit Report Site

There is only one truly free way to obtain your credit report, and that is through AnnualCreditReport. There are numerous sites out there that claim to offer “free credit reports”, “free credit scores”, or “free credit monitoring” but none of them are part of the legally mandated and official free annual credit report program. In most cases, the so-called credit report product comes with strings attached.

By law everyone is entitled to a free copy of their credit report from the three major credit agencies, Equifax, TransUnion, and Experian, upon request once every 12 months. These credit reports usually cost upwards of $10 each. It’s a good idea to keep tabs on your credit report and credit score periodically for any fishy fraudulent activity. It’s also a good idea to know where you stand in the eyes of lenders. Don’t worry, requesting your own credit report is considered a soft credit check and won’t have a negative effect on your credit score.

Your credit report will contain a snapshot of your entire payment history, accounts, balances, and payment history. Keep in mind that even though you are allowed by law to receive a free credit report every year, the free report does not come with a free FICO credit score, the three digit number that lenders use to gauge your credit worthiness. It’s disappointing that the free credit report doesn’t come with a credit score, which some consider just as if not more important than the actual report itself. Hopefully future government legislation will allow everyone to get their credit score as well. Currently, you will have to pay extra to get the score.

How To Request Your Free Report

To get your free credit report, simply visit their website at AnnualCreditReport.com or call (877) 322-8228. You will have to provide identification information such as your name, address, and social security number. The website is jointly operated by the 3 major U.S. credit reporting agencies and each has to provide you a free copy of your credit report. You have the option of requesting reports from all three credit agencies at the same time, or you can choose to stagger the three requests as some experts recommend to better monitor your credit throughout the year.

What If You Already Used Up Your One Free Annual Credit Report

If you have already requested your free annual credit report within the last 12 months, you will have to wait until the 12 month period is over before you can request again from AnnualCreditReport. If you’ve already used up your free official credit report for the year, your other choices include taking advantage of the 1 month credit score and credit report trial offers provided by sites such as MyFico or Equifax. They will provide you your complimentary credit report and score for enrolling in their credit monitoring program’s trial period. Just remember to cancel the trial service if you don’t plan on using it after the trial period. Some people do choose to keep the service as they find the monitoring service to be useful. If you want to take advantage of trial offers to get your complimentary credit report and score, my suggestion is to stick with the major companies. There are many shady sites out there looking to steal your confidential information, so please be careful.

Other Ways To Get A Free Credit Report

There are few remaining ways to get your free credit report if you’ve already tapped out the AnnualCreditReport.com option. By law you can get a free report if:

• You are unemployed and seeking employment in the next 60 days.
• You are receiving public welfare assistance.
• You believe there are inaccuracies in your report due to fraud or identity theft.
• Also, if you were denied credit based on information found on your credit report, you are entitled to a free copy of your report from the credit bureau that supplied the credit report. This entitlement would arise if you were denied insurance, rental housing, or employment due to issues found on your credit report.

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For those curious or willing to take on the challenge of learning a new investment methodology, Trading Concepts Inc offers a home study package on how to trade Emini futures.

Eminis are electronically traded futures that are much smaller than existing futures contracts traded on the Chicago Mercantile Exchange. The claimed advantages to trading Emini contracts include greater liquidity and flexibility. The most popular Eminis are those that track popular stock indexes such as the S&P 500 or the Nasdaq 100.

The home study Emini Trading System course provides a wide assortment of preparatory material, including a 250+ page comprehensive manual, 4 professionally shot video tapes (50+ page manual), 3 hours of professionally recorded audio cd’s (50+ page manual), unlimited phone/e-mail consultation, free unlimited access into the members area, and a free day of market training.

It Does Take Personal Effort and There Are Risks

Trading Concepts Inc. claims that the average student will take roughly one to two months provided they are prepared to spend between five and eight study hours on the course a week, to learn and actually begin using and profiting from Emini trading.

The company’s website does acknowledge that while futures and options trading offer potentially significant rewards, day trading does involve high risks and you can lose a lot of money. As always, please do very thorough research, and be careful.

After spending some time on the sidelines, I think it’s time for me to get back into the whole 0% balance transfer game, also known in some circles as the App-O-Rama (insert ominous lightning and thunder crack).

The App-O-Rama Game – What Is It?

For those of you unfamiliar with the concept, the App-O-Rama (more formally known as credit card arbitrage or balance transfer arbitrage) is a way to generate money through the calculated use of interest free credit card balance transfers. The process operates by you opening numerous credit cards that offer special introductory 0% APR balance transfer rates. The introductory period is often up to a year long, during which time you deposit the balance transfer funds into a high yield savings bank account. Essentially you are making money from borrowed money for an extended period of time. At the end of the introductory period, you promptly pay everything back in full and you pocket the savings interest as profit.

The process requires prior preparation and may be difficult for some people to automate and pull off without a hitch. Participation is certain to negatively affect your credit score in the short term and there are also many hidden dangers as well so it’s certainly not suitable for some people. It is definitely not recommended for those people who need to maintain excellent credit because they are planning on buying a new house or car in the next 12 months. It is also not recommended for those who are disorganized or are unable to handle the responsibility of using and paying off credit cards.

But for others, if you do your research and plan everything carefully and thoroughly, credit card arbitrage can be a great way to earn remarkable and relatively effortless profit. The more credit you are willing to take on and transfer, the more you”ll earn in interest.

Preliminary Steps Before Beginning the Credit Card Arbitrage Process

I am still in the initial preparation stage. Before I start the App-O-Rama, I need to first complete several preliminary steps:

1. Request and examine my free credit report – Before I begin I need to know my current credit status. By requesting and examining my 3 credit reports and free credit score, I can determine how much of my existing credit I am using and my current credit worthiness. This will also allow me to more accurately track the extent of the temporary credit score hit that is bound to occur when I start the process.
2. Examine and carefully evaluate all future credit-dependent plans for the next 12 months – Participating in the App-O-Rama is certain to ding your credit score at least for the short term. If you plan on applying for a loan to buy a house or a new car in the next year or so, then credit card arbitrage probably isn’t right for you. In that case, you’re better off keeping your credit score as high as possible.
3. Research banks and narrow down the savings accounts that will provide you the highest interest rates possible – I’m sort of bummed that interest rates have dropped recently due to the Fed’s recent decision since this will decrease my App-O-Rama returns, but all is not lost. There are still banks offering 5% APY interest or more.

I know some people will say there’s no free lunch and will think that I’m nuts, but the process really works. I’ve done it before, although on a much smaller scale. Once I have taken care of this preparation stage, I will write about my experience.

My FICO credit score is currently 750 and due to the terrible housing market, I don’t plan on buying a new house in the next few years. How much 0% credit card loans do you think would be reasonable for me to take on?

My investment portfolio is up more than 40% so far this year. I accomplished this by taking advantage of the serious growth potential in the developing markets, primarily in Asia.

I think investors these days are much too risk adverse. Now if you are only only a few years away from retirement I understand why you would choose asset preservation first, but for those of you in your 20’s or even 30’s, why are you so afraid of losing money in the market? After all, stock markets have always cumulatively trended upwards historically given a long enough investment horizon. By overloading with safe conservative investments, you are greatly limiting your possible returns.

China Is Booming and Growing Rapidly

Due to its sheer size, massive population, and capitalistic ambitions, China will be the focus of the world’s economic growth for the next few decades and is on track to develop into the world’s next economic superpower. China’s gross domestic product currently expands at more than 10% a year, compared to only 3% for the United States.

If you want to see your money grow to its greatest potential, investing in American or developed markets alone won’t get you to that result. If you are content with steady growth, then stick with the usual S&P 500 type value funds. But if you desire growth and are willing to take on a reasonable amount of calculated risk, you really need to get on board the China train.

I jumped on board earlier this year and invested a large sum and proportion of my investment portfolio into Fidelity’s Southeast Asia Fund (FSEAX). FSEAX’s major holdings include solid companies like China Mobile, Samsung, PetroChina, HonHai Precision, and Taiwan Semiconductor. The companies represented are from rapidly growing markets like China, Hong Kong, Taiwan, Singapore, and South Korea. Take a look at FSEAX’s 85% percentage growth compared to the S&P500’s 13% within the last 12 months. The difference is astounding.

Bubble Talk

There is some speculation that a bubble is forming in China’s financial markets and that the current growth rate cannot be sustained. That is always a possibility but I don’t see it happening. Conditions are not as irrational or purely speculative as they were during prior recent crashes. With the 2008 Beijing Olympics coming next summer and the continued devaluation of the U.S. currency, I feel the pace for the emerging Asian markets can be sustained. Of course there probably will be a few major but healthy corrective pullbacks along the way.

My Picks and Watch List

Because buying foreign stocks can be rather difficult if you don’t live in the target country, the best way to invest in China or in any of the other emerging Asian markets is to buy into a mutual fund or exchange traded fund. Here are a few you might want to take a look at. Remember, caveat emptor (let the buyer beware).

1. Fidelity South East Asia Fund (FSEAX) – Mutual fund with expense ratio of 1.04%
2. iShares MSCI Taiwan (EWT) – Exchange traded fund
3. iShares MSCI South Korea (EWY) – Exchange traded fund
4. iShares FTSE/Xinhua China 25 Index (FXI) – Exchange traded fund – Super risky but it has experienced the greatest surge.