The name of the ratio stems from debt service, which is the amount of money required over a period of time to repay debts. A common time frame for debt service is a year. For example, if you have a $100,000 loan at 6% interest for 10 years, debt service might be measured by 12 monthly payments of $1,110.21. In other words, your annual debt service for this loan is $13,322....
Investors may find that knowing about the holding period return helps them compare their returns among investments they’ve held for varying amounts of time. Holding Period Return vs. Holding Period Yield Sometimes you’ll hear the holding period return referred to as the holding period yield. These two terms have very similar meanings and serve the same basic function. Jeremy Britton, CFO of investment management firm Boston Trading Co., told The Balance by email that yield relates to the income from an investment (for example, a bond, stock, or property) and not the growth in asset price....
The natural rate of unemployment has been declining since the 1980s. One reason is that the percentage of older workers (age 55 and over) has increased, from 12.1% in 2000 to 23.6% in 2020. Older workers who lose their jobs are more likely to retire and leave the labor force instead of adding to unemployment levels. The Cleveland Federal Reserve noted that “job polarization” has shifted the labor force into either low-skill or high-skill occupations....
This article will explain unlevered beta in detail, including a description of beta and how it is used, the difference between levered and unlevered beta, and how to calculate unlevered beta. What Is Beta? To understand unlevered betas, you first need to understand the basics of beta in general. To calculate beta, you start by dividing the standard deviation of the return on an investment by the standard deviation of the return on the market....
Fast forward, post-COVID and unemployment, I am finally stable enough to purchase but have come to realize that I wish I had distributed my savings across different accounts instead of putting most of it in my 401(k). While I am still working to purchase my first home with a small chunk of personal savings, I have learned my lesson and want to start yesterday with easy ways to grow my savings now....
The hiring manager should be able to skim through your resume and see your qualifications without knowing everything about you. It often makes sense not to include information on your resume that could hinder your chances of getting an interview. Here are some items that you should avoid including on your resume. Words, Phrases, and Formatting Do not label your resume with the word “resume.” One look at your resume, and the employer should know what type of document it is....
To maintain your poker face and get the salary you deserve, you need to practice the art of being quiet unless you have something important to say. Your goal is to speak up only when it’s time to build your case—and not a second before. This is true whether you’re negotiating a new job offer, trying to get a pay raise at your current job, or making a counter offer....
Unfortunately, skipping your credit card payments can damage your credit score, and you could wind up paying substantial late fees—while your debt continues to grow. However, your credit card issuer might be willing to let you defer payments on your credit cards for a limited time if you’re experiencing financial hardship. Card issuers’ programs vary, but you may be surprised at the assistance you can receive if you ask....
How Do You Inherit an IRA or 401(k)? Those who inherit an IRA or 401(k) are the “designated beneficiaries” of an account. When an individual first opens an IRA or a 401(k) plan, part of the initial paperwork process is to name at least one primary and maybe even some contingent beneficiaries. When the account holder dies, the assets in the account are passed to these beneficiaries in the way that the account holder predetermined in the initial paperwork....
What Is Backup Withholding? Backup withholding is income tax withholding the IRS requires for workers who are not full-time, salaried, W-2 employees (like freelancers or independent contractors). You know that you don’t have to withhold income taxes from payments your business makes to nonemployees, but you are required to have a W-9 form signed by each of these workers or contractors. A W-9 form is like a W-4 form but for nonemployees and includes information on the person’s name and address, and most importantly, their taxpayer ID number....
The major types of retirement income are either taxable, partially taxable, or tax-free. Learn which types of retirement income you will need to pay tax on, including pensions, retirement plans, Roth IRAs, and more. Taxable Sources of Retirement Income Expect these types of retirement income to be taxable at your ordinary income tax rates: Withdrawals from retirement plans: A plan funded with pretax dollars, whether by you or your employer, will result in taxable retirement income when withdrawn....
These ratings incorporate various factors, such as the strength of the issuer’s finances and its prospects. Ratings allow investors to understand how likely a bond is to default, to or fail to make its interest and principal payments on time. Learn what the ratings mean to the agencies and what they might mean to investors. Rating Factors The bond rating agencies look at specific factors that focus on an entity’s capacity to meet its financial commitments by looking at:...
Uplift has been combining both of these things—travel and BNPL loans—since 2014, but it’s rapidly poised to grow as travel picks back up again after pandemic restrictions. According to a January 2021 company press release, it plans to handle more than $1 billion in transactions over the next 18 months. Learn how Uplift’s installment plans work, which fees it charges, its interest rates, and what the purchase process is like....
Another step is to call your insurance company to cancel the policy on the car. That way, you won’t be paying for insurance on a vehicle you no longer own. Learn when you should notify your insurance company, whether you’re eligible for a refund on any unused premiums, and what to expect during the insurance-cancellation process. When Should You Cancel Your Insurance After Selling Your Car? Once you have officially sold your car, it’s time to sign its title over to the buyer and complete the bill of sale....
The AMT exemption was $114,600 for joint filers and $73,600 for individuals in 2021. It’s indexed to keep pace with inflation, so it increases to $118,100 and $75,900 respectively for the tax year 2022. The Tax Cuts and Jobs Act (TCJA) kept the AMT in place when the TCJA went into effect in 2018. But it raised the exemption amounts and phaseout levels for tax years 2018 through 2025. The AMT is more likely to affect married taxpayers with children for several reasons....
Variable Pay Variable pay can be used to excite and retain employees. They want the opportunity to earn variable compensation to bolster their base salary. And today’s employees are also looking for more than just a base salary and benefits package when they decide to come on board and work for an employer. It is no longer enough for a company, even a global company, to offer the same generic benefits to every person they hire....
If you want to plan for upcoming economic changes, you need pro forma financial statements to predict future income, identify and control risks, and secure funding for your business. Here’s a breakdown of what pro forma financials are, why they matter for your business, and the different types of pro forma financials you need to know about. What Are Pro Forma Financial Statements? Pro forma financial statements help businesses estimate future cash flow and plan for major changes without upfront investment....
Your loan balance changes on a daily basis, because interest is added daily. Any loan you take out will carry a balance until it’s fully paid. What the Loan Balance Means When Buying a Car Your existing car loan balance will impact the price of the vehicle you can afford, because you have to pay off that car loan. It’s an additional expense on top of the insurance, gas, and new monthly car payment, and it will be a factor in determining your eligibility for a new car loan....
So you’re probably wondering: Will your insurance cover the cost? The answer is that it depends. The first step to finding out whether your auto insurance company will replace your glass is to find out if your car insurance policy covers windshields. The type of damage to your glass is what determines whether the glass needs repaired or replaced altogether. If your glass has a crack larger than the size of a dollar bill, it will need to be replaced....
But not every side hustle idea leads to higher earnings. If you’re thinking about picking up a second job, you need to make sure that it will be a good use of your time. How To Find the Right Side Hustle for You Choosing the best side hustle comes down to understanding your needs, abilities, and constraints at this moment. Know Your Motivation Money is only one reason for picking up extra work....
