Definition of the Day!

Definition of 'Back-End Ratio' A ratio that indicates what portion of a person's monthly income goes toward paying debts. Total monthly debt includes expenses such as mortgage payments (made up of PITI), credit-card payments, child support and other loan payments. Lenders use this ratio in conjunction with the front-end ratio to approve mortgages. Also known as "debt-to-income ratio".

Investopedia explains 'Back-End Ratio' For example, if your monthly income is $5,000 ($60,000/12) and your total monthly debt payments are $2,000, your back-end ratio is 0.40 or 40%. Generally, lenders like to see a back-end ratio that does not exceed 36%; however, there are lenders who make exceptions for ratios of up to 50% if you have good credit. Some lenders consider only this ratio when approving mortgages, as opposed to using it in conjunction with the front-end ratio.

Student Financial Aid Change for 2013.

IRS Data Retrieval
The FAFSA filing process has changed, and it is recommended that all students use the IRS Data Retrieval tool to obtain their or their parents' federal tax return. Using this tool will eradicate common errors on FAFSA forms, and keep your application for student financial aid running smoothly. Tax information is available through the tool approximately 2-3 weeks after tax return submission, and by now all data should be in and finalized. Also keep in mind that Federal 1040 tax returns are no longer an acceptable form of verification for the FAFSA.

For more changes go to: http://www.investopedia.com/articles/personal-finance/081413/student-financial-aid-changes-fafsa-2013.asp

Obamacare: Separating Truth from Fiction

I have heard many of these statements recently, this Yahoo article might clear some of those up.

http://finance.yahoo.com/blogs/daily-ticker/obamacare-separating-truth-fiction-know-121733560.html

New Feature...Definition of the Day!

With the help of "Investopedia" I'll provide a definition of a financial term here at my blog. Education is a huge part of what Your Safe Money Show is all about so I hope you enjoy this new feature!

Definition of 'Abstract Of Title'

A brief history of the titles for a piece of land. The abstract of title lists all of the legal actions that have been performed or used in conjunction with a piece of property. This is used to determine whether or not there is any kind of claim against a property.

http://www.investopedia.com/dictionary/

Benefit's of Roth IRAs.

The Roth IRA is an amazingly versatile product. Its primary purpose is to provide a tax-advantaged way to save. But unlike other retirement-savings accounts, Roths let you use the money for a variety of purposes without triggering crippling taxes or early-withdrawal penalties. A Roth won't reduce next year's tax bill, but the payoff comes later as earnings withdrawals are eventually tax-and penalty-free. (Kiplingers)

How Long Will the Government Shutdown Last?

Shutdowns in the past have been anywhere from a few days to 3 weeks. Here's 7 things you won't have to worry about with the shutdown.

http://money.cnn.com/2013/09/30/pf/government-shutdown-consumers/index.html?iid=Lead

Todd's Tip of the Day!

Having your home and your car insured through the same insurer might attract discounts.

You can be eligible for multiple insurance discounts by getting your home and car insured through the same insurer. Most insurers are happy to give discounts when you purchase more than 1 insurance policy from them. Believe it or not, you can save as much as 20% on your insurance costs if you purchase several policies from the same insurer. Most of the insurers offer both auto and home insurance policies. So, you won't have problem in purchasing the insurance policies. Make sure you compare the premium rates charged by several insurers. This will help to determine if you should stick to your current insurer.