Bail Out Bonanza: How the current market could impact you

We have been watching this past weeks financial news with a close eye. We try and get a sense of how current market activities and news events might impact our clients and consumers in general. In doing some research here is what we found:

- Buying a home is most likely going to keep getting tougher. Down payment requirements are likely to increase, credit scores will carry heavier weight, and lenders will be more cautious.

- Credit card fees, banking fees, late fees and other costs associated with managing your personal finances should continue their rapid rise. Overall, fees and penalties levied by banks have been rising rapidly over the last few years. The current market activities will most likely allow this trend to continue. Banks and credit card issuers are hungry for steady and offsetting revenue streams, the fees they levy are a big source of this right now.

- Inflation is taking a step back. There was some concern over this summer that inflation was going to kick in pretty strong but for now at least that seems less likely. Buried in the news is the fact that oil is trading well under $100 per barrel and exports are still strong for the moment. With the fed keeping key rates steady, they are most likely wanting to keep inflation where it is.

- There is no bail out coming for the average American. While the appetite of the Fed for bailing out poorly managed mega companies seems endless right now, you are still on your own. Between increasing fees, more weight given to credit scores and no net underneath, now is a critical time to make sure you have your finances in order.

Media pundits have given plenty of airtime to discussions about where to invest, how to manage your portfolio or how to diversify during this difficult market. What is just as important but often overlooked is the fact that managing your daily finances carries significant weight in your long term financial success.

At PPS, we work to make sure our clients bills are paid on time and that they have a clear understanding of their monthly expenses. This way, they are more likely to have a healthy and stable daily financial footing.

Our monthly minimum for service is $150. Many of the people we talk to everyday say that they pay that amount or more each month in penalties, late fees, overdraft charges and in weakened credit scores. For many of our clients, the return on investment for hiring a daily money manager already makes sense. I think that in the months and years ahead, that ROI will simply get stronger.

Devin