ShareBuilder is offering customers a $100 cash bonus if they transfer their account from a competing brokerage. This offer is available to new and current customers. Many account transfer offers are only available to new customers at the time of account opening, making this a more unique deal.

To qualify for the $100 ShareBuilder bonus you have to transfer your entire account balance to ShareBuilder from a competing brokerage (minimum of $500). You must provide a copy of your most recent brokerage account statement for ShareBuilder to verify you are transferring your entire account.

ShareBuilder $100 Account Transfer Bonus

1. Open a ShareBuilder account, or Log in to your current account.
2. Print and complete an Account Transfer Form (available from within your account, or when you open an account).
3. Activate your $100 bonus in an eligible account. Use Promotion code: TRADEUP100.
4. Mail or fax a signed transfer form and a copy of your most recent statement to ShareBuilder.

Here is the fine print:

† $100 Transfer in Bonus: ShareBuilder will deposit a $100 bonus into your account after completing a full brokerage transfer of $500 or more from a competing broker to ShareBuilder. The $100 bonus offer is available for Individual, Joint and Custodial accounts only. Offer not valid for IRA or Education Savings Accounts. The $100 bonus will post to your account approximately 4-6 weeks after completing a full brokerage transfer from a competing broker and is not available for withdrawal for 180 days. This offer is not valid with any other offers and is non-transferrable. Limit one ShareBuilder promotional award per unique customer or custodial beneficiary. ShareBuilder reserves the right to terminate this offer at any time and to refuse or recover any promotion award if ShareBuilder determines that it was obtained under wrongful or fraudulent circumstances, that inaccurate or incomplete information was provided in opening the account, or that any terms or ShareBuilder’s Account Agreement has been violated.

Is it worth it?

A one time $100 bonus is nice and there are other benefits to consolidating your financial accounts, including fewer logins, centralized management, and easier asset allocation. This offer is a good deal if you were already considering moving your assets out of your current brokerage. For more information regarding ShareBuilder and whether it meets your needs, check out this ShareBuilder Review or compare ShareBuilder to the best online brokerage houses.

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While the title of this article may sound fairly straightforward there is actually quite a bit of misconception floating around when it comes to comparing individual health insurance vs. group health insurance. Let’s take a look at some of the differences between the two major types of health insurance coverage in the United States and see if maybe you can pick up a few things that will help you understand what the best way to find affordable health insurance coverage really is for your specific situation.

Defining the Two Types of Coverage

I will certainly not take it for granted that everyone reading this article already understands what the terms “individual health insurance” and “group health insurance” mean. Here are the official yet unofficial definitions of the two direct from me:

Individual Health Insurance – This type of coverage is purchased on the private market by a single person for themselves or their families. This coverage can cover more than one person (i.e. the entire immediate family) and is not “just for one person” as some people commonly mistake the “individual” in “individual health insurance” to mean.

Group Health Insurance – This type of coverage is designed specifically for companies to buy for their employees. These plans can be purchased on the open market just like individual coverage (by the employer and not the employee) or they can be a self insured plan set up by the company (typically seen with larger companies) or a combination of the two (i.e. self insured up to a certain limit and then 3rd party catastrophic coverage kicks in for any very large bills incurred by employees).

Now that you understand the basic definitions of group health and individual health then lets take a look at some of the important differences between the two.

Important Differences Between the Two

Once you read through this list of some of the key differences between group and individual health insurance coverage then you will likely be light years ahead of the average health insurance shopper. As the owner of an independent health insurance agency in Florida I can’t tell you how many times our agents have seen the “light bulb go on” while explaining/teaching clients some of these important distinctions:

1. Cost – Individual health insurance is MUCH cheaper than group health insurance is almost every state in the US. When I say MUCH cheaper I really mean that because typically the cost of an individual health insurance plan will run about half of the cost of a similar group health insurance plan (this is even when you compare plans from the exact same company for almost exactly the same amount of coverage). See difference #2 “Underwriting” below to understand why individual health is so much cheaper than group health.
2. Underwriting – With a group health plan every single person that applies for coverage is accepted onto the plan (assuming you are an eligible employee of the group) – no one is denied coverage because of pre-existing conditions (previous/current health issues). Most group plans will not always cover your pre existing conditions right away as there is typically a waiting period before they are covered IF you have not maintained continuous health insurance coverage. But as long as you have done the responsible thing and never had a lapse in coverage then you will automatically be approved for coverage as soon as you apply for a group health plan and you will have all of your pre existing conditions covered right away. Contrast all of this to the underwriting for an individual health insurance plan and unless one qualifies for a guaranteed issue health plan because of the Federal HIPAA laws, then companies offering individual health insurance get to pick and choose who they will approve for coverage (this is true in most states – guaranteed issue states like New Jersey are extremely expensive because if the insurance company is required to approve everyone for coverage no matter what health issues they have, then who wouldn’t want to just go without insurance until they develop a major illness?).
3. Maternity – Maternity coverage is included automatically in almost every group plan, while maternity coverage is by default not included with an individual plan (although most insurance companies offer maternity coverage to be added onto their individual health insurance plans as an extra benefit that you can obtain by paying higher premiums).

If you have a firm grasp on the 3 key differences above then you have a great foundation for starting to make some smart decisions when finding health insurance (decisions that will most likely save you a nice sum of money). Here are some strategies that you can use to put your new found health insurance knowledge into action.

Find Cheap AND Comprehensive Coverage

Before we jump into some strategies I just have to interject that now is an appropriate time to very quickly mention that just because I said the word “cheap” in the same sentence as “health insurance” that does NOT mean that I am advocating going out and buying one of those $29.99/month discount health cards that you see advertised on TV at 3 in the morning.

If you want real coverage when you develop a major illness then you need to purchase real health insurance and not just a discount card. Even if you can get a great discount of say, 50% off of all medical procedures (highly unlikely), you can still stress your finances if you develop cancer or some other very expensive illness. Whether you have to pay the full cost of $300,000 or the discounted price of $150,000, you have just needlessly put your family and your financial future at risk (keep in mind that many large medical bills are recurring monthly charges for ongoing chemo treatments, medications, etc. and you can very quickly fall behind even if you think that you have the funds to self insure).

If you are unsure of where to start then work with a trusted independent health insurance agent (”independent” meaning that they are not tied to just one insurance company but can work with many companies and help you find the best plan from any number of different companies). Stick with the large and well known insurance companies and not fly by night infomercial companies because chances are if you have never heard of the insurance company before, then maybe your Doctor hasn’t either. Do your homework online and read reviews of United Healthcare, reviews of Blue Cross Blue Shield, reviews of Aetna, and other health insurance providers so that you can work with your independent insurance agent to find not only a cheap plan, but a cheap plan from a trusted company that offers comprehensive major medical health insurance coverage.

Strategies for Finding Cheap Health Insurance

Now is the time to put your new health insurance knowledge to work saving you some money. Granted, everyone’s situation is different and options and laws vary from state to state (health insurance is regulated on the state level rather than the federal level), so use these strategies as general guidelines rather than hard and fast rules. Overall this is a decision making framework that everyone in the US can use to find the best health insurance:

1. If you are offered group health insurance through your employer and the employer is paying all or most of your premiums, then chances are you should sign up for the group plan because it’s basically free money at that point. You are unlikely to find an individual health insurance plan that is less than 1/3 of the cost of the group plan.
2. If you are offered group health and your employer is paying your premiums but is not willing to pay the premiums for your spouse or children, then as long as your family is relatively healthy you should almost always opt for a group plan for you and an individual plan purchased on the private market for your spouse and children. Often, you can even find similar individual health insurance coverage from the same insurance company for your spouse and kids as what you have, that way you will know for sure that your family Doctor’s and hospitals all accept your insurance.
3. If you have major health issues (cancer, recent heart attack, many expensive prescriptions, etc.) and you have the opportunity to get group health insurance then you should take the group health insurance coverage because even if you are approved for an individual health insurance plan (unlikely because of your major health issues), you will likely get those major pre existing conditions excluded from coverage (or sometimes they will drastically increase your premiums in order to still cover those conditions).
4. If you are perfectly healthy and your employer is not willing to chip in much at all towards your group health plan then you almost always will save money (often a substantial sum of money) if you compare individual health insurance benefits out on the open market.
5. If you have major health issues and you currently have health insurance but are concerned that your current coverage might not last (because you are leaving your job or your COBRA coverage is set to run out soon or any other number or reasons) then you should ask a knowledgeable agent or financial planner about the HIPAA health insurance laws. HIPAA laws offer very specific protections to people who have done the responsible thing and maintained health insurance coverage but through no fault of their own have lost coverage and are unable to get coverage. In these circumstances the HIPAA laws require insurance companies to offer an individual health insurance plan on a guaranteed issue basis that covers all pre existing conditions from day one. The HIPAA laws are not often talked about and are not even known by most agents. But to do a full write up of how HIPAA can help health insurance shoppers is a topic for another article on a different day.

Now that you understand the differences between individual health insurance and group health insurance and you are equipped with 5 strategies for saving some of your hard earned money when buying health insurance, it is time to put your knowledge into action. Just like it is very important to shop around and put into action the various ways to lower your auto insurance rates it is also the same with with health insurance. Be sure to do your homework and compare quotes from many different health insurance providers to find the plan that will best meet your needs. What additional strategies do YOU have for finding a cheap health insurance plan?

About the Author: Joel Ohman is a Certified Financial Planner and President of 360 Quote LLC.  He is a serial entrepreneur and is currently spearheading several successful consumer comparison websites including Credit Card Chaser and Health Insurance Providers.

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Gift cards are a multi-billion dollar business and one of the most popular gifts for Christmas, birthdays, and other events. It’s easy to see why – some people are notoriously difficult to shop for, and others prefer to do their own shopping. But not all gift cards are created equally.

What to look for when giving gift cards this holiday season

Before making your purchase, you should realize there are pros and cons to giving gift cards: They are convenient and easier to ship than gifts, but they are also impersonal and may come with unpleasant surprises like fees, inactivity costs, and expiration dates. Here are some things to look for before buying gift cards:

Look out for fees! Read the fine print before purchasing gift cards because some of them come with an automatic monthly or annual fee. Some cards may not begin charging fees until a certain amount of time has passed. The fee and time limits vary, but it’s not unusual to hear about a 2% monthly fee, or a flat rate fee of several dollars per month. These fees are more common with third party gift cards and are less common with gift cards for a specific store.

Avoid gift cards with expiration dates! Again, read the fine print before purchasing gift cards and be sure to look for expiration dates. Many store gift cards don’t have expiration dates, nor do other cards like those from American Express.

Where can the card be used? Many gift cards can only be used at certain stores, while other gift cards can be used anywhere. You should also check whether or not store gift cards can be used online as well as in the store because some store cards can only be used in stores. I ran into this problem before and had to wait almost a year before I could use the card because the item I wanted to purchase was only available online. It was frustrating!

What to do with unwanted gift cards

Send them to me. Just kidding! There is a huge secondary market for gift cards and you can buy, sell, and trade gift cards at a discount. You may take a small hit on the face value of the card, but at least you won’t have to worry about not being able to use it. You can read more about buying and selling gift cards.

Which gift cards are the best to purchase or give as gifts?

You want to make sure you get the most out of your gift cards, so the most important thing you want to consider is whether or not the recipient will use the gift card. If you are confident they will use it, then shop for a gift card to their favorite local or online store. Just be sure they will have access to use it. Some of the most popular gift cards include Amazon.com, The iTunes Store, The Apple Store, and Best Buy. You can also go with a non-store branded gift card, such as one that bears the MasterCard, Visa, or American Express logo. These cards can be used at virtually any location that accepts these credit card brands.

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People are lazy by nature. I know, I’m guilty of it myself. It’s too easy to set up a process, get it running smoothly, and forget about it. Unfortunately, leaving things in a state of inertia can cost us money. But the good news is that there are probably dozens of things you can do in a few minutes that will benefit your bottom line.

Save and earn thousands with these tips

These tips are broad in nature, and can help you save or earn thousands of dollars over the course of a lifetime, or even over the course of a few years. Not every one of these tips may apply to your specific situation, but chances are you can apply one or more of these tips.

Money management and budgeting

The first step to organized finances is knowing and understanding where your money is coming from and where it is going. The next step is being proactive and managing your money instead of letting it manage you. Using a budget will help you control your spending and give you a better idea of where your money leaks are. Plug the leaks and control your spending and you can save thousands over the course of your lifetime. Where to start: Popular money management programs include Quicken, Mint, and a host of free online money management tools.

Paying and earning interest

Compound interest is one of the most powerful forces in the universe – which is why you want it working for you, and not against you! If you have debt, try this short exercise to see how much interest you are paying each month: Grab a recent copy of your bills, write down much you borrowed, your monthly payment, and how much you pay toward the principle and how much goes toward interest. The result may shock you!

Reduce the amount of interest you pay. Hopefully that exercise above helped you realize how much money you are giving away each month, and how much more money you could direct toward your personal goals. There are several ways you can reduce the amount of interest you pay, including a do it yourself debt consolidation plan, transferring the balance to 0% credit cards, applying for a lower interest loan, and increasing your monthly payments.

Increase the amount of interest you earn. If you are using a local bank for your savings account, you are probably earning less interest than you could with an online bank. Look for a bank that offers higher interest rates, no fees, and other features. You can also check out alternatives to high yield savings accounts for additional ways to earn more interest.

Not investing

Unless you are already wealthy you will need to save and invest for your retirement or other large expenses. Even if you are independently wealthy you should invest to grow your money. If you work for a company that offers a 401k plan, then you should be contributing at least the minimum to get the company match. Why pass up free money?

If your company doesn’t offer a company match, then there are other ways you can invest for retirement with a  tax deferred retirement plan. One of the most popular ways to invest is with a Traditional or Roth IRA, which both offer tax benefits. I’m a huge believer in the Roth, and if you think it may be for you, then I recommend reading about how to open a Roth and where to open a Roth for more information.

Paying too much for insurance

I’ve been guilty of this in the past. Its too easy to set up your insurance once and forget about it. But insurance rates can change and it’s a good idea to get new rate quotes any time you experience a major life event such as getting married, having children, moving, etc. It’s easy to get an online insurance quote – just visit a site like Geico or AllState, type in a few numbers and receive your quote. Here are some additional tips for saving money on car insurance rates, and saving money on homeowners insurance rates.

Improve your credit score

Your credit score itself doesn’t make you wealthy or poor, but it can have a huge impact on the interest rates your are able to get when you apply for a loan. Take a few minutes to learn how your credit score is figured, then look at how you can improve your credit score. A higher credit score can save you thousands of dollars over the course of a long term loan.

Just a few minutes work can make a huge impact

None of these tips take long to implement. At most you are looking at 15-30 minutes of your time to potentially save or earn thousands of dollars. That is a small investment of time can pay off for years.

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I am always looking for new writers to expand the boundaries here at Cash Money Life. Additional writers help extend the conversation and add other viewpoints to this website, which is great for everyone!

Benefits of writing for Cash Money Life

Writing for Cash Money Life is a great opportunity to share your experience with a large readership and gain experience and feedback about your writing. If you are a blogger or writer, this is a great way to build your professional portfolio and/or drive traffic to your website.

Writing opportunities

I am interested in publishing articles by guest authors as well as adding a paid writing position or two for approximately one article per week. The paid articles would be on a freelance basis and would not indicate employment by Cash Money Life. Please contact me for more information including article requirements and payment details.

Guest post guidelines for Cash Money Life

Guest Posts do not receive payment but are a great way to gain experience and exposure for your website, or to build your portfolio. Please use these guidelines:

• Articles should be well-written, must be original, and should not have been previously published elsewhere.
• Articles should be related to personal finance, career, or small business topics. Please e-mail me with proposed topics if in doubt.
• Please include a short author bio with a link back to your website and RSS feed if applicable.
• Feel free to add a reasonable number of links back to your own web site within the content, but please do not use this as an opportunity to stuff the article full of keywords.
• I retain full editorial and approval rights, including removing and/or substituting links.
• No affiliate links.
• Feel free to send image recommendations with the article. Please only include images that allow for derivatives unless you own the image (Flicker is a great source of images that allow for derivatives under the Creative Commons License).
• Guest posts can be republished on your site after a minimum of 3 months have passed.
• Please send articles in html or in a Word document (html preferred).

If you are a writer and would like to submit an article for consideration, please send me a message via my contact form. I look forward to working with you!

What is the difference between the paid articles and guest articles? Ownership. Paid submissions become the property of this website; guest articles may be republished by the author after a minimum of 3 months has passed. Anyone can apply for either position at any time.

Recommended personal finance and career articles

• Why We’re Not Buying Life Insurance (Yet). My wife and I skipped life insurance when we were newlyweds. We were both professionals and had no real need for it. But our situation changed when we had our first child.
• How to Sue Debt Collectors. Great information if you have been abused by debt collectors who do not follow the law.
• Why Are There Homeless Veterans In America? An op ed piece from Financial Samurai. And one there is no clear answer to.
• How Much Does Your Debt Cost? Probably a lot more than you think it does!
• What Business Should I Start? Follow your passions when starting a business.
• One Year After Getting Laid Off – My Annual Passive Income Report. An entrepreneur shares his story about striking out on his own.
• Interview Your Interviewer. Great tips for your next interview.
• 2009 Roth IRA Contribution Limits. You still have until April of 2010 to contribute, but planning now is a great idea!
• ABCs of Investing had a great stocking stuffer idea – a short beginner investing book.
• Amusing Ticker Symbols. Some amusing stock ticker symbols such as MOO, PBJ, and more.
• Open Enrollment Window Ends Soon. An important reminder for those of you who need to make health insurance elections.

This week’s carnivals:

• Carnival of Money Stories – My Money Flaws Edition @ Gather Little by Little.
• Festival Of Frugality #203 – American Flag Edition @ Domestic Cents.
• Baby Boomers Blog Carnival Thirteenth Edition @ Baby Boomers U.S.
• Carnival of Financial Planning @ My Trader’s Journal.

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After a long hiatus from the online DVD rental game, my wife and I signed up for a Netflix trial and became subscribers again. Why? Because they offer the best value of all the online DVD rental companies and make a great substitute for renting movies from a brick and mortar store, buying movies, subscribing to premium movie channels, or even dropping cable or satellite TV altogether.

Netflix Review

As I’m sure you already know, Netflix pioneered the DVD rental by mail business with unlimited DVD rentals and no late fees. Netflix now offers several new features and price packages which make their plans a better deal than ever. Perhaps the most unique feature is the ability to rent DVDs via mail and stream movies over the internet.

How Netflix works

Netflix is easy to use – simply sign up for an account and start adding movies, documentaries, and TV episodes to your movie queue. You will receive movies in the order they are selected, and you can make changes at any time. Netflix also offers unlimited online video streaming with certain plans. You pay a monthly fee based on the number of disks you want to rent at a time, with free shipping both ways, and no late fees.

Online video streaming and other Netflix features

Netflix offers several price options, all but one of which are unlimited plans, which offer you unlimited DVDs sent to your home and unlimited online movie rentals via streaming.

Online movie streaming. Movie streaming is one of the best “new” features to Netflix. I say “new,” but it has been around for awhile now, just not since I last used Netflix. You will need a fast internet connection to truly enjoy the movie streaming, otherwise the picture and sound may be choppy. But that would more likely be due to the connection, and not from the Netflix side of the house. A great feature with online video streaming is the ability to pause, rewind, fast forward, and pick up where you left off. The $8.99 monthly price plan features unlimited online movie streaming, which is an excellent deal if you watch a lot of movies. The biggest downside to the online video streaming is the limited number of online movie choices, as not all new releases are available for video streaming (however, the selection of TV shows, documentaries, and other media is excellent). When used in conjunction with the DVDs by mail and your queue, you can make sure you’ve got great movies any time you want them.

Video game console integration and Netflix players. Right now the Microsoft XBox gaming console and the Sony PlayStation 3 have the ability to stream Netflix movies, and there are rumors that the Nintendo Wii will begin offering this ability next year. You can also stream online movie rentals through TiVo, a Roku player, which plays movies from Netflix and Amazon Video On Demand, through some Blu-Ray players, or directly through your computer or TV if it is connected to the internet.

Other Netflix features:

• Blu-ray movies. Netflix offers a wide range of Blu-ray movies, and they are constantly adding more Blu-rays to their library. That’s good news if you have a Blu-ray player.
• More distribution centers than the competition. Netflix has several distribution centers throughout the US, which minimizes the time it takes to process and mail your movies. So you should have a better turn around time, resulting in more movie rentals per month. As a side note, some DVD companies have admitted to throttling, which is limiting the number of new DVD releases or premium rentals their top users receive in any given month, but I have never experienced this.
• Movie recommendations, reviews, and community. The Netflix software will automatically suggest movies based on your past movie rentals, and you can read ratings and reviews of each movie before adding it to your queue. The Netflix community allows you to share movie lists with other members, exchange e-mails, etc.
• Vacation plan. you can put your subscription on a vacation hold while you are away so you don’t pay for a service you aren’t going to use.
• No commitment. Netflix does not require an annual commitment – simply pay month to month and quit at any time.

Netflix Price Plans

Netflix pricing is actually very reasonable if you subscribe to the lower level plans, but it can get a little expensive with the higher tier plans. But let’s face it – with unlimited online streaming, most people won’t need to elect the higher plans if they have the components in place to stream online movies. The $4.99 price plan is the “Limited Plan,” which only offers 2 rentals per month and 2 hours of streaming – barely enough to watch average length films, and not long enough to watch many movies. That makes the $8.99 price plan the best value for most people. Here is a chart with the Netflix pricing plans.

*Blu-ray movies price plans. Netflix offers Blu-Ray movies for an added fee. Add $1 to the “limited plan,” and $2, $3, and $4 to each of the other plans. The Netflix Blu-ray inventory is continually growing, which is good news for those of you who prefer HD movies.

How Netflix compares to the competition

We chose Netflix for its convenience and variety of features. The main competitors fall in 3 categories: brick and mortar video rental stores (BlockBuster and Hollywood Video), online video rentals (BlockBuster Total Access), and one day DVD rentals from a kiosk (like RedBox and BlockBuster).

How Netflix compares:

• Brick and Mortar: Netflix is hands down the winner – unlimited dvd rentals for less than the price of 2 rentals at a store, plus the ability to set movies in a queue and stream movies online.
• Online DVD rentals: Netflix offers a wider variety of movie selections and online video streaming; BlockBuster offers in store trades (read full BlockBuster and Netflix comparison for more information).
• DVD from a box: RedBox, BlockBuster, and others offer DVDs for a $1 a day, but they are usually limited to new releases and a few select classics. I would only use these as a supplement to Netflix if the movie I want is buried in my queue and it might take awhile before I receive it. Otherwise the selection and online movie streaming make Netflix a clear winner.

Can you save money with Netflix?

If you subscribe to multiple premium movie channels for the movies and not for their exclusive content, then absolutely. If you rent multiple movies each month from BlockBuster or Hollywood Video, then the answer is also yes. You can also save money if you are the type of person who buys several movies each month, watches them once, then doesn’t watch them again for several months, if ever. The key to saving money with Netflix is to change those old habits and drop the extra movie channels, stop renting from the store, and stop buying movies you won’t watch often.

You probably won’t save money if you only watch a couple movies each month, or prefer to borrow movies from the library, regardless of which movies are available (I fell into this last category for a long time; it was great to catch up on movies I had missed, but I was missing out on all the new releases!). I’m not really saving money with Netflix because we used the library for a long time, but this is a small luxury I am willing to pay for.

Free Two Week Netflix Trial

Netflix offers new customers a free two week trial to their service. If you like it, then you continue with the pricing plan you signed up for, and get to watch movies at your leisure. If you decide it’s not for you, then you can cancel at any time within the free trial period and you won’t be charged. All you do is sign up at http://www.netflix.com.

Photo credit: Urthstripe.

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As you have probably noticed, interest rates have plummeted over the last two years. Not long ago it was easy to find saving account interest rates in the 4-5% range, and CD rates slightly higher than that. Right now the best savings accounts are offering interest rates just under 2%, which is a far cry from what many people were used to. To take the place of the high rates that were so commonplace a year ago, many banks are now offering high interest checking accounts – some with interest rates more than double or triple what the best online savings accounts offer.

High yield checking accounts

High yield checking accounts are becoming more popular in banks across the nation, particularly the smaller regional banks that are vying for more customers and larger deposits. The biggest advantage these checking accounts offer is the high yield interest, but many of them offer other advantages such as free ATM withdrawals, no fees, and automatic bill pay.

How good are the interest rates? Rates vary of course, but a bank in our local area is currently offering a high yield savings account in the 4.5% range, which is over 3 times the interest rate that ING Direct savings account offers. While this seems like it would fall under the “sounds too good to be true” test, it is true – if you meet the conditions. And the terms and conditions are the biggest downfall to these types of accounts. Let’s look at some general requirements.

Common high yield checking account requirements

Banks are able to offer these high interest rates because these accounts are profitable for them when you meet the following criteria:

• You live in the local area.
• You sign up for direct deposit or automatic bill pay (or both).
• You make a minimum of 10-12 debit card transactions per month.
• You elect to receive electronic statements instead of paper statements.
• Limit of $25,000 at highest interest rate (common limit, some banks may vary).

It’s important to meet these requirements because the bank will reduce your interest rate to the standard checking account interest rate in any month you don’t meet the requirements, usually down to 0.5% or lower. Again, this is a general representation, so be sure to read the fine print before opening an account.

Pros and cons of high yield checking accounts

Pros. A 4.5% interest rate is a stellar interest rate in this economy. Your funds will be guaranteed by the FDIC and the entire amount of your deposit, up to the limit, should be eligible for the high interest rates. Many banks also offer ATM fee reimbursements with a high yield checking account, which can save you money. (more on how to save money on ATM transactions).

Cons. Most high yield checking accounts have a long list of requirements which usually ends with a clause that states the terms can change at any time, or that they are only available to customers for a limited time. Making 10 or more debit card transactions per month can be a nuisance that many people would prefer to avoid and the $25,000 limit may also turn people off because it can be a hassle to switch your deposits from bank to bank. Finally, one slip up and you lose the higher interest rates and other benefits, potentially including the ATM fee reimbursements that you made under the impression they would be reimbursed.

How do banks make money from high yield checking accounts?

When you look at the terms and conditions you will notice a few requirements that are in the bank’s best interest – including electronic statements, automatic bill pay, direct deposit, and multiple debt card transactions. Banks spend a lot of money processing paper statements; electronic statements are a huge cost savings for them. They also spend a lot of money processing checks that are both deposited with them and are drawn against their accounts. Automatic deposit and bill pay substantially reduces the number of checks they process each year.

Banks receive a fee when you use your debit card and debit card use reduces the number of checks people write. You will also notice there is a limit on the amount of money on which they will pay the higher interest rates. That is because these accounts are only profitable up to a certain point, which is reflected in the limits.

Most importantly, the banks know how much it costs to find and retain new customers, and these deals work great to bring in new customers and create loyalty to their bank. Current customers are much more likely to use their current bank for loans, mortgages, IRAs, and other financial products that can be profitable for the banks.

Are high yield checking accounts worth it?

The answer is – it depends. From a mathematical standpoint, yes, higher interest rates are good. But the added hassles may not be worth it on a time/maintenance level. I personally haven’t opened one because I am happy with my current bank and I can’t be bothered by making a minimum of  10 debit card transactions per month and making sure I swipe the card as a credit card. I don’t have the patience to keep track of how many transactions I have made, and I don’t want to get in the habit of running to the gas station or Wal-Mart to make a series of transactions at the end of the month to ensure I continue to meet the account requirements.

On the other hand, the interest rates are very nice and I certainly understand why many people are attracted to these accounts. It’s not really that much work to maintain compliance – it’s just more than I am willing to do on a regular basis.

What are your thoughts? Do you have a high yield checking account, and is it worth it to you?

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Happy Veterans Day to all the veterans out there who served our country in the Armed Forces, and to those who supported veterans while they served – we couldn’t have done it without your support! Even though it may seem like some people only thank veterans once or twice a year on the major holidays, you should know  that your service is greatly appreciated year round!

Hopefully you can take some time today to relax and enjoy some of the Veterans Day deals and special offers that have been made available by many restaurants and businesses to thank veterans for their service.

2009 Veterans Day Discounts and Deals

There are a bunch of deals out there for veterans today – some are available nationally, and some are only available locally, so it pays to do a local search as well. For example, I was a few minutes late to work today because the car wash in between my house and office was offering free car washes for veterans. I’m glad I got there before my lunch break because I’m sure it will be crowded! I can’t list all the local deals, but I can share a few deals that should be available nationally. Feel free to add more in the comments section if you have additional information.

Nationally available Veterans Day deals:

• Golden Corral’s Free “Thank You” Dinner for Military – Monday, Nov. 16, 2009, 5 p.m. to 9 p.m. (note time and date!).
• Applebee’s Free Meal on Veterans Day – *Available during business hours on November 11, 2009 at participating Applebee’s only..
• Outback Steakhouse Veteran’s Day Deal.
• Free Admission to National Parks on Veteran’s Day.
• Lowe’s and Home Depot military discounts.
• Free Krispy Kreme for Veterans.
• More Veteran’s Day Discounts from Jarhead Online.

Be sure to check out more military discounts over at Military Finance Network for more military discounts and special offers. And thanks for your service to our great country!

Photo Credit: cliff1066™.

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If your company is one of the many companies currently going through annual open enrollment period, then you have probably read the term “eligible life events” or “qualifying life events” a couple dozen times by now. It’s important to know and understand which life events qualify, because many people only have one chance per year to elect their health benefits unless they have a qualifying life event, which gives them an opportunity to change their benefits elections.

Why do qualifying life events matter?

Most companies negotiate group health insurance costs once per year, and it’s more cost efficient for both the insurance company and the employer to keep a relatively steady number of people in the plan they elect at the beginning of the year. Insurance companies agree to lock in rates for the year in exchange for keeping people from switching plans at will. However, it wouldn’t be fair for the insurance companies not to allow people to change plans when they have a major life event that changes their needs. So there is a built in clause that allows people to change their health care coverage when they experience certain qualifying life events.

What are qualifying life events?

As mentioned above, qualifying life events are major events in your life that qualify you to change your health care coverage outside of the open enrollment period. Major life events include:

• Marriage, civil union, divorce, annulment, legal separation.
• Birth, adoption, taking in a foster child, or becoming a legal guardian.
• Change in spouse’s work status.
• Death of spouse or dependent.
• Change in status of dependent’s eligibility (e.g. change of student status or becoming too old for coverage).
• Possibly more, depending on plan.

These are common qualifying life events, so be sure to read the fine print in your benefits enrollment package. Also keep in mind that you usually only have 30 days from the date of the qualifying life event in which to make a change in your health insurance plan. Insurance companies or your Human Resources department may also require proof of the qualifying life event, so be ready to fax a copy of a birth or marriage certificate, death certificate, adoption papers, etc. Specifics vary from plan to plan, so be sure to read your plan thoroughly before electing your benefits plan.

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Open Enrollment is currently in season for thousands of employees. For most people, this is the only time of the year when they can make benefits elections for their health, dental, vision, and other company sponsored insurance plans. Most companies only give a two week window to make changes, so let’s take a look at the most common health insurance coverage options available to most employees.

Open enrollment health insurance options

There are several types of medical insurance, and we will cover the most common types – keep in mind that your company may offer variations, combinations, or something completely different than these listed here. This is general information only, and you should examine your policy options closely before making a decision on which health plan option to choose.

Fee for service health care plans

Fee for Service health care plans are the most flexible healthcare insurance plans available, as you can visit any doctor at any time, without a referral required by the insurance company. You do not need to worry about in or out of network providers and you can visit any hospital in the country. You also pay for this flexibility.

You are required to pay a health insurance deductible out of pocket before the insurance company will begin paying for any of your medical bills. Once you reach your deductible you pay coinsurance, which is when you share the health care costs with your insurance company, usually by a set percentage of the total bill. Some fee for service plans place a cap on the amount of out of pocket expenses you can incur within the course of a year. For example, in addition to your monthly premiums you may have a $500 deductible, and a $5,000 annual cap on your insurance. Be sure to read the plan thoroughly because there are often restrictions regarding which types of medical care are covered in this type of health insurance plan.

Pros and cons of fee for service health care plans:

• Pros: Freedom to choose health care provider, Cap on annual expenses.
• Cons: Restrictions on some plans, cost may be more than an HMO or PPO.

Health Maintenance Organization – HMO

With HMOs, health insurance companies negotiate fixed rates for health care with a select group of medical care specialists. Health care is limited to in-network health care providers who are a part of your HMO plan. To receive care, you are required to select a Primary Care Physician (PCP), usually a general care practitioner, who is your central point of contact for all medical care, including appointments, specialist referrals, and other medical care. You will need to visit your PCP for all medical inquiries or to get a referral to a specialist. You run the risk of paying out of pocket for using an out of network medical professional unless it is an emergency or your plan specifically gives permission. While there are limitations to HMO plans, they are often a low cost health insurance option because of the low rates the health insurance companies are able to negotiate.

Pros and cons of HMOs:

• Pros: Lower premiums and deductibles, and higher coverage rates.
• Cons: Required to select a PCP, must get specialist referrals, and are restricted to in-network health care providers.

Preferred Provider Prganization – PPO

Preferred Provider Organizations are generally a little more expensive than HMOs, but they offer more flexibility. PPOs have negotiated rates with their networks, but you are free to go out side the network for healthcare coverage, though you may have to pay more for it. Primary Care Physicians are not required and you can visit a specialist without a referral.

Pros and cons of PPOs:

• Pros: PCP is not required, referrals are not required for specialists, and out of network providers are covered.
• Cons: Premiums and deductibles are often higher than HMOs, percentage of coverage may vary.

Health Savings Accounts and High Deductible Health Insurance Plans

Health Savings Accounts (HSA) are gaining in popularity among both employers and employees – employers because they save money on group health insurance costs, and employees because they have more choice on how they use their medical coverage and they can save the money they don’t use in any given year and roll it over to the next year. HSAs are a tax-favored savings account that is combined with a high-deductible health insurance plan.

Contributions to your Health Savings Account are considered an “above the line” tax deduction and are considered a f ederal income tax deduction, regardless of whether or not you itemize your deductions. Some states also allow tax deductions for HSA contributions.

Pros and cons of HSAs and High-deductible plans:

• Pros: Low monthly payment, money grows in a tax-deferred savings account until withdrawn for health care needs. This may be a good plan for healthy individuals with few medical care needs.
• Cons: High deductibles and co-pays. limited coverage in some cases.

Other Health Savings Plans. There are several health savings plans available, including HSAs, Health Reimbursement Accounts (HRAs), and Flexible Spending Accounts (FSAs). You can read more to determine which Health Savings Plan is the best for your needs.

Terminology is important!

When comparing health insurance plans, it’s important to understand what you are getting. For example, “in-network” and “preferred providers” are often interchangeable. Co-pays are when you make a payment at the time of service, often a set rate that is clearly negotiated as part of you plan. Co-insurance is when you pay a percentage of the bill, usually in the 10-30% range. There is a HUGE difference in the meanings of co-pay and co-insurance when you are dealing with a major medical procedure!

Be sure to read your health coverage plan thoroughly, and call your Human Resources department or insurance company if you have any questions or if there is anything you are unsure of. Remember, cheap health insurance isn’t always the best health insurance. But with some research, you should be able to find affordable health insurance that meets your needs.

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