Archive for November, 2012

As the old saying goes, money makes the world go round. It may be a cliché but it does hold a lot of truth about the importance of making money. A lot of people are not knowledgeable about personal finance thus they often find themselves deep into their financial problems without seeing any light at the end of their dark tunnel. Some of them have to restructure their debts while some people file for bankruptcy. If only they are careful with their money, they wouldn’t have encountered a lot of difficulties.

At any point in your life, making money must be one of your priorities because it will pay your daily living expenses, emergencies, and other financial needs. Before you start making money, you have to examine your spending habits last month so that you’ll know how you spend your money. By knowing your expenditures, you’ll be able to decide which expenses you have to cut back in order to add to your savings. There are some banks which provide money tracking online for free and there are also money-tracking tools from various websites.

Part of your making money strategy is finding out how much money you need for retirement. As a rule of thumb, you can multiply your present annual salary by 12. You have to ensure that you save that amount of money before you retire. You have to plan how you’ll be able to raise the needed amount of money. Also, you have to check investment fees your current retirement accounts are charging you. You may opt to transfer your money to a retirement account which offers low fees as part of your making money strategy.

Another strategy in making money is to take advantage of every tax breaks made available to you. IRAs and 401(k)s provide various tax advantages. You may also ask your HRD head if there are employee benefits which you may not be fully taking advantage of. Every quarter, you also have to check your portfolio because your risk appetite may change. For those in their 30s, their financial portfolio may include 70% stocks and 30% bonds or other conservative investments. For those in their 60s, their financial portfolio may be reversed. Eventually, people will need to change their lifestyle in order to increase their rate of personal savings.

For people in their 20s and 30s, it is important to have a will as well as healthcare proxy documents and power of attorney. Part of personal finance is ensuring that each individual has a life insurance especially when there are dependents involved. Making money at this age involves increasing the rate of savings until the personal goal percentage is reached. A 20-year-old individual may opt for a 20% savings rate. Debts must be put at bay and paid on time. In case there is a huge credit card debt, a person must ensure that he is aggressive in paying the debt off as part of his making money strategy.

Personal finance for people in their 40s and 50s include analysis of the kind of support given to family members, especially to adult children and parents, because such support may have a negative impact of the person’s making money ability and financial security. It may make sense to find other ways to support the family members. For those with at least $50,000 assets, it may be best to take a long-term care insurance so that a nursing-home care or assisted living can be taken advantage of when needed.

Even individuals at least 60 years old can still have their own making money strategies. They may purchase an annuity as a way of making money even in old age. The annuity can offer additional financial security, especially for those without pensions. Making money during old age may include continuously working even in retirement. As much as possible, benefits from Social Security must be delayed in order to maximize the payments.

Deutsche Telekom AG (DTE) has considered its T-Mobile USA division to merge with Metro PCS (PCS) Communications Inc. This action will leave Sprint Nextel Corp (S) trailing behind them. Once this negotiation pushes through, Deutsche Telekom AG (DTE) will gain a dominant share of 74%. Though there was a takeover plan made by Sprint, the tie-up between T-Mobile USA and Metro PCS will make them reconsider these plans.

Though Sprint was able to get a stock gain of109%in the stock market and has topped the MSCI World Telecommunication Services Index. It is still trading with 58% discount to its sales. But the only way it can compete with those larger companies is to buy Leap Wireless (LEAP) International Inc. or merge with T-Mobile or buy some shares with T-Mobile USA.

The board of both companies has approved the transaction with Metro PCS gaining scale of$1.5 billion in cash while the combined entity will remain under the T-Mobile name. T-Mobile USA being the 4th among the largest U.S. carrier seeks to stem losses and gain in order to compete in a market presently dominated by Verizon Wireless and AT&T. These wireless giants each have over 105 million subscribers as taken from June 30 results which is 3 times that of T-Mobile USA’s 33 million. Joining with Metro PCS will add 9 million prepaid customers to T-Mobile USA making them closer to Sprint’s No. 3 slot which has 56 million subscribers

Shares of Metro PCS rushed higher with 18% after 14 months the highest after Bloomberg increasing market value to around $5M. Sprint’s was affected slumping at its steepest level in a year.

The deal Metro PCS is having will cause Sprint to play on the defensive side forcing them to seek one deal with Leap to guard its spot in the telecommunications industry.

There is a rise in the shares of Leap at 17% being the biggest improvement in 4 years, but it only finished at 8.4%. Leap has 5.9Mprepaid subscribers as recorded in the end of the second the quarter and is the logical choice for Sprint.

Purchase of Spectrum

There is another alternative for Sprint and that is in place of buying it could acquire radio waves like the spectrum from entities like Dish and Verizon Wireless in order to widen its network of coverage which is an open to all process giving any prospective buyers the chance to participate.

Though the merger of T-Mobile USA and Sprint is not a distant possibility and even though T-Mobile USA continues with the deal with Metro PCS. Sprint cannot take the chance of having T-Mobile off the table for negotiations, what it does is only increases the pricing if they were to acquisition is to be pursued.

Complications on the Deals

A deal as complicated as this can go more complex if Sprint attempts to purchase the combined entity. It will take a year for the team up of Sprint to T-Mobile even with T-Mobile getting interest in such deal because T-Mobile is now a bigger entity to take for Sprint. Another alternative is or Sprint to make a rival proposal with Metro PCS. Sprint can wave the deal and improve its operation instead through a roll out of its present network and focus on getting a return in profit which could make the company increase its chance in competing. The investors of Sprint may as well continue running the business as successfully as they are doing and it is believed that Sprint considers this as their top priority move.

Failed Deals

There are many telecommunications deals that failed to reach completion. Take for example Sprint’s deal with Metro PCS this year which was rejected by the board. Cost of such move would have been in the level of $8 billion to include debts. There was also the discussion with Deutsche Telekom on the purchase of T-Mobile USA before March of 2011 announcement of AT&T offering to acquire the company for $39 billion. At a certain point due to the U.S. regulatory scrutiny which has forced AT&T to abandon its December offer for T-Mobile USA. Such deals with Metro PCS or Leap are not sufficient in making either T-Mobile USA or Sprint a threat on its rival which are already larger.

T-Mobile and Sprint are not as big as AT&T and Verizon so it is harder to compete. For them to increase their size by as much as 25% but if the rival is twice your size even an acquisition of 25% cannot close the gap to make it at par, rather it only reduces the gap.


With the recent technological advancements, cell phones have evolved from being functional devices for voice calls to being exceptional portable computers. With the introduction of smart phones to the market, a person can send SMS, surf the internet, play video and music, and do video conferencing. With the changes brought about by technological innovation, people now spend more money on cell phone services. If you’ve been using the mobile phone for the last 10 years, it would be easy to notice the change in your budget for mobile phone services.

The Growing Mobile Phone Bills

During the early 2000, an average American typically spent $210 annually on mobile phone services. Today, the average American spends about $760 annually. According to statistics released by Bureau of Labor Statistics, mobile phone services increased by at least 15% annually for the first 10 years of the new century. Such increase is considered significant considering that during the same period the average increase in annual household expenditures was pegged at 2%.

The Effect Of Cell Phone Bills On Family Budgets

It has been noticed that mobile phone purchases have become a significant part of each household budget. A lot of people have scrimped on clothing and dining out expenses to buy new cellular phones. With such change in buying behavior, expenses related to cellular phone use have increased steadily in the family budget.

The Effect Of Cell Phone Spending On Land lines

With the increase in cellular spending, there is also a significant decrease in land line spending. Because the cell phone has met an individual’s communication needs, the land line has become insignificant. At the start of the new century, the land line bill would have taken around 75% of the total budget for telecommunication. After 10 years, an average individual was spending 65% telecommunication budget on cell phone bills.

How Africa Is Coping With The Mobile Phone Innovations

This shift in telecommunication spending is not only unique in the USA. In fact, Africa is using the mobile phone technology more than the other countries. According to Toby Shapshak of, Africans have become creative with their use of cell phones. It is the only continent around the world with a “mobile only” policy. Because most African locations don’t have reliable sources of electricity, Africans have found old cellular phones which had been junked by most countries to be beneficial primarily because this type of mobile phones have longer battery life. It is very common to see Africans using their cell phones to listen to the FM radio.

Africans also have at least 2 SIM cards because mobile networks in the continent charge higher for interconnection fees with different networks. Thus, they just interchange their SIM cards if they want to communicate with other people who are using a different mobile network than theirs. The cell phone is also used to access the internet. According to Shapshak, South Africa records 25% of its Google searches using a mobile phone during the week. On weekends, this figure rises to about 65%. The mobile phone is also being used for money transactions. According to Gartner, mobile money transactions can reach up to $171 billion before the year ends.

Solar energy is the safest source of electricity which is generated through solar cells. These cells have more advantages than any other source as it functions without air or water, there is no vibration, does not generate waste and is not harmful to anyone and even mother earth. But how come this is not totally used at present? There were many reasons that implicate the change one is because this is a costly project. However, it is still expected to take its mark in the year 2050 since with the rapid growth in population, the weakening of non-renewable sources and the tremendous effect of pollution will force the global focus to renewable projects.

Advantage: As a Low risk fuel. In comparison to fossil fuel or nuclear energy there is no price volatility as well as risk in the delivery. Though there is an expected variation in the amount of sunlight that is available as in the time of day and season still this can be configured to increase reliability ensuring a long-term and fixed pricing of electricity.

Advantage: Installation is everywhere. It can be installed anywhere as compared with other renewable energy sources such as hydroelectric and wind power. That is due to the fact that sunlight is available anywhere. Likewise it eliminates the expense of transmission and distribution. Residences can greatly benefit from this too.

Legislation Coverage: Energy companies have benefitted with the legislation that is geared towards renewable sources of electricity generation in the United States. With the Congress extension of the 30% federal investment tax credit; residential and commercial installations will gain more from this until end of 2016.

Funded programs: Many governments have increased their financial support for solar energy projects. Among them are India, U.K., Canada, Japan, China, Japan, Australia and even the Middle East.

Wealth knotted on the crude oil: The rise and fall in the stock market for crude oil price is still affecting stock prices of alternative energy.

Weak Points of Solar Energy: The solar energy industry is now facing some weak points as problems of excess solar cell supply are experienced. This is attributable to the slow demand in the market coupled with high inventory.

Stock market effect: Solar stocks of energy companies like LDK Solar, JKS and STR are affected by the aforementioned scenario.

Newly developing technologies: The possibility of certain development of low-cost sources of alternative energy could further affect the solar energy growth.


However, it should be noted that said development could still take years and now solar energy is the best option humanity can use to prevent the effects of pollution and the visible depletion of non-alternative sources of energy. What good would these other alternative energy sources are if the harm has been done and cannot be undone? The future is everyone’s concern let’s act and do our share.