How to save on luxury car rentals through travel credit cards

How to save on luxury car rentals through travel credit cards

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Your vacation can be upgraded to a fun-filled journey by upgrading your car rental to a luxury car.

Popular rewards credit cards and airline rewards programs may give you options to use points to pay for car rentals for travel. Many rental car companies also offer their car rental rewards programs for consumers.

To get the most out of your travel credit card rewards programs, it is important to know which points you may redeem as per your specific situation. It is also important that you consider the cost of insurance coverage.

Redeeming points on car rental is more difficult than redeeming on hotel costs or travel expenses. The major reason for this is that most rental car payments occur upon return of the car and are not prepaid. This is the sole reason that American Express does not provide the option to redeem reward points for car rentals.

Now we will discuss different aspects of using travel credit card reward points for car rentals.

#Earn miles and points for car rentals

Isn’t it great if you can drive a luxury car, pay the rental through travel credit card, and earn miles and points? By choosing the right travel credit card, you have the option to grab extra points to boost your affordability for getting a good hotel, airline, or flexible travel loyalty program.

Here are two options available:

a) The Hilton Honors American Express Aspire Card – Gives you 7 points per dollar on car rentals booked, on selected car rental companies,

b) CitiBusiness® / AAdvantage® Platinum Select® World Mastercard® – you may earn 2 miles per dollar on all car rental agencies.

You may choose your car rental companies from referral of your preferred airline’s websites, such as Southwest, Delta, and United airlines.

#Save on high-end car rentals

It is quite challenging to save on high-end car rentals than driving an ordinary vehicle. But before doing that, you need to follow a few tips.
Let’s get it through a simple example: Suppose you want to rent an Audi Silvercar which offers 20% off on your first rental after using a promo code available on the company’s website.
But, if you use a Visa Infinite card, which is registered with Silvercar by Audi, it can get you up to 30% discount on car rentals.
Additionally, you may use few travel cards such as Chase Sapphire Reserve or the Capital One® Venture® Rewards Credit Card. These cards may offer you credit to meet travel expenses.
You need to research a bit and then use your travel cards for booking luxury car rentals. This way you can save on luxury car rentals as well as drive your dream car.

#Choose the right insurance for car rentals

While you are driving a high-end car, you’ll want to be insured in case of an accident.
Many travel credit cards provide secondary car rental insurance. It means if you can’t insure your car, you may opt for car rental insurance and save on luxury car rentals. If anything goes wrong with your rental car, then it must be reported to your car insurance company, which can potentially raise your rates.

For example – Chase Sapphire Reserve is a unique travel card that may offer you primary car rental insurance, which pays your dues without involving your primary personal car insurance company.

Now let’s have a look at the available cards that may give you the best car rental rewards programs and other coverages.

Chase Sapphire Reserve and Chase Sapphire Preferred

In Chase Sapphire, Preferred cardholders may get 1.25 cents per point towards travel rewards. Chase offers competitive rental car rates to its consumers. Additionally, it offers greater rewards for flights or hotels.

The Chase Sapphire Reserve provides primary rental insurance. Primary insurance coverage can help you to avoid most of the out of pocket cost for car rentals.

Capital One Venture Rewards Credit Card

This card will provide you with double miles for every purchase. It offers a rate of 1 cent = 1 mile each. The card also gives you a sign-up bonus of 50,000 miles when you spend $3,000 in purchases within the first three months.

Citi Double Cash Card

You’ll get double cash rewards if you earn $25 in rewards without paying an annual fee. You can earn 1% back after making a purchase and again another 1% back after paying off the balance.

Rental Car Loyalty Programs

You may join this reward program and earn points. You have the option to combine loyalty points with rewards points from another source. This option might be the best choice for cardholders who travel for business including international business travelers.

Hertz Gold Plus

The Hertz Gold Plus program is one of the most popular car rental reward programs available. This program offers 1 point per dollar on rental and service charges, fuel, and other expenses. These rental car programs are beneficial for consumers who are looking for longer rentals. Hertz rental can program can give you the option to redeem points internationally.

Avis Preferred

Avis Preferred rental program offers one point for every $1 on rentals and two points for buying car accessories. Once you, being a member, reach the number of 12 rentals or pay $5,000, you will be upgraded to Plus status and able to get points at higher multipliers.

National Emerald Club

If you want to save on luxury car rentals, the National Emerald Club is another option for you. It provides credits towards free rentals. Emerald Club members can earn one point per rental. A free rental is available to regular members (7 credits), executive members (6 credits), and elite members (5 credits).

Enterprise Plus

The Enterprise Plus program creates the option for members to earn one point for each $1 spent. Members can get free rentals as soon as they reach 450 points or more. The best thing about this luxury car rental program is there are no blackout dates. The program has three status levels for members, Silver, Gold, or Platinum. Each category has its benefits and amazing reward options.

Southwest Airlines

Southwest airlines don’t have the option to redeem points to get a cheap luxury car rental. But they provide vouchers to get a decent rate at the prime car rental companies such as National, Alamo, Budget, Hertz, and Avis – for just 1 cent per point..

Store cards make you feel unsafe and vulnerable - Here’s how

Store cards make you feel unsafe and vulnerable – Here’s how

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Owing to lucrative rewards and benefits, store cards have gained popularity in the last few years. Store cards like Amazon Prime Rewards Visa Signature Card and the Target REDcard™ Credit Card give a flat 5% discount on eligible purchases at Amazon and Target. Plus, they offer free shipping and a long return window. Needless to say, people are happy to use these cards. However, there is one point that people are forgetting. Store credit cards have loads of drawbacks. They leave you unprotected and vulnerable to unauthorized charges. They offer minimum protections when it comes to disputing charges. Other credit cards running on a network like Mastercard or Visa give you more protection than store cards.

How store cards leave you unprotected

The Consumer Financial Protection Bureau (CFPB) receives hundreds of complaints from consumers regarding unauthorized charges. Most of them have been charged for purchases that they didn’t make or aren’t satisfied with.

A New York based teacher recently complained to the CFPB that he has been charged $7300 for a prepaid cruise, which he is completely unaware of. Again, a Florida based chef paid $2600 for installing a front door in his home. But he was not satisfied with the product. So, he wanted to get back a portion of his money. He complained that store cards didn’t provide him comprehensive coverage and faced a lot of issues in reversing a portion of the transaction.

These are only a few instances. If you explore the popular credit card forums, you’ll hear more stories from consumers. As of now, let’s find out how store cards leave your money protected.

1. Store cards offer minimum protections for billing errors

As per the 1974 Fair Card Billing Act, store card issuers have to follow the proper dispute procedure when consumers aren’t happy with a product or service. They are also required to look into billing errors. But the requirements are not stringent and comprehensive.

Normal Visa or Mastercards give additional protections to consumers, which makes it easier to dispute charges. They provide extensive coverage to consumers to contest fraudulent charges.

2. Store cards have geographical limitations

Most store cards like The Home Depot Consumer Credit Card and My Best Buy Credit card come with geographical limitations. For instance, the terms and conditions of a closed-loop card issued by Comenity Bank clearly state that consumers can get back their money under the following circumstances:

  1. Consumers aren’t happy with the quality of goods or services
  2. Consumers have already complained about the product to the retailer
  3. Consumers have purchased the product in their home state or within 100 miles of their present mailing address

This has become a major problem for the consumers especially after the emergence of e-commerce websites where they can buy products 3000 miles away from their home.

Normal credit cards like American Express, Visa card, and Mastercard allow consumers to contest charges irrespective of the geographical location of the place from where a product was purchased.

3. Store cards have high APRs

Most store cards charge higher-than-average APRs, which implies that consumers have to pay more when they carry a balance. They have to pay more in interest. Some store cards even have a deferred interest feature where interest accrues in the background. If consumers can’t pay off the entire balance before the deferred interest offer ends, they will be charged interest on the purchase price, retroactive to the date they bought it.

How credit cards give you more protection than store cards

Store cards Credit cards
You have fewer options to get your money back. You have various options to reverse a transaction.
There are geographical limitations in the case of store cards. There are no geographical locations in the case of credit cards.
Closed-loop store cards offer minimum protections for disputing charges. Mastercards and Visa cards offer additional protections and coverage for contesting charges.
Store cards offer deferred interest feature where interest accrues in the background. They give a 0% introductory APR offer where consumers can save money on interest for 12-18 months.

4 Steps to safeguard yourself when you’re using store cards

There is no doubt that store cards offer big discounts on purchases. But they have a few drawbacks also. So if you still want to use a store card, then here are a few steps you can take to safeguard yourself.

  1. Read the terms and conditions of a store card before accepting it. Find out how to dispute unauthorized charges and when rewards will expire.
  2. Contact the retailer directly when a product is not delivered or you’re not happy with the item. Ask him to solve the problem first and then contact the store card issuer.
  3. Review your monthly bills and statements every month to find out if there is an unauthorized charge. It can help you to dispute charges within the specified time limits of the store cards.
  4. Save all the receipts. You’ll need them at the time of disputing the charges.

Final notes

File a complaint with the CFPB if you’re not satisfied with how a store card issuer has addressed your problem. You can also report the matter to your State’s Attorney General.

Why do you think that your child should have a credit card?

Why do you think that your child should have a credit card?

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The perfect age to get your child a credit card may depend on a few reasons. He or she may have to be prepared to manage the card properly. Also, you must find out which credit card to obtain so that you can benefit most from the arrangement.

Why it’s wise to get your kid a credit card before he/she becomes 18

Here are the reasons why you might want to get your child a credit card before he/she turns 18:

1. Building credit

Presently, most of the parents might want to help their kids to get a credit card. It is only because they want to help their kids to build credit on their own responsibly.
If you are following FICO credit score, then you must also know that FICO considers 5 factors to calculate a credit score. They are as follows:

  • Payment history
  • Credit utilization
  • Length of credit history
  • New credit
  • Credit mix

A decent length of credit history will help your kid to build good credit. So, if you’re going to help your kids to build credit, you’ll also have to teach them good spending habits.

2. Teaching healthy habits

As I was saying earlier, to get your child the first credit card, you should concentrate on teaching your kids good habits and healthy thinking towards money. It will make your kids responsible enough to manage their credit cards. A majority of people, who find themselves into knee-deep debt, may carry a bad spending habit from the very beginning of their lives. As a parent, work with your kids and differentiate between what you really need and what you want! Once they know the difference and learn how much it can cost them, it will go a long way toward keeping them out of financial trouble.

3. Controlling impulse buying

By analyzing your kid’s monthly purchases and other expenses, you can help your kids to have an insight that they are spending more (if they are doing so) than they can afford. So, you should teach your kids about avoiding two things that can hurt their credit score the most. The first one is keeping high balances and the second one is making late payments.

4. Providing a safety net

Good credit habits are behaviors we wish our kids will start following on their own. But practically, as they grow older, they would make mistakes and gradually learn from it. Unfortunately, each “learning opportunity” stays on a credit report for seven years. Thus, the last reason to get your child the first credit card while they are still under your financial roof is for you to be able to provide a safety net. By keeping an eye on their card statement, you can be sure that they aren’t wasting their money on silly things, or getting into a trap of monthly charges. You may also secure them from the identity thieves if you keep a proper watch.

5. They can use it in an emergency

If you can give your kid a cell phone so they can call you in case of an emergency, why don’t you give them a credit card for the same reason?
It’s unlikely that your son or daughter will need to use the credit card often for emergencies. But it might give you some peace of mind that they won’t get into any trouble if they run out of gas or forget to carry cash while traveling.
It is a good idea to put rules on using the card, though, so you both agree on what qualifies as an emergency expense. You should teach your kid the value of an emergency fund. You may also teach them to pay off any sudden credit card expenses that arise. This way kids can get the entire credit limit intact to use in emergencies. So, do not waste your time for getting your child a credit card.

Which credit card providers issue credit cards for children under 18?

Adding your child as an authorized user can be a wise choice. But you may face several issues if your credit card provider doesn’t allow it or has an age requirement.
To get your child a credit card, you should determine how the top credit card issuers set up the age criteria.

Credit card consumer Age requirement
U.S. Bank 16 years
Discover 15 years
Barclays 13 years old
American Express 13 or 15 years old
Wells Fargo No minimum age requirement
Bank of America No minimum age requirement
Chase No minimum age requirement
Capital One No minimum age requirement
Citi No minimum age requirement

If your credit card provider do not belong to this list, call the number on the back of your card and ask them about their age requirement.

If you find that your credit card provider won’t allow you to get your child a credit card as an authorized user, or has a strict minimum age requirement, you may definitely apply for a new credit card from a different provider.

How to live frugally when you have become a senior citizen

How to live frugally when you have become a senior citizen

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Just because you have retired recently, it doesn’t mean that you can’t live on your own terms. In fact, this is the golden period of your life, and you should enjoy it thoroughly. There is no tight work schedule or deadlines. You can spend quality time with your family, do the things you love, explore your hobbies, and enjoy your retirement.

All you need to do is, embrace a frugal lifestyle to do everything you want with less financial worries. When you’re retired, your financial resources are limited. If you don’t manage them properly, then you can run out of money faster than you have expected. Hence, you should always try to be a frugal senior and lead a frugal retirement life.

In this post, we will cover a few effective frugal living tips for seniors to make life less stressful.

4 Frugal living tips for seniors – Save money and reduce stress

Here are a few frugal living tips that seniors can use to save dollars and reduce financial stress.

1. Discontinue insurance policies:

Just because you’re a senior citizen, it doesn’t mean that you need to have all the available insurance policies. Some insurance policies like auto insurance, homeowner’s insurance, renters insurance are a must. However, there are a few insurance policies you can easily discard. For instance, disability insurance if you’re not working anymore.

If you don’t have any debt and you’re not dependent on anyone, then consider dropping life insurance policy. Analyze your insurance coverage and think of the policies that you don’t require anymore.

2. Take advantage of senior discounts:

Take advantage of senior discounts offered by Walmart to save money on grocery shopping. Some Walmart stores at specific locations offer discounts to seniors on specific days of the week. Some stores offer as much as 10% discounts to seniors. So try to shop on the senior discount day at Walmart.

Make sure you check out the senior discount age criterion before shopping at Walmart so that you don’t miss out the golden opportunity to save money.

Apart from the Walmart senior discount, there are some other grocery stores where you can get lucrative discounts, and they are:

Gristedes Supermarket – Senior discounts (10% off on the total bill) are offered on every Tuesday.

Kroger – Senior discount is available on the first Wednesday of every month. You can expect to get around 10% off on your purchases.

Albertsons – You can get discounts on the first Wednesday of any month.

Shoprite – You can get a 5% to 10% senior discount on either Tuesday or Wednesday.

Harris Teeter – You can get up to 5% off on your purchases every Thursday.

Apart from the ‘shoppers senior day’ offers, you can get senior discounts on auto insurance also. If you take a senior safe driving course, then you can expect to get a $20 discount on insurance premium. AAA and AARP offer this driving course online. So it isn’t that you would have to go to a classroom for completing this course.

3. Eat and travel at the off-peak time:

You can save tons of money on airfare, food, airfare, and hotels during the off-peak hours. Many hotels offer special discounts to tourists at an off-peak time. Many restaurants cut down rates just before the lunch hour and dinner hour. So try to reach the restaurant just before the dinner hour. It will not only help you to save time but also it will help you to save money.

4. Save on your property tax:

Believe me, you can keep your property tax at the current rate and stop it from going up. All you need to do is check if this benefit is available in your state and then submit an application form. Open the state’s tax department and check out the eligibility criteria. If you meet the criteria, then apply immediately.

Conclusion

The aforementioned thrifty living tips can help you save money and lead a comfortable life after retirement. Apart from that, you can explore frugal retirement forums to know how to lead an independent financial life without any debt.

borrowing-from-the-401k-plan-to-pay-off-debts

Borrowing from the 401(k) plan to pay off debts: Is it worthy?

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401(K) is an employer-sponsored retirement plan that allows employees to save money for their retirement days in a tax-deferred manner. However, when the employee will retire and withdraw the money from the 401(K) plan, he/she needs to pay the tax on it.

How does 401(k) plan work?

401(k) plan is managed by the employers. They decide the type of 401(k) workers can use and, what investments workers can select for their plan. The employers also decide that what investment management firm will run the investment part of the 401(k) plan.

The employee has to sign up for the 401(K) plan usually from the first day of the job.

What are the benefits of contributing money into a 401(k) plan?

Employees can decide how much of their paycheck should be contributed into the 401(k) plan depending on the IRS contribution limit.

They can also select investment vehicles while opening a 401(K) plan. Rest will be taken care of by the employer (Plan sponsor).

One more benefit of contributing money into a 401(K) plan is that it allows the users to take out a loan against their savings. The users can get relatively low-interest rate loan that they can use to consolidate their debts.

So, it is clear that the 401(k) plan is one of the great ways to build wealth for your retirement days.

But, today’s topic is not discussing about the benefit of a 401 (K) plan in detail. Today’s topic is, should you take advantage of your 401(k) account to consolidate your debts?

Should you use a 401(K) loan to pay off your debts?

The answer cannot be said in one sentence. So, read the article to know the answer.

As per the financial experts, taking out a 401(k) loan to pay off the debts should be your last resort. When you have other debt repayment option to get out of debt, then you shouldn’t borrow from your 401(k).

On the other hand, some financial experts say that borrowing money from a 401(k) plan is a less expensive option to repay the debts. If you’re drowning in multiple debts, then you can take advantage of a 401(K) plan.

Why you shouldn’t borrow from your 401(k) plan to pay off your debts

Though a large number of 401(K) users are taking advantage of their plan to get out of debts, the idea of borrowing money from the retirement plan is not good.

Here’s why you shouldn’t borrow from your 401(k) plan:

#You can’t save enough for your retirement

Remember, the major goal of having a 401(K) plan is saving enough money for the time when you will not work anymore. In most of 401(k) plans, there is a provision that prohibits the user from making additional contribution until the loan balance is repaid by you.

#You are not making the profit

If you stop contributing money since you have an outstanding loan, the money is not growing. Also, you will miss the potential growth in the stock markets. The low interest that you are paying to yourself is very inadequate than the ROI that you can get from the market by contributing money thoroughly.

If you borrow a loan from it, then you should double your contribution to make most of it.

#You are losing time to grow your money

The more time you will give in a long-term investment like 401(K), the more wealth will build with time. As per the financial expert’s calculation, the money in 401(K) usually becomes double on average in every 8 years.

But if you take out a loan from the 401(K) plan, then you are losing the time to make up the lost contribution. Because you are repaying the loan for a long period (Usually 5 years). Therefore, you are losing the growth opportunities.

#You may have to pay a withdrawal penalty

If you are below 59 years, then you will be charged an early withdrawal penalty. Also, if you don’t repay the loan, you have to pay the tax on the outstanding balance. So, you could lose more money on your withdrawal.

#You can never retire

If the user is unable to repay the loan after 60 days of the retirement, it will become fully taxable. Also, the user has to pay the 10% early withdrawal penalty. So, if you have a loan, you can’t quit your job without repaying the loan.

Why you should borrow from your 401(k) plan to pay off your debts

You can’t predict your financial life. You can face a financial challenge at any point in your life. And, you may have to take out a loan from your 401(K) plan.

Though you shouldn’t miss the opportunity to build wealth by taking out a loan from your retirement plan, here’s why you should borrow from your 401(k) plan.

Taking out a loan from 401(k) plan to consolidate debts is beneficial because the debtor can get the loan with relatively lower interest rate than the other commercial loans.

When the debtors repay the loan, they are paying back to themselves the money with the interest instead of paying back to a financial institution or bank.

You can repay the loan from your paycheck. You can make the repayment automatic by setting an automated system. So, no chance to miss the repayment on the new loan that you have borrowed from your 401(k) plan.

Usually, commercial loans have a higher interest rate and it takes a longer time to repay the loan. But the 401(K) plan has maximum 5 years term to repay the loan. So, you are repaying the total balance sooner.

If you borrow a loan from your 401(k) plan, it will not be reported to any credit bureaus. So, your credit score will not get any negative effect from it.

Lastly, you shouldn’t invite financial difficulties by taking out a loan from your 401(K) plan when you are about to retire. It will not let you take full advantage of this plan. So, instead of making your retirement days insecure, you should find out other ways to pay off your debts.

have-a-fluctuating-income-here-is-how-you-can-pay-off-credit-card-debt

How to pay off credit card debt on a variable income?

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It is difficult, no doubt, to manage personal finances when you are having a variable income.
Or, in other words, if you don’t have a steady paycheck on a timely basis.

Then, things get even worse, when you have racked up some big consumer debts like credit cards, personal loans, and all.

What to do then! Does it mean that people, who don’t have a steady income, should not use credit cards?!

Definitely not!

That’s why we have come up with this unique blog post for you, that will precisely help you deal with credit card debt when your income is not fixed.

So, let’s carry on with the guide, and point out some very basic ideas to straighten up your credit card payments!

Take a year’s example to understand your net annual income:

This I believe you are already doing it. If not, then you better do it, before things start falling apart.

You can be freelancing, have your own startup, or might be into some business. But, you should have a rough idea on what your annual income is.

Go back 2 to 3 years, and see how much you earned annually. Some few hundred dollars difference is not a problem, but a gap of some thousand dollars mean you need to reinvent your business strategies a bit.

You need to make sure that each year, your net income should fall within a fixed margin. The target got to be pretty clear, that by the end of each year, you are bringing in roughly the same amount of money.
That’s your call, and it depends on you, how you will do that!

Understand the credit cards you have and the payments they require:

Credit card debts are like damsels in distress that require special attention. The more you ignore them, more will they swell with anger, that is grow red on interests!

But, your income is not stable. A big reminder for you, every time you look at the bills.

Now, the best thing you can do is getting an overall idea, that how much percentage do the credit card payments demand, of your total annual income.

If it comes around 1/3rd of your net income, then you seriously need to regulate your spending behavior!
A credit card payment that makes up more than 30% of your income is not at all a good sign.

But whatever! You got to deal with the situation. And this brings us to our next most vital step.

Keep aside the same percentage of money each month, for credit card payments:

If your credit card debt requires 25% of your annual income, to be paid off in full within one year, then here’s what you need to do.

Each month, no matter whatever you earn, you keep aside 25% of it, for your debt.

Now, if you earn $1, then separate 25 cents for the credit cards. Sounds funny?? Well, that’s what you exactly got to do, my friend!

It’s like a lot easier, if you understand this simple math:

Let, your incomes for twelve months be, X1, X2, X3, X4, X4, X5, X6, X7,……. X12!

Now, (X1+X2+X3…… +X12)= Total annual income (A).

So, if 25% of (A), is all your credit cards want, then give it to them.

That will be,
25% of (X1+X2+X3…… +X12) = 25% of (A).
And, that means,
[(25%of X1) + (25%of X2) + (25%of X3) + (25%of X4) +………+ (25%of X12)] = 25% of (A).

Thus, irrespective of your salary, per month, you deduct the same percentage for credit card payments.

But, the only thing you really need to take care of is that, your predicted annual income, the year you are doing the calculation for, should not ditch you!

Give credit card debt consolidation a big-time thought:

Be it you have a fixed income or variable income, debt consolidation is the master plan you can always take shelter of.

Highly effective when you are dealing with unsecured debts, especially credit cards.

If you think that your monthly payments are really high, and if only you could extend the course of payments, by lowering your monthly amounts, then debt consolidation is what you are really talking about.

This unique debt relief process works out best when you enroll in a debt consolidation program  with a consolidation company. They will talk to your creditor, and try to make some shiftings and arrangement to your credit card payments, based on your affordability.

Once the deal is successful, you will have to just pay the consolidation company, some minimized amount each month, which in return the company will disburse among your creditors, as per the agreement they made.

Debt consolidation will surely lower the payment burden quite significantly. So, be wise and talk to a consolidation company as fast as you can.

Once the monthly payments get lowered, you won’t have much problem paying off the credit card debt on variable income.

The final step to take, is always increase your income, and get a steady cash inflow:

Big investors, well-off businessmen, and good entrepreneurs, all have debts around them. But, rarely you will find them so freaked out about their debts.

The hidden truth is, even if they are self-employed, they still try to maintain a steady income.

On the other hand, however, if your income is season based, like woolen products or commodities and all, then try to expand your products range.

Now, we can’t discuss over here how to expand your business! I believe I have done my part.

Best of luck, and do follow the tips I gave you throughout the post. If required go through this post again and again, in order to understand the simple maths, I explained.