Finding Fraud: How to Spot Insurance Scams

Deciding when or where you’re going to invest in insurance is a very important decision in life.
It is a tremendous financial turning point where you’re making decisions in entrusting your hard-earned savings through insurance providers that can accommodate your needs. This type of decision is especially difficult to make when struggles such as old age, sickness, or injuries are more likely to occur. Financially investing in life insurance providers is important as you can only do so much in preparing for the future since diseases or accidents can never really be forecasted.

Unfortunately, life insurance as a business entails opportunities for some delinquents who commit insurance fraud. According to,

Insurance fraud from the issuer (seller) includes selling policies from non-existent companies, failing to submit premiums and churning policies to create more commissions. Buyer fraud includes exaggerated claims, falsified medical history, post-dated policies, viatical fraud, faked death or kidnapping, murder and much more.”

The specifics of life insurance investments are also complex. With many providers such as State Farm Group, facilitating for different plans for definite needs ranges from handling insurance on cancers, obesity, mental health and even issues on divorce. Such complexities can come by, especially when scammers begin to set their sights on a big fish.

Types of Fraud

Insurance fraud comes in two main categories: seller fraud and buyer fraud. Seller fraud occurs when the seller of a policy hijacks the usual process in a way that maximizes his or her profit. Buyer Fraud occurs when the buyer bends the process to obtain more coverage, or claim more cash, than he or she is rightly entitled to.

Investopedia added, “Insurance fraud is basically an attempt to exploit an insurance contract. Insurance is meant to protect against risks. It isn’t meant to be a tool to enrich the insured. Although insurance fraud by the policy issuer still occurs, the majority of cases have to do with the policyholder attempting to receive more money by exaggerating a claim. More sensational instances such as faking one’s own death or killing someone for the insurance money are comparatively rare.

With a lot of factors and guidelines to consider, you may never be completely safe from different insurance fraud (and any financial investment fraud for that matter!). Here are some early warning signs to help you spot a potential fraud:

Types of Seller Fraud

Seller Fraud involves those deals that providers make which exploits policy contracts, benefiting the seller while mainly harming the buyer. There are many variations of seller fraud, but they all center on these four basic types:

Ghost Companies

Ghost companies or ghost brokers are fraudsters who sell apparently cheap insurance deals but issue policies that aren’t worth the paper they’re written on. In this scenario, policies are issued and premiums accepted from policyholders, but the company underwriting the policy isn’t legitimate and often doesn’t exist.

Put simply, ghost companies operate in two ways:

1.) Policies are bought from legitimate insurance companies using false information and then doctored before being sold to the unsuspecting client.

2.) Fake policy documents designed to look like they have been issued by legitimate insurance companies are created and sold to customers.

These downright illegal scams can easily be considered a type of boiler room operation, where a team of high-pressure scam artists dial likely victims to sell them false policies. The problem with this is (and unfortunate as it could get) that the fraud isn’t usually discovered until someone tries to file a claim on the policy that their family member thought was in effect.

Premium Theft

Premium theft is when the insurance representative takes the premium for a policy, but doesn’t use for its intended use, rendering the expected policy to be invalid. In essence, the agent simply takes the money for himself or herself.

Fortunately for most people, premium theft has become less of an issue as more companies have moved towards direct deposit models. Then again, premium theft is still possible in some cases especially when a deal provides for suspicious and highly-broken down payment policies.


Churning basically refers to a situation where the insurance representative strongly advises the customer to either cancel, renew and/or open new policies in a way that is beneficial to him or her, instead of beneficial to the client.

This type of insurance fraud often targets customers who are easily driven by the agent’s passion. As such, the agent gets a client to sign up for more policies, thus more premium. In turn, the fraudster gets larger commissions.

According to Money & Career, “For conservative, long-term investors, it is considered general wisdom that buy and hold strategies are the best way to go. So, if you are receiving confirmations once or twice a week, or 10 or more times per month, this may be a warning sign that your broker is excessively trading your account.”

Over or Under Coverage

Similar to churning, over- or under-coverage scams happen when an insurance representative tries to convince customers to buy coverage they don’t need, or sells a lesser policy and represents it as a complete policy.

This type of fraud can easily happen in other business, and the best thing about it (for the scammers) is that it doesn’t look like a scam. However, you should understand that the insurance rep is essentially trying to maximize his commissions, as well as to ensure the sale rather than focusing on meeting the client’s needs.

Types of Buyer Fraud

Much like Seller Fraud, Buyer Fraud also comes in a number of ways, but the overall theme is buyer dishonesty, “allowing” the fraudster to prematurely the supposed benefits from the policy:


Post-Dated Life Insurance

Post-dated life insurance is a type of insurance fraud wherein a policy was created after supposedly insured’s death. The fraudster makes it as if the policy has been in effect well before the passing of the documented insured, thus, resulting to claim from the company.

This kind of scam is often carried out by delinquents with the help of a charismatic insurance agent. Since record-keeping nowadays have been more rigorous than before, post-dated life insurance fraud is fortunately easier to detect.

False Medical History

This one is by the textbook. Falsifying medical history is one of the most common types and essentially the easiest type of insurance fraud. By omitting tiny details, such as a medical condition or a smoking habit, the buyer hopes to get the insurance policy at a cheaper deal than he or she would have gotten otherwise.

Lack of Insurable Interest

Some people are willing to do passively but chaotically dark deeds just to make a better deal. It is true that there are buyers who insure people they shouldn’t be insuring, in hopes that they will die. This constitutes fraud.

Faking Death or Disability

Many life insurance policies have riders for disability, and this is a good opportunity for scammers to prematurely get the payout. However, some people take it a step further and fake their own deaths! In both cases, the fraudster has to deal with the possibility of being discovered through an investigation.

As the old saying goes, insurance is a business that is built on risk analysis and probabilities. This makes every instance of insurance fraud very detrimental to the enterprise, whether it is from the seller or the buyer. For this reason, companies are forced to build contingency funds to protect them against fraud and any other unforeseen events.

While security is good from the client investor’s perspective, personal life insurance premiums tend to be higher. At the end of the day, it all boils down to both parties being honest as well as both parties being vigilant in spotting dishonest activities.


3 Financial Tips for Business Starters

Starting up a new business presents a variety of challenges that not only extends to the physical and mental side of things but also to the financial facet of the professional endeavor. Business planning and market studies involve intricate methods that need a lot of mental fortitude. The truth is that establishing a start-up business requires ample amount of time and actual physical presence for any involved business owner in order to check if everything is going as planned.


The bottom line is that one of the most important factors to check is whether the business’ finances actually balance out. Simply put, money and financial management eventually become the deciding factor if starting a business is feasible in the first place.

Start-up business owners and aspirants alike are having a hard time finding out solutions to the challenges of these hard economic times. This is the main reason why anyone who’s aspiring to be a success in the field of business should look to inform themselves about some important financial tips that can actually make a difference in their work. In this regard, these financial tips and tricks that for startup business owners can help guide the any entrepreneur find their footing in the business world:

Financial Management Starts Personally

One thing that stands out as a part of the basics for any successful business is that a business should minimize expenditures and maximize profits. Business owners do the best that they can to cut luxurious services or even redundant equipment in their establishments, while still producing at the optimum level.

Then again, being money-smart is not a one-time thing if a person really wants to be a significant player in the market. It should be part of a consistent attitude that roots from culturing one’s self to be financially wise. Thus, financial management starts personally.

Financial advisers would always tell their clients that there are a variety of ways on how to handle their finances. It should take into account both the present and future of one’s money management.


This is where saving comes in. Saving is an important facet in everyone’s financial status. This is highly critical especially when financial problems arise or the business may not be going too well. In fact, these unfortunate circumstances serve as the perfect moment when saved money presents its best benefit.

An alternative method of saving is investing. Investing is an integral for any individual, especially for those who wants to make it big in the long run. As such, investing early is much more preferred since money does require time to grow.

But where does one invest?

Banking is the most common used approach for saving money, and is in fact a form of investing in itself. Over time, money saved in a bank account can accumulate interest. Similarly, investing money in the stocks market can also be an option for those who want to involve themselves in trading.

While everything mentioned above tackled gains, financial management also puts a highlight on considering future events like retirement. Being able to get an individual insured is one of the better things when it comes to finances. Getting an insurance policy which entitles a person financial protection or reimbursement against losses is imperative for a money-smart individual.

Taking this into consideration, insurance serves as an individual’s protection from the risks of financial losses, damages or liability from damages caused by a third party. Insurance companies can vary in wide arrays, but the most significantly popular ones involve health and protection. The truth is that rigorous medical examinations are involved in getting the actual policy, but smarter people opt to take advantage of no exam life insurance which is much simpler.

Whatever form of investment one opts to go for, at the end of the day, using money to earn more money is a good set-up for any business.

Breakeven is not Necessarily Bad

The ultimate goal of any business is to gain profits consistently. However, before any real gain happens in a business, the inevitability of losses should also be considered since business may not be flourishing every time.

Losses are particularly hard to take especially for starting businesses, since it might bring about professional discouragement. While there are various possibilities in business, there comes a point when everything just ends up leveling to zero –no gains, no losses. Simply put, breakeven.

The bigger question now presents itself – is breakeven bad? The answer is not necessarily so. The actual decision whether it is good or bad comes from the circumstance it is in. If breakeven points come at a time when the business incurred losses from the months before, then it might be a good thing. If a business is consistently breaking even from the start, then it may be time to rethink about the business model of one’s establishment. Breakeven is studied deeper in economics. This is called break-even analysis.


Break-even analysis is used to determine the point at which revenue received equals the costs associated with receiving the revenue. Break-even analysis calculates what is known as a margin of safety, the amount that revenues exceed the break-even point. This is the amount that revenues can fall while still staying above the break-even point.

Break-even analysis is a supply-side analysis; it only analyzes the costs of the sales. It does not analyze how demand may be affected at different price levels. The break-even point is the point at which gains equal losses. Reaching the break-even point is a business’s first step toward profitability.

Good Profits with Better Business Partners

Establishing a new business is not always a one-man team. Often times, it comes as a result of collaboration from business partners with the same goal: to gain higher profit. Business partnering is not new. However, as today’s business world becomes more uncertain and more volatile, the imperative for business partnering is greater than ever.

The Chartered Institute of Management Accountants (CIMA) defines business partnering as a finance professional who works alongside other business areas, supporting and advising their strategic and operational decision-making through insights that drive better business. The speed and quality of decision-making is becoming increasingly essential to a business’ success, and may actually be that competitive edge they need. New research with senior executives from around the world identified a common need for faster, better decision-making processes.


Real business value is created through knowledge, intellectual property, collaboration and partnerships throughout the company. Now, more than ever, financial leadership has an opportunity to contribute tangibly to the success and future of the business. However, they can only do this successfully if they are effective business partners, which require a special set of both technical and behavioral skills: an understanding of the business and what is actually driving the numbers, as well as good people and leadership skills.

Before anything else, getting a good business partner should be done carefully and with proper thinking. Because partners join forces for a variety of reasons and expectations, sometimes, the strengths of each individual may be overlooked. The most obvious strengths are evidently recognized; however, underlying strengths, when effectively brought out, can often make a big difference in long term motivation, commitment and success.

Each person in the partnership has his own reasons for being in the business endeavor. Sometimes, people seek a partner for capital, expertise, and even connections. These are not always expressed, yet they remain as an underlying expectation. If the expectation isn’t met, the relationship can become strained.

Because each person’s expertise, motivation and personality are different, it’s important to have this discussion before anything is committed contractually.

Penny Power – How to Save Money without Pain

Saving money shouldn’t be too painful a task for you. You don’t need to be hungry, nor be that stingy friend who wouldn’t come to concerts or basketball games because you’re trying too hard to save every penny. The following are painless ways for you to save money that can lead you to your much deserved financial freedom.

Track your money

It’s usually in doing the little things that you can start to save up bigger and bigger as the days go by. There could be parts of your expenses that you may have overspent on, and you still would’ve enjoyed your life without it. The best way to know this, though, is by keeping track of your money.


Tracking your spending also forces you to look at your financial reality, and that’s not a bad thing. If you ask anyone older than you if they regret not getting a handle on their finances sooner, most would say yes. Take advantage of your younger years – start tracking your spending now to have more security and freedom later. Your future self might thank you.

The truth is that you have a finite amount of money to allocate to certain categories, as they are usually based on what you earn. Laying out your expenses compels you to prioritize where you want your money to go. Mindlessly spending on things isn’t going to get you where you need to go. You need a plan, and tracking your spending is one way to create that plan. If you want to accelerate saving or paying down debt, having a clear picture of your finances can also help you determine how you can accomplish both all at the same time.

Improve your credit score

A good credit score can save you thousands of dollars in interest on everything – from a home loan to a car loan, and from school loans to credit cards. When you apply for a credit card, mortgage or even a phone hook up, your credit rating is checked. Credit reporting makes it possible for stores to accept checks, for banks to issue credit or debit cards, and for corporations to manage their operations. Depending on your credit score, lenders can determine what risk you pose to them.


According to financial theories, increased credit risk means that a risk premium must be added to the price at which money is borrowed. Basically, if you have a poor credit score, lenders may not shun you (unless it is utterly awful); instead, they would lend you money at a higher rate than the one paid by someone with a better credit score.

If you’ve never focused on your credit score before, the place to start is to get your free FICO score online. Once you know where you stand, you can begin to improve your score and lower your interest payments.

Refinance your mortgage

The results of improving your credit score can also affect other aspects of your finances, like with your mortgage. Some people opt for refinancing to get a new mortgage to replace their original mortgage, which ultimately aids in the improvement of their credit score.


Refinancing is done to allow a borrower to obtain a better interest term and rate. The first loan is paid off, allowing the second loan to be created, instead of simply making a new mortgage and throwing out the original mortgage. For borrowers with a perfect credit history, refinancing can be a good way to convert a variable loan rate to a fixed, and obtain a lower interest rate. Then again, for borrowers with less than perfect, or even bad credit, or too much debt, refinancing can be risky.

One of the main advantages of refinancing, regardless of equity, is reducing an interest rate. Often, as people work through their careers and continue to make more money they are able to pay all their bills on time thus increase their credit score. With this increase in credit comes the ability to procure loans at lower rates, and therefore, many people refinance their mortgage aiming to get better rate. A lower interest rate can have a profound effect on monthly payments, potentially saving you hundreds of dollars a year.

If you can reduce your interest rate by one percent or more, it is often beneficial to refinance. By doing so while making payments on a mortgage, people are able to take out substantial home equity lines of credit as the difference between the appraised value of their home increases, and the balance owed on a mortgage decreases. This is particularly true for those with high rates due to less than stellar credit scores. If your score has improved, you may qualify for a better rate.

Start Cooking!

Another big source of spending splurge usually comes off of eating out in fancy restaurants, or trying to get by lunch through fast food. The thing is, no matter the situation, eating out is always more expensive than cooking for yourself. Plus, cooking your own food allows you to keep track of the nutrition (or lack thereof) of the food that you take in.


They say that the key to saving money with meals is to look for healthy foods that are versatile and nutritious. The long list includes: peanut butter, oatmeal, canned beans, garbanzo beans, lentils, eggs, almonds, apples, bananas, grapes, fresh or frozen spinach, carrots, kale, canned tomatoes, chicken breasts, broccoli, onions, garlic, brown rice, potatoes, sweet potatoes, nuts, tofu, and milk (almond, soy, rice or cow’s). Thankfully for you and for the rest of the world, many online guides are showing this trend of making cheap and easy meals under $5.

By the end of the day, you would find out that you won’t need to spend so much money just to eat good food.

Take the cheaper or the more valuable options all the time

Look at your constant expenses and see if you can lower their costs. For example, try looking at your internet connection and how much you really need: if you won’t need so much data allowance or so much speed, you can lower your monthly costs to an internet connection that would cater to your needs.

You can also consider getting rid of your home telephone. This is a great way to save money. Many don’t do it because of the 911 service, and that’s understandable. Other than that, with today’s technology, more often than not, there’s no reason to keep a landline. If you do, consider reducing your service to the minimum, and only use the phone in an emergency.


Also, if you can choose appliances labelled as “energy-saver,” look long term and calculate if you can save more money if you replace your current appliances. Try to replace incandescent bulbs with compact fluorescent light (CFLs) bulbs. These bulbs use 75% less energy and last 10 times longer. They do take some getting used to, and they won’t work in every light fixture. However, using them where it makes sense can save energy and money.

Furthermore, do look at your variable expenses, especially your leisure ones. Even buying concert tickets or flight tickets can be lowered significantly if you know how to. For example, look for tips to save on tickets for the Clippers games online, and you would learn that you won’t actually need to spend hundreds of dollars if you just find the right timing to purchase one.

There’s so many ways that you can get the most value out of your money, you just need to know where to look for them.

The Financial Benefits of Online Learning

Students around the world are continuously seeking alternatives for traditional education, especially now that high tuition fees, shortage in terms of course availability and institutionalized budget cuts, among many other challenges, have been on the rise. The most famous and effective alternative for the past four years, however, has been online learning. As world-wide technology improves, the viability of full-time online learning has become more established month after month.


With more than three million students currently enrolled in fully online degree programs, and six million others who are taking at least one online course as part of their degree program, online education has clearly become one of the most popular higher education alternatives. The continually improving reputation of online learning has also helped fuel its expansion, as initial skepticism has faltered in the face of overwhelming evidence that shows how online learning can be just as effective as face-to-face education.

The benefits of enrolling in online courses and programs span not only from the elimination of traveling; it also involves the availability of more programs and courses, higher levels of academic productivity, and significantly lower financial requirements imposed on students. Below are eight benefits of enrolling in online courses that can make anyone consider taking up this alternative learning method:

Variety of programs and courses

Before, online courses have been limited to arts and creative writing, such as Multimedia Studies, Multimedia Arts, Literature and other arts disciplines. Nowadays, the plethora of available programs and courses has grown exponentially. Furthermore, because of the viability of online courses, the availability of these programs has increased – now, anyone can be enlisted in their choice of university/college with their preferred course without the fear of classes being “full”.

From traditional four-year-university programs to completely online vocational workshops, higher education today offers a variety of options for students. This means that no matter what students wish to study, from Nursing and Neuroscience to Education and Environmental Science, they can find the courses or degree programs they need online. They can also earn every academic degree virtually – all the way from a career certificate to a doctorate.

Reducing the Total Cost of Studying

Online programs can be a more affordable option than traditional colleges, because of the amount of money that can be saved simply by not physically being in a school. Though not all online degrees have less expensive net tuition prices than traditional colleges, associated costs are almost always less expensive.


For one, there are no commuting costs. A student can save $40 to $60 (sometimes even more) every month just because they don’t need to take the bus, a cab or even their cars when going to school. Renting out a dormitory is out of the question, and that’s a lot of savings for a student. Furthermore, there are much less required course materials such as textbooks or handouts because their digital alternative is often available for free online.

Eliminating Commuting

Aside from the amount of money that students can save by eliminating the requirement of commuting, there are also safety issues that can be solved through online learning. Students can be safe from natural disasters, road accidents, or even rogue attacks from pick-pockets (though that’s not exactly likely) through in-house schooling.

During snowstorms and thunderstorms, colleges may cancel classes; if they don’t, you run the risk of getting hurt in dangerous driving conditions. Rather than miss important class sessions, students in online courses can always “attend” by participating on discussion boards or in chat sessions, turn in their work on time, and watch lectures or read materials. Not having to commute from home to the college poses a lot of benefits for all types of students.

More comfortable learning environment:

Studies have shown that students with the most comfortable learning environment learn the most – that is, depending on how the students perceive comfort. Some students prefer studying in their pajamas. There are students who prefer studying in cooler environments, while some prefer room temperature. Sometimes, campus seats aren’t the most comfortable ones, too! The truth of the matter is that enrolling in online courses allow students to choose (or make) their own comfortable learning environment.


At the end of the day, there is one underlying benefit of being enrolled in online courses: there are no physical class sessions. Lectures and other materials are electronically sent to the students who can then complete assignments in the comfort of their own den. Students do not have to endure the stresses of going through heavy traffic, finding parking spaces, leaving work early to get to class on time, or missing out on other important engagements as opportunity costs.

Plus, online course students can also take a power nap whenever they want to without having to deal with the banter of professors. Their learning environment is of their own making, and they can customize it to the fullest to achieve the best learning environment.

Aside from comfort, students can also make their learning more effective by having access to tools or supplements that aren’t generally allowed during class. For example, students can enjoy munching on brain food such as nuts while listening to a lecture or taking an examination.

Convenience and flexibility:

Online courses give students the opportunity to plan their study time around the rest of their day, instead of the other way around. Students can study and work when they are at their peak energy, whether that’s early morning or late at night. If a student is an innate night owl, they can easily adjust their schedule to effectively attend to their class requirements.


Also, course materials are always accessible online, so there’s no need to schedule special trips to the library. The best part is that should a student miss a lecture (because of an emergency or a medical issue), he or she can view the materials any other time of the day. Furthermore, students have the chance to use the resources from available applications like that from Team Treehouse or Khan Academy as the need arises. All of these makes online learning a good option for students who need to balance their work, family time or any other commitments.

More Ways for Students to Concentrate:

Online courses offer students facing challenges in terms of socializing (such as innately shy ones and socially anxious ones) the opportunity to participate in class discussions or chats with more ease than face-to-face class sessions.

Online courses help introverts or students with social anxiety cope better in terms of learning. They won’t need to talk more, to be forced in recitations, to put themselves in embarrassing situations, or be hindered from learning just because they simply can’t socialize as well as others.

Career advancement:

With the technology right now, students can take online courses and even complete entire degrees while working, while in-between jobs, or while taking time to raise a family.


This academic work can explain any discontinuity or gaps in a resume as well. Also, earning a degree can show prospective employers that the student is an ambitious and driven individual, and would want to remain informed and prepared for any new challenges.

Improve other skills like technical skills:

Even the most basic online course requires the development of new computer skills. As students learn to navigate different learning management systems and programs online, they acquire basic skills pertinent to their future profession.

The skills students learn while participating in their online courses translate to actual profession job skill set, including creating and sharing documents, incorporating audio/video materials into assignments, completing online training sessions, among other functions. These are tasks that students, however they completed their education, need to know while working in the workplace anyway.

4 Tips for Better Personal Financial Management

Don’t wait for next year to start paying attention to your finances – you should start managing them as soon as possible.

Personal financial management is not something that you can master overnight. It takes effective understanding on how to create a budget and stick to it, among other things. If you’re looking for the basic and most effective guidelines on financial management, here are your four top tips that can help you with your money matters:


First Tip: Make sure you get paid based on what you’re worth, and then spend less than what you earn.

To discover your Point A on your money management journey, start off by making sure you know the industry standards on how much your job is really worth: you can do this by conducting an evaluation of your skills, productivity, job tasks, contribution to the company, and the going rate, both inside and outside the company. Being underpaid even a few hundred dollars a year can have a significant cumulative effect over the course of your working life.

This seems like a no-brainer, but the concept of professional worth tends to be set aside due to various reasons – lack of confidence, feeling of desperation, or even guilt. This may seem basic to any professional, but it is a critical element to make sure you can actually get what you deserve.


Then again, no matter how much or how little you’re paid, you can never reach your financial goals if you spend more than you earn. Often, it’s easier to spend less than it is to earn more, and a little cost-cutting efforts in a number of areas can result in big savings. Start off small by choosing the cheaper options of what you usually buy. Keep in mind that it doesn’t always have to involve making big sacrifices just to create that balance.

Second Tip: Create a Budget Plan, and stick to it!

It doesn’t matter if you’re living paycheck to paycheck or earning six-figures a year, you need to know where your money is going if you want to have a handle on your finances. Unlike what most people believe, budgeting isn’t all about restricting what you spend money on and cutting out all the fun in your life. It is about understanding how much money you have and where it goes, then planning how to best allocate those funds.

The first step is to create a budget plan. What you do is to gather every financial statement you can, record all of your sources of income and create a list of monthly expenses. You also need to determine the fixed and variable expenses, total your monthly expenses, and finally make adjustments based on your needs and wants.

Now that you have a budget plan ready, make sure you’re going to stick to it. Of course, it’s not wrong to make adjustments when you’re just starting out, but be sure that you’re always on track with what’s really going on with your plan. Remember: numbers don’t lie.

Third Tip: Have a Savings Plan

You may have heard someone say, “Pay yourself first”. The chances that you’ll never have a healthy savings account are high if you prioritize paying off your other financial obligations before seeing what’s left over for saving.

Resolve to set aside a minimum of 5% to 10% of your salary for savings before you start paying your bills. Thanks to technology, there are many automated ways online for banks to save a certain part of your money to another savings account; use this to your advantage.

Fourth Tip: Maximize Your Employment Benefits

Employment benefits like flexible spending accounts, medical and dental insurance, etc., are worth more than their face value. Company benefits are part of the reason why employment rates are rising even in the midst of global financial problems. The sad part is that more often than not, these benefits are often unused by most employees.


Make sure you know what your job offers. Maximize your benefits and take advantage of the ones that can save you money. Without you knowing, you can reduce your daily expenses and other costs of living, especially when emergency situations call for it, such as medical bills or dental check-ups.

How I Learned to Track My Personal Expenses

Not so long ago, one of the most challenging aspects of my day-to-day life was handling my finances. Anyone would agree when I say that everything that we do is all attached to how well, or not, we handle our finances. From my professional engagements to my personal agendas, how much money I have keeps popping up as a factor in my decisions.

After this realization, I just had to check how well I was doing with my “personal financial management.” Apparently, I needed some help.


One of my closest friends, who happened to be a licensed financial planner and the Chief Financial Officer of his own company, decided to come to my rescue. I asked him how he keeps track of his finances. I thought he would throw me a one-liner answer like “Go to the bank” or “Just stop spending.” He gave me much more. He gave me insights that would turn out to be my guide which I could use for my journey towards better money management.

I have learned that everyone has his own story tell. The same is true with the way one handles their own money. Though there are 1,001 guides in money management out there on the internet, knowing my challenges and realizing the need to act upon my financial needs is always a good way to start.

That fact alone has helped me take on the challenge of taking my money matters head on.

True enough, his concepts – a path, if you will – which I still use up to this day, on how to make sure I have money when I need it have indeed cleared the way for my personal betterment. I have to admit, I still slip up from time to time. However, as long as I stick to the basic ideas he taught me, I know I can always catch myself in times of financial turmoil, and begin to steer toward the brighter side of things.

Let me share with you what I have learned:

Follow the map – Know your Point A

First, I realized that I need to follow a financial map of sorts. Just like any other map, there are three main components: Point A, Point B and the path from A to B. Simple enough.


With regard to keeping track of my finances, my financial planner friend emphasized that it is important for me to know where I am coming from. I needed to dig deep to see where I am right now in terms of my finances – am I a positive, i.e. I still have money left every month after using most for my expenses and setting aside for my savings; or negative, i.e. l already run on fumes half way through the month and always end up dry by the end.

After learning that I vary from positive to negative erratically every month, we later on settled that I am, in fact, ending up as negative in my finances, as it happens more often.

All the information I got from knowing my Point A was critical as it determined my action plan. It also helped me choose what would be the most viable and rewarding Point B for me.

Call it a huge wrecking ball of a wakeup call.

From Point A to Point B

After shaking off the shock, I decided it was time to move forward and look for the light at the end of the tunnel. I had to raise the bar and start acting on the financial results I wanted for myself. True enough, he asked me “where do you want to go?” Starting from a negative monthly balance, I needed to decide what positive state I wanted to achieve before I took any action towards tracking my finances and achieving financial freedom.


By this point, I felt as if I was talking to a professional bookkeeper from Xero Castle Hill – we were actually going somewhere as I started creating declarations of where I wanted to be. It absolutely did help me in my cause to know the amount that I wanted to be at by the end of every month and the amount I needed to spend in that same month. It was all about that numbers that would work for me.

It seemed basic at the time, but I later learned that we tend to be overwhelmed and lost when financial disasters strikes, making everything else seem more chaotic than usual.

Be open to the path

It is quite unfortunate to learn that people are used to just acting and doing things without even planning. And it is even more unfortunate when you learn that you are the one doing it! More often than not, this leads to a vicious cycle that tends to go round and round until something goes catastrophically wrong.


I just consider myself lucky that I was led out of that mouse trap before any irreparable damage was done!

Now that I was made aware of how I was handling my money and what financial state I wanted to achieve, I learned what to do next. Though the actions I needed to do were based on what I specifically needed, these tips can serve as a general  guide to others whom I shared these basic concepts with:

  • Prepare for the what’s coming

I have learned that I need to be committed, honest and open with the fact that I have to deal with my finances. Sometimes, finding out the state in which my finances are in can cause me to want to go back to the hole of indifference that I had been hiding in previously. Being open to any feedback that I’m lucky enough to receive and reacting to it with positivity is the most important step in improving. Plus, it always helps to be prepared!

  • Keep track of your spending

Every expense should be noted down in order to serve as your “financial breadcrumbs.” It may be daunting at first – keeping receipts for groceries, noting how much gas you get every week, even the daily budget for my food. However, the benefits are well worth it. You get to have a record of where you could have gone overboard. In doing so, you’re able to create a database that could lead you to save more, be more, and achieve more. At the end of the day, that is what is most important.

  • Plan

Before you go into your “financial battle,” you need to lay down your course of action. I do this not for the world to see but for me to see my financial vision more clearly. Just like in the old saying “If you fail to plan, you plan to fail,” I want to make sure that what I do achieves the success I deserve since I have already planned out my next step. Also, any plan in tracking my finances aims to lead me to the right path every time – my ultimate goal of financial freedom is definitely a possibility.


  • Execute

With my path already laid out in front of me, it is just a matter of sticking to the plan until I achieve my financial goal. Throughout my working years, I have experienced the challenges that often come along with any financial journey. However, with the passion, conviction and the drive to follow the goals I had set for myself, whether it is the stern budget, expense threshold or mindset to avoid using credit cards, I learned to strictly stick to it because that is the commitment that I have set for myself.

Life Insurance Hacks: Basic Tips to Get the Cheapest Premium

Getting Life Insurance can be expensive. An insurance premium can often cost you more than what you can get for term life insurance, and it could prove to be pretty bothersome at times. However, it doesn’t have to be. There are ways for you to get the most out of an insurance deal, and you won’t need to be buying expensive premiums just to get a good deal.

Here are some tips for you to get the best Life Insurance available:

Considering Term Life Insurance Policies

As the name implies, Term Insurance policies provide protection for a specific period of time and generally pay a benefit only if the insured passes away during the “term.” Term periods typically range from one year to 30 years, with 20 years being the most common term.

One of the biggest advantages of term insurance is its lower initial cost in comparison to permanent insurance. Term Insurance is generally cheaper because you’re generally just paying for the death benefit – the lump sum payment the beneficiaries may receive upon the death of the insured, provided that it happened within term of the policy. As with most permanent policies, your premiums help fund the death benefit and can accumulate cash value.

couple discussing insurance

Term insurance is often a good choice for people in their family-formation years, especially if they’re on a tight budget, because it allows them to buy high levels of coverage when the need for protection is often greatest. Term insurance is also a good option for covering needs that may disappear in time. For instance, if paying for college is a major financial concern but you’re pretty sure that you won’t need life insurance coverage after the kids graduate, then it might make more sense to buy a term policy during your children’s college years.

Also, you can always just renew your Term Insurance if – which is the best case scenario – nothing bad happens to you during the “term”.

Get More than One Quote

The two most basic keys to getting cheap Life Insurance is to focus on getting a Term Life Insurance policy, and to get quotes from multiple providers. So, shop around!

Life Insurance is basically a purchase. Just like most purchasing decisions, finding many options can give you an edge. Most people don’t bother obtaining multiple quotes because it’s time-consuming. It could be an arduous task, but surely it would be better to spend more time before closing a Life Insurance deal than to regret your impulsive choices.

With today’s technology, there are now ways to go about the time-consuming aspect of finding multiple quotes for your Life Insurance policy. For example, using an online life insurance quote tool is the quickest way to get quotes from several reputable insurers at one time.

Avoid Riders and Additional Insurance

Riders are the supplementary benefits added in the primary life insurance policy purchased by the insured. These are the additional covers offered to the insured with the main policy so that the insured can get additional benefits under the single plan. Although they are nifty by nature, these riders entail additional costs to the insured in the form of increased premiums.

happy family

If your goal is to find the cheapest insurance possible, the best course of action is for you to say no to any add-on insurance or policy riders. Examples of these add-ons include the option to purchase child policies or more insurance at a future date without going through the medical exam process again.

Then again, there are “good” riders that can be beneficial in the end. Riders can be purchased to accelerate your death benefit and pay you out for medical expenses if you have a terminal illness but haven’t passed away yet. Term conversion is another rider that allows you the option of converting your Term policy to a Permanent (whole life) policy.

By the end of the day, you have to choose your coverage wisely. If you need coverage for your kids, then it’s totally fine to pay for the extra fee – but make sure that you actually “need” these coverage. Also, if you’re someone who is on the fence between term and whole life coverage, the Term Conversion Rider can give you that option for a few additional dollars per month.

Check your Lifestyle

For most Life Insurance Policies which are taken out over an agreed period or term, your premiums are based on a number of factors. When you apply for Life Insurance, your insurance company assesses certain criteria and details about you and your lifestyle in order to determine the cost of your premiums, and whether or not they would accept your application based on what you tell them.

insurance agent

This is one of the few insurance products that have the price tailored specifically to you, and your provider takes into consideration some or all of the following:

  • Age: Here’s a general Life Insurance rule of thumb: The younger you are, the better health you’re likely to be in, so getting a life insurance early on can mean lower premiums. Put simply, the younger you are when applying for insurance, the cheaper it could be.
  • Health and weight: If you are classed as overweight or obese based on a height-to-weight ratio measurement, you may pay more for your policy. This is because your insurance company could assume that if you are overweight, you are more likely to suffer from weight-related health problems.
  • Medical history: Most life insurance policies are medically underwritten, thus, you have to provide information about your immediate relatives’ medical history. Your insurance company, however, do pay particular attention to your medical history. Also, watch other small details – cholesterol levels can affect your rates, as insurers often give relatively more expensive premiums to those with already high cholesterol levels.
  • Occupation: Some professions carry a greater risk because of their day-to-day duties, so you might find that this impacts the cost of your insurance. A fireman, for example, is likely to pay higher premiums than an office worker.
  • Lifestyle: You can be asked to provide details of any habits or hobbies that play a regular role in your life. Frequent smoking and drinking are likely to increase your insurance rates because of the toll they can take on your health. Certain high risk pastimes could also affect your premiums, including sky diving, mountaineering, and motor sports, among other extreme sports.

Get in on a Group Policy or Bundle your Policy

Most of the corporate benefit programs nowadays offer Life Insurance that doesn’t require a physical exam or for you to undergo any medical tests. While the amount you can take out is often limited, it is a way to get some coverage if you feel that you are currently unfit or fear that you are unable to afford the premium by yourself. Becoming a member of an association or organization can often get access to a group life insurance policy in many cases.

more happy family

Also, another way to receive discounts on your quoted life insurance rate is to bundle coverage with your car, home, or other insurance. Large-scale insurers now have features that can be fairly cheap in the long run because they give you the most options to bundle. A good strategy to maximize your bundled discounts is to review all of your insurance at the same time and pick the company that can give you the best deal for switching.

Getting life insurance doesn’t need to be a tall order for anyone. If you follow these tips, surely you can reduce your life insurance premium costs and live a more comfortable and secured life.

How To Hire A Bookkeeper: A Guide

The abundance of cloud-based software that ultimately propelled the usage of cloud-hosted bookkeeping has made basic accounting and bookkeeping accessible to even the smallest businesses. Online bookkeeping services such as Quickbooks Online allow for many ways to high-tech accounting such as organizing all assets in one place, and also through various consoles such as computer, mobile phone or tablet.

Managing cash flow through different financial tools and well-balanced budget programs is crucial to the success of every business. Recording transactions and keeping an accurate ledger can mean the difference between having a profitable fiscal year or a year of waste and unnecessary tax audits.

The abundance of cloud-based software that ultimately propelled the usage of cloud-hosted bookkeeping has made basic accounting and bookkeeping accessible to even the smallest businesses. Online bookkeeping services such as Quickbooks Online allow for many ways to high-tech accounting such as organizing all assets in one place, and also through various consoles such as computer, mobile phone or tablet. Technology made sure that there are many ways to accurately, safely and efficiently track every item that goes in and out of a business enterprise.

A bookkeeper working

Nevertheless, outsourcing some of these important tasks to a professional bookkeeper helps businesses maintain accuracy and compliance standards. However, hiring or investing on a professional bookkeeper always spend more time innovating the core business model, as well as the whole system itself.

If you’re a starting businessman, or a rising medium-scale proprietor looking for a bookkeeping service for the first time, you have to understand the basics of hiring a third party for your bookkeeping. You have to first understand the definition of the types of bookkeeping services available, the criteria for comparing bookkeepers, and many more about finding the best bookkeeping service vendor.

The Fine Line Between Accounting and Bookkeeping

Before moving on to the specifics of bookkeeping services, it’s important to note the clear distinction between bookkeeping and accounting services. A good number of businessmen has made the rookie mistake of not defining the difference between the two.

Accounting vs. bookkeeping.

Accounting serves in a consultative capacity, using financial data as a baseline. According to, accounting typically involves advanced reporting and business analysis, in addition to the rigors of corporate tax management. “Many accountants also provide advisory services for debt and finance, mergers and acquisitions, and trust planning,” they added.

In other words, an accountant uses bookkeeping data to support higher-level accounting requirements such as preparing sales tax, reducing product costs, and setting financial benchmarks.

On the other hand, bookkeeping is similar, yet different. A bookkeeper is responsible for recording the data that accountants use to generate reports and make decisions. In that sense, the two disciplines have a symbiotic relationship. It’s often defined in a way that bookkeeping is designed to generate data about the activities of an organization, whereas accounting designed to turn data into understandable and identifiable information.

The Market Overview of Bookkeeping Services

The standard practice for businesses of every size is to hire an outside accountant. The thing about outsourced bookkeeping is that it tends to be most prevalent among small and medium-sized businesses (SMBs), because SMBs have the same data entry and budgeting needs, but with less employees and/or resources to support it financially.

When it comes to financial reporting, being stretched far too thin can mean costly errors and a budget that never lines up with actuals. This is again one of the beginner mistakes that businessmen make (or simply take for granted), along with not keeping their records up-to-date, and not understanding their tax obligations. Also, failing to reconcile ledgers with bank statements, not recording reimbursable expenses, and running an inaccurate payroll are simple mistakes that SMB proprietors usually commit.

Woman bookkeeper.

Arguably, these sort of mistakes can slow down a business. Then again, it could easily be solved by outsourcing the bookkeeping requirements and putting their accounts in the hands of a trained professional. Business owners can focus more of their attention on bottom-line strategies like customer retention, product development, supply chain optimization, and expanding to new markets, at the cost of a little bit more capital.

Analyzing Bookkeeping Services

You may already have a specific bookkeeper or bookkeeping firm in mind, based on a referral or someone you’ve worked with in the past. Then again, the best way is to invest a little bit more time and effort to make the perfect business match.

The best way to invest it is through a personal interview with the bookkeeper. It’s important to compare and interview a few different candidates before you make the final decision. Here are some criteria to consider when screening your bookkeeping candidates.

Bookkeeper keyboard.

Define the Scope of the Owner-Bookkeeper Relationship

First, define how involved you need or want your bookkeeper to be, and what the relationship will look like.

Many businesses start by hiring a contractor to come in a few hours a week, or even as infrequent as once a month. Some businesses offer a bookkeeping services price list for standard arrangements, too. Also, it is best if you ask for it ahead of time so you can perform a cost and benefit analysis for hiring a bookkeeper.

Ask about their Accounting Software Specialization

Whoever is not keeping up with the race of accounting software or cloud-computing provision is not worthy of being hired at all; the efficiency and flexibility of the technology on bookkeeping should be used as much as possible.

Bookkeepers now have a particular accounting software system they specialize in. Some are even certified with popular vendors like QuickBooks  and Sage. This is very important to consider, especially when you’re already using a particular system to manage finances. Ideally, the bookkeeper you choose will know their way around the software and be able to get started right away.

Proven Track Record

In evaluating a bookkeeping candidate, always move past the resume and look for actual proof of success. Better yet, ask for some of their case studies from previous positions where the bookkeeping firm served a business similar to yours.

Furthermore, you can follow up for references, or ask other colleagues that have worked with the bookkeeper for their opinion. In this case, “success” might be defined as saving the business money through accurate record-keeping, increasing tax compliance, or streamlining financial reporting.

Some Examples of Bookkeeping Services

Although most bookkeepers share the same core competencies, they don’t all have the same experience or offer the same services. Here’s a breakdown of the four most common bookkepper categories:

Certified Bookkeeper: Aside from getting NACPB and AIPB certifications, bookkeepers may also get certifications for particular accounting software, certified to manage payroll, or certified in tax management. Generally, the more certifications a bookkeeper has, the more services and discretion they’ll be able to provide.

General Bookkeeper: A general bookkeeper offers basic services like data entry and account reconciliation. Think of it as a general physician in the field of medicine. As such, general bookkeepers tend to have lower rates and work lesser hours. They are usually uncertified, which meant that they have less on-the-job experience. A general bookkeeper can be a good choice if you have a limited personnel budget and do your own financial reporting and payroll.

Full-Charge Bookkeeper: A full-charge bookkeeper title denotes more advanced financial management and a closer relationship with company executives than that of a general bookkeeper. Full-charge bookkeepers usually manage payroll, fixed assets, invoices, and other financial statements, and some may even serve an accounting/advisory role. They could be certified bookkeepers, but usually full-charge bookkeepers have a one-size-fits-all approach to tend to most bookkeeping needs.

Virtual Bookkeeper: Virtual bookkeepers are the most uncommon of the four types. Virtual bookkeeping services are an attractive solution for smaller businesses and startups looking to outsource their financial records, but not ready to work with (or pay for) a dedicated contractor. Bookkeeping virtual assistants accept financial documents electronically, update your ledgers, accounts, payroll, etc., and send back copies of reports for your records. Since they are not as stable as the others, the risks you have when hiring these are indirectly proportional to the price you are paying them: Higher risk with lower salary and vice versa. Virtual services are convenient and cost-effective, but they can add to the challenge of maintaining a clear audit trail.

3 Habits of Money-Smart People

Money management is the ultimate tool in ensuring a particular business to withstand the test of time. In this regard, an individual who wants to effectively handle a business well should be mindful of the money coming in and going out of the business. Similarly, businesses should take into consideration a proper accounting method to promote efficiency and high level security. MYOB Accounting Software and other online accountancy tool can be the first stone that leads to leaps and bounds for the company.

In these economically harsh times, people are now required to become more aware of how they spend money. For those who are just starting their career, such as new college grads, it is especially significant that they take steps that can help them endure their independent, brand new life that they will have to face.

Counting money

Everyone has to go through the phase of having to be independent. However, independence does not only encompass living alone without the parents. Independence also means having to know the fundamental skills required in enduring daily life such as cooking, cleaning, and other chores at home. Similarly and most importantly, independence requires a person to be financially-stable and able to live within his or her means.

This begs the question – How can someone become financially stable?

The road to being financially successful is a tediously long one. Who better to emulate than those who have survived that stage in life. The ones who have flourished amidst the hard times?

So what does it take to take the first step towards financial freedom? Here are three of most important habits of a financially-stable individual that could help anyone financially win in life:

They Spend Wisely

An important facet for a person in becoming financially stable is having the awareness of how money works for them. Being ‘money-smart’ is a prerequisite for those who want to become truly financially free.

But how does one become money-smart?

locked wallet

It all begins with a mind-set of proper allocation. It is pertinent to practice buying only what is needed, as well as spending on things that are only necessary. Nowadays, it is so easy to give in to the “finer things in life.”

Luxuries like the latest gadgets, the finest clothing, and the coolest shoes can actually make a person dead-beat with regard to finances. Similarly, availing luxury services such as a thousand dollar spa or a ten-dollar coffee can haunt a person financially in the end. This is why a person should start to set his or her mind to only spend on things that are truly important.

This is not to say that luxuries in life are bad. The point is that for a person aiming to be financially independent, one has to inculcate a sense of awareness as to how their money is spent.

On another note, financially-stable people are aware of the fact that a person should not spend the money that he or she doesn’t have. Basically, it means that a person should not opt to be extremely indebted to a third party like a bank or a financier.

Credit cards are thought to provide a huge plus in one’s financial self-worth. This is actually a misguided notion because credit cards promote spending, and relentless spending opens more doors to financial roadblocks. Successful people always make it a point to eliminate any debt that may accrue interest. In turn, these accumulated interests can cause huge headaches financially in the long run.

They Save Wisely

The result of spending wisely is having a surplus of money – this is where saving wisely comes in. As any financial coach or expert would declare, saving money is an integral aspect in having a good financial life in the future. Nonetheless, there are some more exciting ways money can be saved, and can even provide profits at the same time.

Banking is the most commonly opted approach in saving money. Over time, money saved in a bank account can accumulate interest. The amount of interest can be noteworthy for people who put a lot of money in their account. However, for people who are at the beginning of their careers, it is difficult to reach that point where the interest gained is of significant value.

It is rare for banks to give out interest greater than 5% on a certain savings account. Naturally for smaller accounts, lower interest is accrued. In this light, an alternative method is opted by those who save wisely; they create more when they use their money for trading in the stock market.

Mutual fund.

Various firms and companies cater to those who want to earn more money. Money managers use the amassed amount in this way through two distinct means. They can use the money as principal to participate in stocks exchange. On the other hand, mutual funds promise an interest at the end of the year that is much higher than that of the banks. Either way, both are better alternatives to save up and get more from their money.

There is also the option to play in the stock market personally. He or she can buy or sell his own stocks online, giving him an idea of the current money he has. Ultimately, the money gained through this vehicle saved can be used for further ventures such reinvestment or setting up an entirely new business.

They Set-Up Their Own Business

Being able to get a salary after a month’s hard work proves to be quite an experience. However, being able to earn passively takes earning to a whole new level.

Rich guys are not necessarily geniuses or experts in the services their companies offer. They are just really good entrepreneurs, and most of them started as a dissatisfied and restless employee who wanted more for themselves. With the surreal amount of work and the time it takes to finish a certain job, not to mention the relatively lower salary, it is hard to get home and put in the extra effort to make a bigger change.

Open your own business.

In more ways than one, people should consider setting up their own businesses to reach the financial freedom everyone clamors for. Though, this isn’t naturally for everyone.

Having a business takes time and effort, too. Entrepreneurship provides control over an individual’s time for professional activities. He or she is his or her own boss, and this alone creates a huge disparity as compared to being an employee.

A person who has his own business can take himself to brand new landscapes, given that he or she is willing to take the risk in business. In this way, what can actually help is integrating a sense of of becoming money-smart in the business.

Money management is the ultimate tool in ensuring a particular business to withstand the test of time. In this regard, an individual who wants to effectively handle a business well should be mindful of the money coming in and going out of the business. Similarly, businesses should take into consideration a proper accounting method to promote efficiency and high level security. MYOB Accounting Software and other online accountancy tools can be the first stone that leads to leaps and bounds for the company.

The world has evolved into an unforgiving place to people who are not financially-stable. This is why it is essential for young professionals to open themselves to success habits of those who have flourished financially. There are obvious schemes which these successful people made in order to go where they are now. Besides, if a person wants to be the best, there is no mistake in imitating the best.

Money problems


All in all, people should always look forward to being financially independent, while taking small important steps towards a life of true financial freedom.

Being money-smart is a fundamental step towards a great life.

Forensic Accounting: The Action-packed Side of Accounting

Also, in the advent of technology, many types of accounting fraud have come from the rising cloud-based computing Although a great number of online accounting service providers such as Xero Software and Quickbooks Online are already on high alert in terms of digital security, delinquents can still think of ways on how to commit financial crimes.

For some farfetched reason, accounting has been deemed as an uninspiring profession. There is a big chance that those who see this career as a dreary job imagine bookkeeping as mainly crunching the numbers and making sure that column A should match column B at the end of the day. Of course, this is not true at all.

Financial report.

Nonetheless, there is a colorful part of accounting that is very interesting as it mixes all the aspects of accounting with Criminal Law, Technology and a lot of Psychology. You may not have heard it before, but there exists an enthralling and grueling part of accounting called Forensic Accounting.

What is Forensic Accounting?

The integration of the academics of accounting, auditing, and investigative skills yields the specialty known as Forensic Accounting.

It provides the stakeholders (businessman; accountant; lawyer) an accounting analysis that is suitable to the court which will form the basis for discussion, debate, and ultimately a dispute resolution. Forensic Accounting encompasses both Litigation Support and Investigative Accounting.

Forensic accounting

If you are new to the term, you might picture private investigators in a crime scene holding calculators instead of cameras or magnifying lenses. Perhaps you might imagine a bookkeeper wearing gloves while studying a ledger. Well, that’s all but the figurative idea behind Forensic Accounting. While it’s not about studying a crime scene or a corpse in detective clothes and all that jazz, it’s all about interpreting and supplying the proper data to study a criminal case in finance and accounting.

The term “forensic” means “relating to courts of justice or public disputes” or “suitable for use in a court of law”. Forensic accounting involves the use of accounting expertise in court and litigation cases, fraud investigation, claims and dispute resolution, and other areas that involve legal matters. Unlike the popularly dramatic forensic setting that focuses on extraction of DNA and bullet trajectory calculation, forensic accounting deals with financial and corporate crimes such as fraud.

What Do Forensic Accountants Actually Do?

The recent cases of fraud and finance-related crimes, a need for the deterrence and detection of these fraud cases has become widespread and highly intensified. This is the reason forensic accounting continues to gain a rapidly increasing popularity in the world of business and finance.

Also, in the advent of technology, many types of accounting fraud have come from the rising cloud-based computing. Although a great number of online accounting service providers such as Xero Software and Quickbooks Online are already on high alert in terms of digital security, delinquents can still think of ways on how to commit financial crimes.

Basically, forensic accountants have two major types of responsibilities: Investigation and Litigation Support.

accounting graph

Investigation involves the examination of potential and actual evidences that could suggest the existence of fraudulent activities and the pertinent information associated with them. This includes witness statements, documents and data (bookkeeping ledgers, receipts, etc.), “real” evidence (such as sample construction materials from a road site), and demonstrative evidence such as photos, charts and graphs.

On the other hand, the Litigation Support part of Forensic Accounting urges forensic accountants to provide legal assistance – the type inclined to the calculation or estimation of economic damages and related issues – in a given case. Forensic accountants can also act as expert witnesses in courtrooms where they can provide valuable points that should be useful in deciding over cases regarding financial fraud.

A Forensic accountant is often hired to analyze, interpret, summarize and present complex financial and business related issues. With their expertise, they can translate raw data to a language that other people can comprehend; all to make it in a manner which is both understandable to a courtroom (for example) and properly supported that a jury can evaluate.

According to, A Forensic Accountant is often involved in the following:

  • Investigating and analyzing financial evidences
  • Developing computerized applications to assist in the analysis and presentation of financial evidence;
  • Communicating their findings in the form of reports, exhibits and collections of documents; and
  • Assisting in legal proceedings, including testifying in court as an expert witness and preparing visual aids to support trial evidence.

In order to properly perform all of these services, a Forensic Accountant should be familiar with legal concepts and procedures. This means that Forensic Accountants should have a specialization in certain concepts of political science. In addition, a Forensic Accountant must be able to identify the concept of “substance over form” – which is a common technique in financial legal management – when dealing with an issue or  case.


Forensic accountants are also highly skilled in the ins and outs of most fraud schemes. They are usually hired to lead investigative works and provide recommendations to mitigate the likelihood of fraud activities from occurring. Forensic accountants can also work with incidents of negligence, bankruptcy, contracts, and other cases that involve recovery of damages.

How Does Someone Become a Forensic Accountant?

Because of the increasing popularity of this field, many schools now offer degrees and training programs related to forensic accounting. The first thing that you should do, if you wish to become a forensic accountant, is to finish a bachelor’s degree in Accounting. Forensic accounting courses are usually offered as a Master’s degree.

Then, you have to look for Forensic Accounting Certification programs. Accounting certifications in this field can help you establish your value and recognition in the society. Holding a certification proves that you are qualified to perform services in such field. This will help you get hired by firms and kickstart your career as a forensic accountant.

To add flavor to Forensic Accountants, these certifications available for recognition almost globally (although the certification itself is not available in all parts of the world):

Certified in Financial Forensics (CFF). This certification is granted by the American Institute of Certified Public Accountants (AICPA) to Certified Public Accountants (CPAs) who have developed expertise in the forensic accounting field. This is an additional accreditation you may wish to consider in addition to having a CPA license.

Certified Forensic Accountant (Cr.FA). The American College of Forensic Examiners

International (ACFEI) grants the Cr.FA credential also to CPAs who meet their certification requirements.

Certified Fraud Examiner (CFE). The CFE is a globally recognized professional designation for individuals who specialize in fraud prevention, detection and deterrence. It is offered by the Association of Fraud Examiners (ACFE). CFEs exhibit proficiency and professional excellence in performing services to uncover fraud and implement internal controls and systems to prevent them from occurring.

Can People Make a Good Living out of Forensic Accounting?

Yes. Forensic accounting is one of the fastest growing careers today, and may probably be the fastest in the accountancy profession.

More often than not, forensic accountants are hired by public and private employers who have a big business and are in dire need of their valued services. For instance, government agencies hire FAs to assist them in solving financial irregularities within their government accounting system. Sometimes, even the research and academe sector also demand for the FA’s expertise in the investigative field of accounting.


Having even just a background in the forensic accounting department makes accountants have a wider pool in the accounting horizon in general. It adds a lot of value in the qualification of an accountant that is useful especially to those who are in the management level positions and advisory departments.

According to, the average salary of forensic accountants in the US is around $75,000 with many earning more than $100,000 annually. “Six-digit annual salary is not uncommon in this type of specialization. The starting salary of forensic accountants ranges from $30,000 to $60,000 per annum,” they added.