Understanding Different Interest Rates

Understanding Different Interest Rates There are a variety of different types of interest rates, but in order to understand these, one must first understand that an interest rate  is a yearly price charged by a lender to a borrower in order for the borrower to obtain a loan, usually expressed as a percentage of the total amount loaned. Interest rates can either be nominal or real, though certain terms exist to define specific rates such as the Federal Funds Rate. The  difference between nominal and real interest rates  is that real interest rates are ones that are adjusted for inflation, whereas nominal interest rates are not; the interest rates one typically finds in the paper are nominal interest rates. The federal government of any given country can affect the interest rate, known in the United States as the Federal Funds Rate and in England as the Prime Rate. Understanding the Federal Funds Rate The Federal Funds Rate is defined as the interest rate at which U.S. banks lend to one another their excess reserves held on deposit at the United States Treasury Department, or the interest rate that banks charge each other for the use of Federal funds in general. Investopedia describes the Federal Funds Rate as the rate of interest banks charge other banks for lending them money from their reserve balances on an overnight basis. By law, banks must maintain a reserve equal to a certain percentage of their deposits in an account at a Federal Reserve bank. Any money in their reserve that exceeds the required level is available for lending to other banks that might have a shortfall. ï » ¿Essentially what this means for the average American is that when you hear that the Federal Treasury Chairman has raised interest rates, theyre talking about the Federal Funds Rate.  In Canada, the counterpart to the Federal Funds rate is known as  the overnight rate; the  Bank of England  refers to these rates as the base rate or the repo rate. Prime Rates and Short Rates The Prime Rate is defined as a rate of interest that serves as a benchmark for most other loans in a country. The precise definition of prime rate differs from country to country. In the United States, the prime rate is the interest rate banks charge to large corporations for short-term loans.​​ The prime rate is typically 2 to 3 percentage points higher than the Federal Funds rate. If the Federal Funds rate is at around 2.5%, then expect the prime rate to be around 5%. The short rate is an abbreviation for short-term interest rate; that is, the interest rate charged (usually in some particular market) for short-term loans. Those are the major interest rates you will see discussed in the newspaper. Most of the other interest rates you see will usually refer to an interest-bearing financial asset, such as a bond.

How to Make Connections with College Professors

How to Make Connections with College Professors By all means, form as many bonds and make as many friends as possible while in school, but don’t neglect the connections you form with college professors. Those can come through in tight spots professionally, and professors are typically well-connected amazing people. Let’s talk about 5 solid ways to get close without stepping over any bounds. 1. Impress the Connections out of Them There’s so many faces like yours coming and going; so many papers to grade, cups of coffee to drink and meetings to attend. You’re going to have to stick out without being a jackass. If you’re trying to get either the professor or other students to laugh during class, you’re probably not impressing anyone. Here’s a couple tips: Details: Pay attention to the little things because your professors will be. The quickest way to impress is to NOT do all the things they expect students to do. Be THAT person who takes the time to understand protocol, be prompt and pay attention to details! Now, don’t make light of this practice, just realize that it IS noticed and appreciated. Study Up: Has the professor written a book? Many books? Do they have a blog? If you take the time to get to know them as a person, you can see what motivates them. This way you can add nuances to everything you do that will catch their interest. Barely anyone does this, so it can work like a charm. Show interest in them. 2. Be Available Willing to Serve It’s not about what your professor can do for you, but what you can do for your professor. Don’t sit in the back of class, but don’t attempt to be a teacher’s pet either. Make it obvious what you’re doing, which is no different than your professor did. Making connections in college is par for the course (forgive the pun). Consistent: Don’t pester, but be consistent. Let them know you’re standing at the ready to be of service in any way possible. The Word: Don’t treat only one of your professors this way, but all those whom you think could become a mutually beneficial connection. Options: If they’ve already got their assistants covered and don’t need your help in the office, is there something you could do for them in their private lives? Cut the lawn? Landscaping? Perhaps just a some quality conversation on interesting class-related topics? 3. Set Up Communication Early On Don’t wait, quickly stop by their office to personally introduce yourself. Don’t be bubbly and overflowing with youthful angst, just relax and act as professionally informal as possible. Now, try not to mention grades, period. Instead, focus on these three things. Your Goals: Your goals are what you intend to learn from the professor. Don’t dehumanize them by only referring to â€Å"class.† Their Goals: Let them know you appreciate their position and knowledge without kissing their backside. Make it clear that it is your intention because you would like to impress them and get to know them better. There’s absolutely nothing wrong with this, and they know it. Keep it Short: No long-winded conversations for your first couple visits. Keep it short and stay well behind the informal boundary. A couple minutes is all it takes to make a great impression. 4. Don’t Ask to Be Called On Your professors should know you’ve got your act together. You study, you take the course seriously, you intend to get to know them better and you’re a star player. But, never make this obvious in class and NEVER try to upstage the professor in front of students. Wait: Don’t be a jabber jaw and or a Mr. Know it all. Why speak in class if you’re not called on? What’s the point? Are you really going to argue with someone and de-rail the professor’s plan for class? Defer: Instead of hogging the class conch, say what you need to say to make a good point and then pass it along. Do what you can to let other people keep the lime light. Listen: Keep your ears open and listen to the issues, concerns and problems that other students are having. This information can come in handy. If the professor sees you making their job easier, they’ll notice you for it. 5. Be Human Ask for Help If you’re having a hard time, or going through a crisis, don’t complain in class or complain to other students in the class. Instead, bring your very human issues to your equally human professor. Oftentimes they will bend over backwards to help students that need and ask for it without being a pain. Hope this helps. Remember, your professors are like windows into professional worlds. Don’t neglect them and do what you can to form mutually beneficial connections. So, what have you done to get closer to your professors? What’s working or not working for you?