Check out the financial tips for the second week of October 2012.

Tip no 1: Steer clear of debt consolidation companies that claim huge upfront fees even before they start working on your case.

As per the debt relief Act of 2010, consumers are not required to pay advance fees to the debt consolidation companies. These companies can charge fees only after they start working on your case. So, if a debt consolidator asks you to pay money before negotiating with the creditors, then don't sign a contract with him. This is a scam. Chances are high that the debt consolidator won't negotiate with the creditors to reduce the interest rates on your loan. He'll just take the money from you and vanish. You won't even be able to contact the person via phone.

Tip no 2: Start investing early.

When the question is to secure your future, it is never too early to begin investing. It is little intimidating to invest from an early age. However, you can acquire knowledge on finances very fast. You'll develop a habit of saving. You'll build wealth fast. The more money you make, the higher will be your chances of becoming a financially independent person. You can afford to live on your own. You won't need to seek monetary assistance from your friends or family. Chances are high that you may lose money by making some investing mistakes. However, you'll learn from these mistakes. You will become a seasoned investor with time.

Tip no 3: Talk with as many lenders as possible before choosing a particular one.

You talk to various retailers before purchasing an item. For instance, you're thinking of purchasing a laptop. You go to various retailers. You talk about the available offers. Finally you purchase a laptop from the retailer who offers you the best deal amongst others.

Likewise, when you're planning to take out a loan, you should talk to various lenders. Find out which lender is offering loans at good interest rates. Ask the lenders about the late fees and penalties. Borrow from the lender who offers the loans at suitable repayment terms. This will help you avoid financial problems in future.

Tip no 4: Carry the right credit card with you when traveling so that you don't have to pay any extra amount as exchange rate.

All credit cards don't offer similar facilities. So, it certainly helps to shop around for a credit card when traveling. Find out the best credit card by doing some research. Find out how much you've to pay on the foreign transaction fees. Usually, the credit card companies charge nearly 1-5% on the international financial transactions. You have to pay some other fees as well. This can increase the purchase price of any product to a great extent.

Choose a credit card which is accepted in almost all the places. It will be best if you get a credit card which does not charge exorbitant fees for currency conversion.

Tip no 5: Don't invest all your money in a single stock.

Never invest all your money in a single stock. You know that stock market is very volatile. The price of stocks goes up and down. If the price of the stock goes down by any chance, then you'll lose all your money. You may invest in a stock of a very good company to reduce your risk. After all, stocks of a blue chip company are less likely to perform badly. However, can you guarantee that the price of this stock will never fall in future? What if the country is hit another recession? What if the annual report of the company is very bad? The price of the stock is bound to fall.