Archive for the ‘Personal Finance’ Category
Saturday, March 13th, 2010
Create a budget.
Personal budget planning is absolutely crucial if you want to build personal wealth and overcome things like the credit crunch and the current problems that the economy is experiencing. The word “Budget” is one that worries a lot of people because it often seems more like a hassle and a chore than anything else, but there are a lot of easy things that you can do in order to create a personal budget planning process that is beneficial to you and your entire family and household. Here are a set of basic steps that will help you build a personal budget that is going to work well for you and your household as a whole
- Begin the personal budget planning process by collecting at least three months worth of bills, expense statements and receipts.
Look at your bank statements, cash transactions and any receipts that you have saved. Look through your credit card statements as well. What did you purchase? What bills did you pay? Were there any fees that you paid? Are there any habits in your monthly bank statements that are worth noting? Are you spending basically the same amount of money every month? Are there expenses that are the same or similar every month? Answering these questions will give you a good foundation for your personal budget planning.
- Now that you have a firm handle on your expenses, the next step is to gather documents relating to your income.
If you are on salary, put together your paychecks and make sure that you are getting the same amount every month. Otherwise you should gather between three and six months of income statements to get an average amount that you earn in a single month.
- Now that you have a good idea of both your expenses and your incomes, the next thing to do is to compare them to see how much money is left.
This may seem like a frightening step, but it is important if you want to know how much discretionary income you have every single month.
- Now that you know how much money exists at the end of the month on average, you can start looking at what expenses can be eliminated or reduced.
Review your expenses carefully to find out how you can leverage additional income on a monthly basis, because this extra money can be used to reduce debts and begin to save money for the future.
Now that your basic budget is outlined, you can begin to work on prioritizing your debts by reviewing interest rates and listing your debts beginning with the highest interest rate and working down. Once your budget and discretionary income have been outlined you can begin to plan for your financial future by outlining both short term and long term goals in your personal financial life. The last step is simply to exercise patience and to stay the course for as long as you can. Personal budget planning is not going to become a habit as quickly as over night, but it will eventually become a habit if you practice it regularly.
Photo Credits: 1
Originally posted 2008-11-13 05:58:04. Republished by Blog Post Promoter
Related Articles -
Managing Money Wisely [/caption] One of the hardest things for many people to accomplish is managing money wisely. We may all know the basics, and understand that spending too much is a good way to get on the road to financial ruin. However, when push comes to shove, we end up making mistakes...... -
Are Your Gadgets Sucking Your Wallet Dry? /caption] We live in a digital age and the vast majority of us rely heavily on numerous technological devices to get us through our days. What we may not realize however is just how much these gadgets cost to run. Companies throughout the United States are finding out that they...... -
8 Tips for College Student Budgets [/caption] Below are eight tips for college students about money and finances. 1. Track your Expenses If you track your spending for a few weeks, you will be better able to figure out where your money is going. Are you spending an exorbitant amount of money on Starbucks? You may...... -
Great Budgeting Examples /caption] When you are looking at ways to implement a family or individual budget into your household, one of the most proactive steps that you can take is to look at great budgeting examples from other sources. Because everyone has unique financial and budgetary needs, there is no real one...... -
Save Money by Managing Your Money /caption] There are plenty of ways for you to save money simply by managing it. It does not necessarily mean that you have to be frugal, but rather you simply have to be wise in the decisions that you make. Too many people these days are finding that they were......
Related Sites -
Your Money or Your Life Review Your Money or Your Life is not your average personal finance book. Weighing in at nearly 400 pages (including the prologue and epilogue), this selection seemed to be a "heavy" read. To the contrary, I found the book easy to work through, and extremely insightful and motivating. In fact, I'd...... -
How to create a workable budget The idea of creating a budget sometimes makes people throw up their hands in frustration, but it's not as hard as it may seem at first. Generally it's hardest when you have no idea of what your expenses might realistically be -- such as when you move out on your...... -
It's Time for Some Personal Budget Planning Tips Personal budget planning is an important part of keeping a handle on your finances. Because there is so much turmoil in today's economy, maintaining a healthy personal budget is more vital than ever. Crafting a personal budget begins with determining how money comes in, and how money goes out, but...... -
Personal Finance Equations You Should Know: the Amortization Equation Amortization is probably one of the most ubiquitous financial concepts that encompasses our daily lives, but yet, few of us know what it means, how it works, much less, how the monthly payments on all our stuff is calculated. By definition, amortization is: The reduction of a debt over time...... - Weekend Personal Finance Links (Catching Up Edition) After the last week in Aruba, I'm exhausted. It's funny how vacation just seems to make you more tired. Maybe it wasn't the vacation, but rather the trip from Aruba through Atlanta to Florida to see my friend get married. Except that I got a call from her 3 hours......
Tags: amount of money, bank statements, cash transactions, credit card statements, credit crunch, discretionary income, economy, expense statements, good foundation, hassle, household, income statements, incomes, least three months, paychecks, personal budget, personal wealth, receipts, salary, six months
Posted in Personal Budget Planning, Personal Finance, Smart Money Ideas | No Comments »
Friday, March 12th, 2010
Parents like to complain that their teenage children do not listen to them. However, when it comes to matters dealing with money, the opposite is actually often true. Teenagers often welcome the advice that their parents have to give regarding finances, money management and investments. In the past few years, teenagers have been earning billions of dollars through summer jobs and part time after-school work. Many of these teenagers have gone on to spend all of the money that they have made, while only a few have saved it up, only to end up spending on a larger purchase down along the line. Kids these days need to become more aware about their income and investment basics so that they can learn how to better manage their money as they get older. If you want your teenagers to manage their money more effectively in adulthood, then they absolutely have to learn the investment basics now.
Start training your teen about money.
It is your responsibility as a parent to begin training your teenage children to use their money more wisely now while they are listening. Here are some of the things that you can do to teach your children how to save and invest wisely so that they can have some money left over at the end of the weekend following payday.
1 – Lead by example!
This seems simple but it has an extraordinary impact. Your children are going to look at how you spend money and act accordingly. If you show them how you allot money to different purposes for household needs, bills and budgets, they will learn how to do the same over time.
2 – Help open a bank account for your teen.
Establishing a bank account for your teenager will allow him or her to have instant financial responsibility. Sit down with them and explain how they can manage their own account, and take a moment to talk about the rewards that can be received once they have saved enough money. These savings, for example, could go toward their college tuition or even to purchasing a car. The entire process of saving and earning will give them a significant sense of accomplishment, and they will have something concrete to show for their hard work and dedication to saving and investing wisely.
3 – Construct a spending plan for your teen.
Teens tend not to like the idea of budgeting, but you should not allow them to get by without a budget or a spending plan just because they don’t like the idea. Instead, you and your teenaged son or daughter should sit down and build a spending plan that will help them get excited about the idea of earning, saving and investing their money. Take the time to teach them the differences between what they need and what want, and what things are worth saving for. Once they know what they can do without, it becomes easier for them to save their money for investing.
Photo Credit: 1
Originally posted 2008-11-12 05:57:23. Republished by Blog Post Promoter
Related Articles -
Save Money with These 4 Tips /caption] There are ways that you can save money, and all you need to do is learn about managing money wisely to do it. You are not necessarily being frugal, per say, but rather you are learning how to be wise in the decisions that you make. Unfortunately, most people...... -
Do You Avoid Personal Budget Planning? /caption] One of the things that can make your life easier, even though it sounds complicated, is personal budget planning. If you're one of the fortunate few who never has to worry about running out of money no matter how many extra expenses might crop up or how much extra...... -
Free Investment Research Can Make Your Money Profitable /caption] Do you still recall learning how to conduct research in high school and college? If you are tired of researching subjects for school, it may be difficult for you to come up with a good reason to continue conducting research as an adult, but it is unfortunately a little...... -
Child Savings and Investment /caption] Having children is not cheap by any means these days, especially when you consider the long term basis. The older your children get, the more they will end up costing you, especially when you consider education costs which are rising with every passing year. It may seem easy to...... - Save Money by Managing Your Money /caption] There are plenty of ways for you to save money simply by managing it. It does not necessarily mean that you have to be frugal, but rather you simply have to be wise in the decisions that you make. Too many people these days are finding that they were......
Related Sites - Money-making idea: Journaling while you're learning a new skill A friend at work fixed up and rented a property in Maryland. He was telling me about the improvements he did, how he saved a lot of money by finding deals on good materials and doing what work he could himself, how he did the fixing up properly to code,......
-
Top 10 Ways To Green Your Children. photo by ogimogi I get individual questions from readers all the time about being green with children, so I figured putting together a post could be of some assistance. Let me know if I missed anything, and add it to the comments! 1. Ditch the disposable diapers. Nearly 20 billion...... -
Buying On Sale Does Not Save You Money! Rather, it costs you money, and probably more than you would have spent in the first place. I was having lunch with a friend on Saturday (who shall remain nameless) and we were talking about how much stuff he had gotten lately on sale at a few electronic stores. He...... -
Best Ways To Invest Small Amounts of Money Investing simply means putting your money to good use with the expectation that you’ll receive a return or reward for doing so. A lot of us don’t have much money to spare. Sometimes you may find yourself with an extra $100; maybe someone finally paid you back for a long-forgotten...... - 35 Low-Cost Ways To Green Your Lifestyle. And away we go! 1. Line dry your clothes. Dryers don't even come with an "Energy Star" rating - that's how bad they are in terms of energy consumption. Line or rack drying your clothes saves a ton of energy and thus CO2 from going into the environment. Cost: $20......
Tags: adulthood, billions of dollars, budgets, college tuition, enough money, financial responsibility, household needs, investment basics, Investments, kids these days, money management, parents, part time, purchasing a car, rewards, summer jobs, teenager, teenagers
Posted in Investment Basics for Teens, Loanio, Money, Personal Finance, Teens and Money | No Comments »
Thursday, March 11th, 2010
D.R.I.P.s
In times of uncertain economic future, it is important to look at your investment strategy and tweak it as needed. One of the ways that you can improve your portfolio is to take on small investments with lower risks associated with them. Taking in smaller rewards and returns may seem like a waste, but these smaller ROIs can actually add up fast in the right investment vehicles. Fixed income investments are some of the best small investments that are available to you, like savings accounts and CDs. Another excellent investment vehicle for someone looking for small investments with great rewards is an investment called DRIPs.
DRIPs are a truly cost effective way to raise equity for a company, and they are beneficial for investors as well. The reason why they are beneficial for investors is because they allow for the investment return drawn from dividends to be invested immediately back into the investment for price appreciation and compounding, but without incurring any brokerage fees. Additionally, there is no waiting for the investor to accumulate enough cash for a full share of the stock, which is another excellent advantage making these some of the best small investments that you can make.
DRIPs have numerous advantages associated with them, but they’re not perfect. They do allow investors to take advantage of dollar cost averaging for cost effectively investing the dividend income that is being paid out by the company. Not only will the investor receive a guarantee for the return on the dividend yield, but they will also earn whatever has been appreciated by the stock during the time that they own it. Another advantage is the fact that you do not need an exorbitant amount of money to begin. You can participate in such a program without more than a single share of stock, but it would be wise to consult your broker or the company’s investor section of their website to get more details on this.
DRIPs also allow you to grow your investment capital in a cost effective way by purchasing more company shares rather than simply spending money or having it sit idly in another account. Most company-offered DRIP investment programs have no fees for transactions, brokerage fees or account-keeping fees so 100% of your returns are being invested back in.
Some of the disadvantages of DRIPs include the administrative hassle associated with the cost basis of all the different small stock purchases, maintaining records of these purchases, and the fact that you do not get to choose the timing for when the stock is purchased. Most DRIPs have specific schedules that they are meant to follow, so there’s a little bit of uncertainty built in to this particular investment vehicle.
Still, if you are looking for one of the best small investments that you can make, these DRIPs are a good way to go if you can find a suitable program to buy into. They are worth checking out if you are trying to build your investment portfolio and are looking for something new, and profitable for that matter.
Photo Credits: 1
Originally posted 2008-11-11 05:57:21. Republished by Blog Post Promoter
Related Articles -
3 Types of Safe Investments /caption] Given the shaky financial markets across the world today and the extreme ups and downs that are being seen from one day to the next in the US market, you might be wondering what are safe investments, and how can I be sure I won't lose all the money...... -
The Best Small Investments /caption] Wall Street's recent cataclysmic events are still unfolding and the entire planet is feeling their aftershocks. For this reason, interest in what is going on in the stock market is rising quickly, even for those who do not normally understand what the stock market is all about, or what...... - Child Savings and Investment /caption] Having children is not cheap by any means these days, especially when you consider the long term basis. The older your children get, the more they will end up costing you, especially when you consider education costs which are rising with every passing year. It may seem easy to......
-
Traditional Magazines vs. Online Magazines /caption] While many people subscribe to a variety of financially-oriented magazines to keep abreast of the latest economic happenings, others find that online finance magazines are a great way to stay up-to-date on the latest financial news, all with just a click of the mouse. Online finance magazines have advantages...... -
What Are Legitimate High Yield Investments? In this day and age, everyone is hurting for money, and locating legitimate high yield investments is not easy. Aside from scams, another consideration that needs to be made is the potential return on any investments that you make. Despite the fact that there are many attractive investment opportunities available......
Related Sites - What Matters In Investing The financial media has a vested interest in making investing appear more complicated than it really is (this blog included, I suppose). The thing is, investing isn't complicated. If you can add 2 + 2 and are literate, you can invest your own money effectively. The Oblivious Investor (check him......
-
Beginner's Tips for Smart Investing Investing is an endeavor that can be both challenging and complicated. If you are new to investing, then you may end up paying the price if you do not know where to turn for the most reliable investing tips and investing advice out there. Fortunately for you and other beginners...... -
How to Invest Now Without a Dime in the Bank If you've ever had a chance to invest in a great stock but didn't have enough money put aside to take advantage of the opportunity, you know too well the agony of defeat. Most of us are under the impression that it takes money in the bank to start investing....... -
40th Money Hacks Carnival Welcome to the 40th Money Hacks Carnival and my first ever hosting of a blogging carnival. It's a privilege to host this event and have the option of cherry picking the best articles. Choosing just 5 top picks was not an easy task considering the line up of authors, the...... -
the reform in retirement accounts that's not coming If you want me to get started on a rant about personal finance, ask me about retirement accounts. From the "no-taxation" benefit of Roth accounts (yeah, the government will never touch those) to the "benefit" of 401(k)s (no better benefit than having your retirement savings steered into a narrow......
Tags: amount of money, brokerage fees, dividend income, dividend yield, dividends, fixed income investments, investment return, investment strategy, investment vehicle, investment vehicles, investor section, investors, price appreciation, rewards, rois, savings accounts, stock
Posted in Investments, Money, Personal Finance | No Comments »
Sunday, March 7th, 2010
Stockpiling can adversely affect prices.
As Hurricane Ike took aim for the Gulf Coast, the financial markets reacted much in the way that they were expected to. Gas prices jumped to $5 a gallon along the gulf coast, and many expected the price jump to go nationwide, particularly if the hurricane caused damage to any offshore oil rigs. Since the industry in the area was still reeling from the effects of Hurricane Katrina, it comes as no shock that the worst case scenario was trotted out with the approach of Ike.
But, what does this mean for the average consumer? How badly will prices be affected by another adverse event? We’ve seen the economic damage caused by Hurricane Katrina, so we have some form of basis to go on as to what to expect, but that does not mean that panic is necessary. There are a few things the average household can do to shore up their own defenses against natural disasters, whether they hit right at home, or thousands of miles away.
Panic is an ugly thing, and as people raced to the pumps to fill up their tanks, it is apparent that fears over even higher gas prices are running rampant. It is important to stock up on necessities such as fuel, but going into a panic mode over it is certainly counterproductive. Preparation is very important but the key is remaining calm. Panic serves only to weaken economic situations, and by looking at the issues rationally, you can rise above this problem and come out on top.
If you have extra gas containers, there is nothing wrong with stocking up, but hording is not recommended. This serves only to impact the overall balance of supply versus demand and can actually make prices worse. Stocking up on other necessities is also a good idea, but again, within reason. There is no need to run and clean out the grocery store and give into that panic mentality.
Preparing for natural disasters should be done well before they strike, no matter where you live. By waiting until the last minute, consumers can end up overspending, only to find that there was no real reason for all of their upset. If you are in the path of a natural disaster, or your area is at risk, keeping a special disaster kit is the perfect response to this problem. Preparing ahead of time, while prices are low and panic is not present, will help consumers beat the common problems of panic-fueled prices.
In today’s society, there is definitely a raised awareness of how disasters, both manmade and natural can affect us all. Preparing is essential, there is no doubt about that. However, the key to getting ready is taking the time to stock up before disaster strikes, so that when it does, you have everything you need on hand. This will help you save money, reduce overall stress and keep you prepared for any eventuality, and without putting you through the paces of panic.
Photo Credits: 1
Originally posted 2008-11-07 05:10:16. Republished by Blog Post Promoter
Related Articles -
Loanio Roundup - Wall Street Crisis and the Resilient Dollar /caption] Welcome to the second edition of the Loanio Roundup. This edition focuses heavily on the national economy and peer-to-peer lending news. We hope you enjoy pursuing through the links below. Leave a comment and tell us what you think - we'd love to hear your views on the Wall...... -
Finding a Legitimate High Yield Investment Most people hear the words High Yield Investment Program, or the acronym HYIP, and many of them quiver. This is not completely unnatural, because high yield investments only come with high risks, and most HYIP opportunities are not even legitimate to begin with. There are simply too many people out...... - 8 Tips for College Student Budgets [/caption] Below are eight tips for college students about money and finances. 1. Track your Expenses If you track your spending for a few weeks, you will be better able to figure out where your money is going. Are you spending an exorbitant amount of money on Starbucks? You may......
-
How to Put Together an Emergency Fund [/caption] If you are concerned about the state of your finances, your job or if you would just like to have a safety net that will be there to catch you if something goes wrong, an emergency fund is a very powerful tool to have in your financial arsenal. Emergency...... -
Stocks are a Great Investment /caption] Most people recognize that stocks are an excellent investment, but purchasing stocks can be a confusing process. This is especially true if you have little experience in investing, or no experience at all. You can turn the stock buying process into a good investment even as a beginner, and......
Related Sites -
what my grandparents taught me about money Most of my relatives have divergent ideas about money and its place in our lives. By relatives Iâm including the wide range from my wife to my parents to my in-laws, etc. I realized a long time ago that it is a trivial undertaking to pick out the flaws...... -
401k is losing money - crash and burn I don't check my 401k balance often at all. I prefer not to stress about it and just let it grow. I'm investing for for the long haul and know that overtime my money will grow at a 10-15% increase. I do check it though. Mostly to see if...... - Sunday Money Roundup - First Snow Edition. Yep, we have snow. Not in our yard, mind you - but up in the mountains surrounding my little town. It is still in the 70's during the day but at night it is in the low 30's already. Looking forward to seeing what my first winter in 13 years......
-
Save Money on Groceries [/caption] Though prices have come down as the economy has slowed, there's not much doubt that food is much more expensive today that it was in the past. It seems way out of line with inflation. Experts have cited many factors for this. Some say a change of eating habits...... -
Staying Solvent in Bad Economic Times Every day, the news about the economy seems to be getting worse and people across the world are concerned that they will be personally affected by the changes. In many cases, they already are when you consider how the cost of living has gone up, gas prices that seem to......
Tags: economic damage, economic situations, fears, financial markets, gas containers, gas prices, grocery store, gulf coast, household, hurricane, mentality, natural disasters, necessities, offshore oil rigs, panic mode, pumps, shock, tanks, worst case scenario
Posted in Money Saving Tips, Personal Finance, Smart Money Ideas | No Comments »
Saturday, March 6th, 2010
#4 Pace Yourself
Below are eight tips for college students about money and finances.
1. Track your Expenses
If you track your spending for a few weeks, you will be better able to figure out where your money is going. Are you spending an exorbitant amount of money on Starbucks? You may want to cut back. Most college students do not realize where their money is going until they really take the time to pay attention to their receipts at the end of the week.
2. Formulate a Plan
The best way to manage your finances over the course of a semester is simply to sit down and really take the time to map out a budget. List all of your sources of income, tracking potential income and actual income earned. Then list all of your expenses, including tuition, books, groceries, and so on. When you have a plan formulated, you can better track money coming in and going out.
3. Make Room for Good Time Money
You need to make plans to have a little bit of personal spending money for entertainment purposes, eating out or other special purchases, otherwise you can easily throw your entire budget plan out of whack. Make some room for entertainment money and just vow to stay within your budget from month to month.
4. Pace Yourself
If you spend too much money at the beginning of the semester you will run out of money before the end. Give yourself a weekly spending limit based on how much income you have, and stick to it so you don’t end up tapped out by the end of the semester.
5. Go Easy on Credit
Credit cards are nice, and useful, but only for some purchases and not all. One quick way to spend way beyond your means is to use credit in the wrong ways. Use your credit cards sparingly if you have them, otherwise you may end up hooked on charging things, which is a great way to rack up unavoidable, unnecessary debt.
6. Set a Personal Credit Line
Just because your credit card has a limit of $2,000, that does not mean you have to spend that much. Only spend what you can actually pay back. If you only have $500 to attribute to paying back a credit card, only spend that much on the card and you will be fine.
7. Be Realistic
You can do what you want to do, but you cannot necessarily do everything that you want to do. Make some choices and be prepared to make some sacrifices because doing things and buying things is going to make a dent in your wallet, but some expenses can be easier on the wallet than others and provide just as much return on investment.
8. Plan Ahead for Emergencies
If you bust your entire budget this week on something you want to do, make sure to make up for it next week. If you constantly spend your entire budget frivolously, you can end up unprepared for emergencies like auto maintenance costs, course materials, health costs and so on.
Photo Credits: 1
Originally posted 2008-11-06 05:11:31. Republished by Blog Post Promoter
Related Articles - Do You Avoid Personal Budget Planning? /caption] One of the things that can make your life easier, even though it sounds complicated, is personal budget planning. If you're one of the fortunate few who never has to worry about running out of money no matter how many extra expenses might crop up or how much extra......
-
When Disaster Strikes [/caption] As Hurricane Ike took aim for the Gulf Coast, the financial markets reacted much in the way that they were expected to. Gas prices jumped to $5 a gallon along the gulf coast, and many expected the price jump to go nationwide, particularly if the hurricane caused damage to...... -
Prepare for Your Retirement Now /caption] If you are young and just beginning a career, then the concept of retirement planning may seem so far away that it is the last thing that you put any consideration into. However if you are on the opposite end of the fence and retirement is just around the...... -
3 Tips for Teen Investing Parents like to complain that their teenage children do not listen to them. However, when it comes to matters dealing with money, the opposite is actually often true. Teenagers often welcome the advice that their parents have to give regarding finances, money management and investments. In the past few years,...... -
Defining Your Budget and Crafting Your Financial Future A budget or spending plan is a specific money management tool that is designed to put you in control of your spending, keeping you out of credit trouble and other financial trouble. Your budget is vital because it is your personal plan for spending the income that you have, making......
Related Sites -
The Basics of Personal Finance are Not Hard It Doesn't Matter if you Make $46,000 or $460,000 Every single day at work, I discuss multimillion dollar estates.  Every day I get to work with balance sheets with numbers I can only dream aboutâ¦hell with numbers anyone can dream about. Just today, I saw a balance sheet with approximately $21,000,000, and it was only $21,000,000 because he didnât want it written down...... -
9 Excuses Why You Haven't Started A Budget Yet I was thinking about why more people and families don't have a budget. It's really the thing to do to keep track of your expenses and income and make sure you don't go over with your spending. I thought about all the different excuses I've heard and seen from...... -
Top 14 Personal Finance Tools This is a guest post by Fred Schebesta who writes about saving money at Savings Account Finder. There he helps people compare and choose the right savings account to get more interest. Managing your finances can take a lot of time to be done right, however you financial security...... -
Recession Not Through With Us Yet While it may seem that the nation's economy is taking a turn for the better and strides toward the positive are being made, the recession times we have been experiencing are not exactly over. With so many people starting to regain confidence in their personal finances again with just the...... -
Personal Finance Credit Crunch Budgets are unfortunately quite the necessary evil when it comes to managing your own personal credit crunch. Everyone is going through a credit crunch, even those who have relatively healthy credit. The only practical way to keep yourself financially stable in this volatile market is to get a grip on......
Tags: amount of money, budget plan, college students, credit card, credit credit cards, entertainment purposes, good time, groceries, little bit, much money, pace, personal credit line, receipts, spending money, starbucks, time money, vow
Posted in College Student Finances, Credit, Emergency Fund, Managing Money Wisely, Money, Personal Budget Planning, Personal Finance, Smart Money Ideas | No Comments »
Friday, March 5th, 2010
Most people have questions when it comes to 401k planning and retirement. These people often wonder what 401k planning is, how 401k planning works, and how a dwindling balance can be revived. 401k plans can be complex, but they can also be quite easy to understand with a little bit of preparation.
What is 401k Planning?
A 401k is a retirement plan sponsored by an employer. Employees can contribute some of their income to their plan before taxes. The maximum amount of the contribution can be limited by the plan or by the federal government. Once the employee goes into retirement, their distribution is going to depend on how much the plan has grown over time. Because of this, employees should choose their investment choices carefully. Once they begin to take distributions, the withdrawals will be taxed. If the money is withdrawn before the employee reaches the age of 59 and a half, then there will be a withdrawal penalty.
Plan for your retirement.
How does 401k Planning Work?
If a company does offer a 401k retirement plan, then the employee usually has some option to select their investment funds based on a list provided by the 401k planning company. The employee’s contribution is going to be deducted automatically from the employee’s paycheck before taxes are taken out. Each employee is allowed to contribute up to a certain percentage, and some employers will match this percentage. The contributions that are made along with matching funds are invested into the employee’s funds. Sometimes loans can be drawn out of 401k plans, and some hardship withdrawals are also permitted. There is also a vesting period where an employee must be employed for a defined number of years before the money in their account is actually their own.
How is a declining balance repaired in 401k planning?
The first thing that you should do in order to address a declining balance is to look more closely at the investment mix that you are working with. If you invest too heavily in company stock, this can cause significant problems if the company ever faces financial troubles. Contributions should be adjusted in order to make the most out of contribution limitations, and the maximum tax deferred contribution should be made whenever possible. At the very least when this is not possible, employees should contribute enough to gain matching funds from the company.
How can a 401k portfolio be best balanced?
Balancing your 401k planning portfolio is important because it shows you whether or not your investments are on track with your game plan for retirement. If you are wondering whether or not you need to rebalance, it may be time to consider your goals, your risk tolerance and any other concerns that you have alongside a financial advisor. Some of the things that will dictate the next steps in your 401k planning process include age and how close you are to retirement. Your 401k planning process will involve investments for growth and investments for income.
Photo Credits: 1
Originally posted 2008-11-05 05:09:37. Republished by Blog Post Promoter
Related Articles -
How Do I Plan For Retirement Every working man and woman is entitled to a retirement that is secure and comfortable. Saving and planning for retirement is not necessarily an easy process however because we are living longer and healthier lives in general, which means we need more money to survive retirement than ever before. If...... -
Setting Goals for Good Personal Finance /caption] Setting goals is an important part of your personal finance plan. Goals can be divided into four unique categories that are relatively general in nature. These categories are short term goals, intermediate term goals, long term goals and life goals. Short Term Personal Finance Goals - These short term...... - Do You Avoid Personal Budget Planning? /caption] One of the things that can make your life easier, even though it sounds complicated, is personal budget planning. If you're one of the fortunate few who never has to worry about running out of money no matter how many extra expenses might crop up or how much extra......
-
Child Savings and Investment /caption] Having children is not a cheap proposition these days, especially when you consider long term costs. The older your children become, the more they are going to end up costing in the long run. High education prices, for example, continue to soar making it nearly impossible for you to...... -
Breaking Down Budgeting A personal budget is simply a spending plan. Before you work on personal budget planning you need to have a good idea of where and how your money is being spent. It can be a tedious process, but it can also be a true eye opener if you are not......
Related Sites -
My 401(k) Is Killing Me, I'll Never Retire! It's getting towards the end of the year so I logged into my 401(k) account at Fidelity to see how it's doing. It's not good. My return for the year is real low. Like, I could make more in an ING account low. Will I ever be able to retire?...... - Our Early Retirement Plan: Motivation, Numbers & Tools, and Conclusion (Part 5) If you are just starting this, I suggest you start at The Introduction - Part 0. Alternatively, you can jump to Our Early Retirement Plan: Where We Are Now (Part 1), Our Early Retirement Plan: My Personal Income (Part 2), Our Early Retirement Plan: My Wifeâs Plan (Part 3), or......
- Making Your Maximum Annual IRA Contribution at Tax Time RateLadder made a guest post on LazyMan's blog on a strategy he is using to fund his Simplified Employee Pension Plan (SEP-IRA). A SEP-IRA is a retirement plan for individuals that are self-employed, and thus do not have an employer sponsored plan (such as a 401k or 403b). Basically, he......
-
Dear Washington: My Retirement Plan Wish List For a few brief months every four years, Washington pretends to actually care what the rest of the nation thinks. That magical, mystical time is commonly referred to as "election year". In case you've been living under a rock, prospective presidential candidates have been promising voters anything and everything under...... -
The next big thing Photo of Taipei 101 by umm The following is a guest post by Becky at Family and Finances, a blog about finances and saving money. If you like this post, consider subscribing to her feed via RSS. Remember the tech stock boom and, later, the bust? Doesn't it bear......
Tags: 401k retirement plan, company stock, distributions, federal government, hardship withdrawals, investment choices, investment funds, investment mix, little bit, loans, matching funds, Money, paycheck, planning company, vesting period, withdrawal penalty
Posted in 401K Retirement, Loanio, Money, Personal Finance, Plan for Retirement | No Comments »
Wednesday, March 3rd, 2010
Managing your money wisely in 4 steps.
One of the hardest things for many people to accomplish is managing money wisely. We may all know the basics, and understand that spending too much is a good way to get on the road to financial ruin. However, when push comes to shove, we end up making mistakes that may take years to undo. If you’re serious about managing money wisely, there are a few tips that you can implement today that will help you reduce the mistakes you make and help you take better advantage of your successes.
1. Always weigh the consequences.
Impulse buying that cannot be controlled is a sure recipe for disaster. If you are trying to start managing money wisely, the first step to take is to make sure that you weigh the consequences before making any purchase, big or small. When you start to consider the consequences of a frivolous purchase, resisting the urge to buy it will be a lot easier. For example, let’s say that you have had your eye on an LCD television that costs $6000. Once you spend that money, it’s gone, since your television will never earn any more for you. What could you do if you invested that $6000 instead?
2. Set yourself up for success.
Many people fail at managing money wisely simply because they make it too hard to succeed. Whether it is a strict budget that can’t possibly be kept, or constant spending that can’t be controlled, if you are not setting yourself up for success, you may have a hard time getting there, especially at first. Try setting a budget that you can easily keep. Once you have this down and you’ve gotten into a routine you can start saving more money. By making changes gradually, you can ease into managing your money more effectively and it will be easier to get there.
3. Set goals.
Setting financial goals is a vital component of managing money wisely. When you are working towards something, sticking to a budget or waiting to make a big purchase are a lot easier. Try to set financial goals for this year, five years and then further into the future. Create milestones along the way of what you would like to achieve and then keep these goals in a prominent place. They will help you stay focused and motivated to keep managing money wisely.
4. Pick yourself back up if you fall.
We’re not perfect and even the best of us do make money mistakes from time to time. The key is getting right back up and trying again. Anyone can keep a budget, and anyone can learn to create more opportunities for income. The key is staying motivated, and avoiding having discouragement keep you from managing money wisely.
These are four easy steps that you can start using right now in order to start managing money wisely. Don’t wait to formulate a plan for your financial future. The best time to start preparing for tomorrow is today.
Photo Credits: 1
Originally posted 2008-11-03 15:40:29. Republished by Blog Post Promoter
Related Articles -
Do You Need a Money Manager? /caption] If your idea of organizing your finances is throwing a receipt in a big pile, you may want to consider the benefits of hiring a money manager. There is a new trend in the financial world where daily money managers are becoming very popular, and for many consumers, they...... -
Personal Budget Planning /caption] Personal budget planning is an important part of keeping a handle on your finances. Because there is so much turmoil in today's economy, maintaining a healthy personal budget is more vital than ever. Crafting a personal budget begins with determining how money comes in, and how money goes out,...... -
Teach your Teens to Save Money Teaching your children how to manage their finances is absolutely critical if you want them to be successful at managing their money in the future. More than 80 percent of all parents are led to believe that their children are learning enough about personal finance and money management in school,...... -
Best Small Investments When you are looking to generate money through investing in the shortest amount of time, and you do not have a lot of money to begin with, then you are going to want to learn how to take small investments and turn them into big rewards. If you have a...... -
How Much Money Do You Really Spend? Overspending is an enormous problem for Americans right now and the sad truth is, many of us do not even know we are doing it. If you are finding it hard to make ends meet at the end of the month, or you are desperately waiting for that next paycheck......
Related Sites -
Money Management Questions and Answers How can money management techniques be applied to my life? - The first step is to realize that you could possibly have an overspending problem. This is the number one reason why people get over their head financially. You can easily consult with a money management counselor that will help...... -
Money Management and Budgeting are Vital for Avoiding Financial Disasters Anyone who is worried or stressed out about their finances right now has probably had concern over whether or not their budgeting and money management tactics are working. It is important that you learn how to develop good skills for money management in this day and age, otherwise you will...... -
Five Ways Fantasy Baseball is Like Personal Finance I had my draft for my fantasy baseball league I'm in earlier this week. I've been in the league with these particular guys now for over five years. It's not a money league but we're real competitive nonetheless. I gotta say I'm real excited! Not only is real baseball starting...... - ABC's UN-BROKE: Personal Finance For Dummies, or Useful Infotainment? Did you see UN-BROKE: What You Need To Know About Money On ABC Friday night? Starring Seth Green, Samuel L. Jackson and Christian Slater, the one-time special purports to help educate us (or those who don't know) about personal finance. We can call it the celebrification of personal finance. I......
-
Educate yourself on personal finance and money A survey done in 2006 by Entrepreneur magazine revealed that "70% of Americans say they are good or excellent at managing their finances." Did that statistic shock you? It did me. Statistics from a 2006 government survey show that "96% of all Americans will retire financially dependent on the......
Tags: consequences, disaster, financial goals, financial ruin, futu, hard time, impulse buying, lcd television, managing money, managing your money, resisting the urge, set goals, setting a budget, sticking to a budget, strict budget, successes, vital component
Posted in Managing Money Wisely, Money, Overspending, Personal Budget Planning, Personal Finance | No Comments »
Monday, March 1st, 2010
Help your teen build strong money management skills.
One of the best ways to build a strong financial foundation in teens is by starting a savings plan early on. Over the past few years, there have been more teens saving money and the results are clear. When you take the time to teach good financial practices to your children, these skills will carry them through life, helping them to build up a nest egg that they can rely on in the future. If you want to start your kids down this financial path, here are a few tips on how to get your teens saving money now.
1. Set up a reward system.
At first, before the benefits start to kick in, your child may need some extra incentive to start saving money. Try setting up either a reward once they reach a certain dollar amount, or you may even want to offer to match their savings, dollar by dollar. This is a great way to get your teens saving money and offers them some real incentive, as well as hard evidence, that saving is very beneficial. Even if you only add a few dollars to their account at a time, this extra money will help them get motivated and stay focused.
2. Start discussing sound financial principles with your child.
Once you’ve got your teens saving money, it’s a great time to start talking about setting financial goals, and working on the follow through. For example, you can ask your child to set a goal as to what they would like to be able to buy, that they cannot afford right now. This helps them see the value of the hard work they are putting in towards saving for that item and once again, will keep them motivated. However, it is important that they understand that spending all that they have saved up isn’t the best solution and that they should have long term goals, as well as short term goals.
3. Take them to the next level.
Once you have your teens saving money and they are learning more about goal setting, you can take their lessons to the next level by incorporating information about setting up more than one stream of income. Help them to set up a portfolio, use a p2p lending service like Loanio to lend money, or open a high yield savings account for them so that they can start to watch their money grow. This is also a good time to start talking about investments with your teen, even if they can’t quite make their own just yet.
4. Get them interested in continuing education.
One of the best ways to get your teens saving money is by teaching them how the stock market works and how they can add to their savings account easily. There are numerous online sites that will provide users with free example “money” that can be used to invest in theoretical stocks. This is a great training method that has no risk, but can be incredibly useful in teaching lessons about stocks. You may even want to take part in these yourself and set up a competition to see who can make the best theoretical picks.
Photo Credits: 1
Originally posted 2008-10-31 04:55:15. Republished by Blog Post Promoter
Related Articles -
Tips for Managing Your Money Wisely With a few tips for managing money wisely, you should have no problems putting together a good working budget and learning how to manage your money. Here are some excellent tips for managing money wisely that will give you a great platform for getting started. /caption] 1 - The first...... -
What Are the Best Small Investments? [/caption] In times of uncertain economic future, it is important to look at your investment strategy and tweak it as needed. One of the ways that you can improve your portfolio is to take on small investments with lower risks associated with them. Taking in smaller rewards and returns may...... - Managing Money Wisely [/caption] One of the hardest things for many people to accomplish is managing money wisely. We may all know the basics, and understand that spending too much is a good way to get on the road to financial ruin. However, when push comes to shove, we end up making mistakes......
-
4 Tips for College Students Budgets /caption] If you are a college student, then your primary focus is probably set on your studies and trying to maintain your education so that you will be benefited in the future. Unfortunately, one of the things that you may not be putting enough consideration into is how you are...... - How Do I Plan For Retirement Every working man and woman is entitled to a retirement that is secure and comfortable. Saving and planning for retirement is not necessarily an easy process however because we are living longer and healthier lives in general, which means we need more money to survive retirement than ever before. If......
Related Sites - It's easy -- but a lot of work Have you ever started a project, thinking to yourself that it'll be easy? "How hard can it be?" is pretty much a mantra of mine, so I start projects with that thought all the time. (I still don't understand why my husband always laughs!) But gradually I've come to learn......
-
Saving for Emergencies One of the basic principles of any sound financial plan is saving money for emergencies. Everyone will suffer a major financial windfall at sometime in their life, such as a job loss, automobile repair or a major medical bill. Itâs only logical to save for such events. As much as...... -
linklings, money writers edition I'll launch into the roundup by formally announcing (not that it's a surprise to most readers by this point, although some subscribers who don't visit the site may not have noticed) that I've joined The Money Writers network. The network has been around for a year and included The...... -
5 Ways to Save Money Without Even Trying The whole process of saving money is usually associated with pinching pennies until they scream for mercy, living on food from dented cans and basically giving up everything for a future goal. While this will indeed help you put more money away, saving does not need to mean hardship. We...... -
How to Survive Inflation Turn on the television, read a paper or go online and chances are you’ll be bombarded with bad news about the state of the economy. Inflation is being whispered about, and in some cases, shouted about from the rooftops. Are we really facing inflation and how bad will it get?......
Tags: best solution, extra money, financial foundation, financial goals, financial path, financial practices, financial principles, great time, hard evidence, high yield savings, long term goals, nest egg, next level, reward system, saving money, short term goals, Stock Market
Posted in Managing Money Wisely, Money, Personal Finance, Smart Money Ideas, Stock Market, Teens Saving Money, Teens and Money | No Comments »
Sunday, February 28th, 2010
Is online banking for you?
Online banking has become incredibly popular and it is very useful. For those that rely on online banking, there is an accepted risk that goes with exposing your financial information online, but before you jump in, it is a good idea to do a little checking to make sure that your online bank is indeed safe for your to use. Don’t wait to find out until your accounts are cleared out. By running your online bank through this checklist, you should be able to decide whether or not their online portal is what you should be using.
First, it is necessary to make sure that your log in page and your account page are hidden behind a secure certificate. These are known as SSL certificates and they provide encryption that will block hackers from attaching your funds by getting your log in information. In addition to this precaution, if you are using an online bank it is very important to run your own firewall and antivirus protection software.
A good hacker can place a keylogging program on your computer, and you’ll be practically giving them your log in information without even realizing it. Keep all of your passwords off of your computer and store them in a safe place. Make note of your log in urls as well to ensure that if something does happen, you can quickly take care of the issue.
It is also a good idea to read through the terms of service and privacy policy for any online banking site. These agreements contain very important information and even though they are about as interesting as dried toast, you need to take the time to carefully read it to see how they will be handling and securing your data. If you don’t understand anything, don’t be afraid to ask the bank for clarification.
You should also take the time to test out an online account before you transfer a large amount of money into it. Give it a few weeks to see how the dust settles and whether or not you will feel safe putting your money in that institution. By depositing only a small amount of money at first, you are minimizing your overall risk and getting a better idea of how the bank operates day to day.
If at any time you question the security of your online bank account, report it immediately. Most banks do offer fraud protection now, but in many cases, you’ll be the one that catches it. Always review your statements carefully to see if any unauthorized access has been gained.
By taking a few simple steps early on you can easily set up an online bank account that will be useful and easy to understand. Never rush in with an online bank and take the time to run them through the better business bureau before you proceed. The time you spend on due diligence now will definitely come in handy should anything go wrong.
Photo Credits: 1
Originally posted 2008-10-30 04:55:35. Republished by Blog Post Promoter
Related Articles - Save Money with These 4 Tips /caption] There are ways that you can save money, and all you need to do is learn about managing money wisely to do it. You are not necessarily being frugal, per say, but rather you are learning how to be wise in the decisions that you make. Unfortunately, most people......
-
Searching for a Legitimate High Yield Investment? /caption] If you're just getting started with investing, you're probably searching high and low for a legitimate high yield investment to sink some money into and make lots of profits. Everyone wants to find those high yield investments so they can do the same thing. The biggest problem, of course,...... -
Teach Your Teen About Saving Money One of the biggest reasons why having a teenage child can be difficult is because teenagers tend to spend money easily and freely without any real regard for what goes into earning that money in the first place. Teenagers tend to spend a great deal of money on clothes, shoes,...... -
Teens Saving Money [/caption] One of the best ways to build a strong financial foundation in teens is by starting a savings plan early on. Over the past few years, there have been more teens saving money and the results are clear. When you take the time to teach good financial practices to...... -
Teach Teens to Save Money /caption] One of the biggest reasons why having a teenage child can be difficult is because teenagers tend to spend money easily and freely without any real regard for what goes into earning that money in the first place. Teenagers tend to spend a great deal of money on clothes,......
Related Sites - Online banking made easy If you have access to a computer and are familiar with how to view a web page, online banking can be a snap. It's usually a fairly simple process to sign up. If you have an existing bank account, you can talk with a banker about setting up online access,......
- Leaving My Bank - Comparing Online Bank Accounts. Elisa Cundiff is the guest blogger today, she is the Outreach Coordinator at Thrive, a free online budgeting tool. Every morning I review all my financial accounts on Thrive, but last Thursday, I noticed something strange: a â$3 non-Citi atm feeâ. This was an additional $3 that my bank was......
- Are online banks safe? Online banks frequently pay much higher interest rates than other banks, which is probably where some of the concern comes from. After all, we've all heard the phrase "if it sounds too good to be true, it probably is". But 4-5% interest is not "too good to be true". To......
-
How to Stay Focused With Multiple Streams of Income One of the main problems facing those that have multiple streams of income is managing them. You can start to feel a bit like a juggler and chances are, you may be neglecting areas that could be performing better and making more money. Focusing can be tough, but there are...... - Reviewing this Week’s Hard Truth about Money and Personal Finance Wall Street Pushes Hurricane Ike to the Second Page This week has no doubt been a record-beater in the volume of money and finance news that has pushed its way to the front pages of print and electronic news publications. The people still struggling with Hurricane Ike have been pushed......
Tags: amount of money, antivirus, clarification, encryption, financial information, firewall, hacker, hackers, important information, online bank account, Online Banking, passwords, precaution, privacy policy, protection software, risk, safe place, securing your data, ssl certificates, urls
Posted in Money, Online Banking, Personal Finance | No Comments »
