Personal Finance News Wednesday 10/31

Phil's Personal Finance Tip of the Day:

401(k) and IRA Changes Coming in 2013

By Emily Brandon | U.S.News & World Report LP – Tue, Oct 30, 2012 10:48 AM EDT

Workers will be able to defer taxes on an additional $500 in their 401(k) and IRA plans in 2013. Retirement accounts will also be tweaked in a few other important ways. Here's a look at the retirement account changes you can expect to see next year.

Larger 401(k) contribution limit. The contribution limit for 401(k) plans, 403(b) plans, and the federal government's Thrift Savings Plan will increase from $17,000 in 2012 to $17,500 in 2013.

However, the catch-up contribution limit for employees age 50 and older will remain unchanged at $5,500. "One of the best ways to take advantage of the increased limits is to perform a year-end checkup of your 401(k) and make sure that you are contributing the maximum allowable by law," says Garth Scrivner, a certified financial planner and senior investment counselor for
StanCorp Investment Advisers in Albuquerque, N.M.

"One strategy to avoid the pain of increased savings is to consider giving your 401(k) contribution a raise at the same time your annual pay raise occurs."

[Read: 10 Things You Should Know About Your 401(k) Plan.]

Higher IRA contribution limit. The IRA contribution limit for workers who meet the income requirements will increase from $5,000 in 2012 to $5,500 in 2013. The catch-up contribution limit for older workers is still $1,000, which is unchanged from 2012. "The enhanced limits have the additional benefit of increasing current tax deductions (assuming pre-tax salary deferrals) or increasing the amount of client's tax-free investments (assuming Roth salary deferrals)," says Matthew Davis, a certified financial planner for Davis Financial Management in Leawood, Kan.

New 401(k) fee information. Next year is the first full year that 401(k) participants will receive quarterly and annual 401(k) statements listing the fees charged to their accounts and showing returns compared to a benchmark, due to new Labor Department regulations that went into effect in 2012. "Next year, the biggest changes will be a continuation of the new disclosure rules regarding fees that are just hitting participant statements now," says Rick Meigs, president of 401khelpcenter.com. "You are going to get an annual notice and you are going to start seeing more disclosure of fees and costs on your quarterly statements." These statements can be used to evaluate whether the funds you are investing in are worth the fees you are paying.

To read the entire article from Emily Brandon | U.S.News & World Report LP:
http://finance.yahoo.com/news/401-k-ira-changes-coming-141817664.html

Inspirational Quotes@Inspire_Us from Twitter:
I dream of painting and then I paint my dream. - Vincent Van Gogh

Personal Finance News Tuesday 10/30

Phil's Personal Finance Tip of the Day:

Does Excessive Halloween Spending Haunt You?

from daveramsey.com on 12 Oct 2012

Halloween approaches.

Look outside and you’ll likely see pumpkins lined on doorsteps, ghosts and goblins hanging from trees, and orange lights draped across door frames.

Across the country, people are planning elaborate costumes for themselves and their kids. Retailers have stocked aisles full of chocolate and other sugary snacks.

We love Halloween.

Problem is—maybe we love it a little too much. Americans spent somewhere in the neighborhood of $6.8 billion—that’s “billion” with a “b”—on Halloween last year, making it one of the most profitable holidays for retailers.

If we actually gave gifts at Halloween—instead of decorating our houses and ourselves—the holiday would probably be second only to Christmas in retail sales. That’s some serious spending, folks!

So, with Christmas right around the corner, you need to determine (now!) if it makes sense for you to spend your cash on Halloween. That’s what opportunity cost is all about. The money you spend on
Halloween can’t be used for Christmas.

The blow-up ghost hanging from the tree and the Cher costume may seem like great ideas now, but that costume will be stuffed in the back of the closet come December.

To read the entire article from Dave Ramsey.com:
http://www.daveramsey.com/article/does-excessive-halloween-spending-haunt-you/lifeandmoney_budgeting/text2/

Scripture of the Day from Dave Ramsey.com:

Proverbs 11:25 – A generous person will prosper; whoever refreshes others will be refreshed.

Please listen to the Dave Ramsey show live on WOR 710 from 2-4 PM EST. You can also listen to the 3rd hour 4-5 PM EST. at Dave Ramsey.com.

Personal Finance News Monday 10/29

Phil's Personal Finance Tip of the Day:

Credit History Botched? Here's How To Complain And Get Results

By John Wasik | Forbes – Thu, Oct 25, 2012 11:08 AM EDT

Got a beef about a credit reporting company? Trying to get a credit file corrected? Until recently, you were left to the mercy of individual credit reporting bureaus. Now, you can approach and file a complaint with a watchdog agency in the guise of the Consumer Financial Protection Bureau (CFPB) to obtain satisfaction.

The stakes are high if you need credit; it's important that your credit report reflects accurate information. It's sent to creditors and loan rates are based on information from your file. You could be paying too much in finance charges based on faulty reporting. So now's the time to fix the bad information.

More On Forbes: Ten Top Credit Card Choices From College To Retirement

"The largest credit reporting companies issue more than 3 billion consumer reports a year and maintain files on more than 200 million Americans," the CFPB reports. "The consequences of errors in a consumer report can be catastrophic for a consumer, shutting him or her out of credit markets, jeopardizing employment prospects, or significantly increasing the cost of housing."

Here's how to go about fixing your credit record:

To find out how and to read the entire article from John Wasik | Forbes:
http://finance.yahoo.com/news/credit-history-botched-heres-complain-203920585.html

Inspirational Quotes@Inspire_Us from Twitter:
I always like to look on the optimistic side of life, but I am realistic enough to know that life is a complex matter. - Walt Disney

Personal Finance News Saturday 10/27

Phil's Personal Finance Tip of the Day:

Accomplishing the (seemingly) impossible
By Harvey Mackay

A college student arrived a few minutes late for his final exam in mathematics. The room was quiet, with everyone working hard, and the professor silently handed him the test. It consisted of five math problems on the first page and two on the second. The student sat down and began to work. He solved the first five problems in half the time, but the two on the second page were tougher. Everyone else finished the exam and left, so the student was alone by the end of the time period. He finished the final problem at the last second.

The next day he got a phone call in his dorm room from the professor. “I don’t believe it! You solved the final two problems?”

“Uh, yeah,” the student said. “What’s the big deal?”

“Those were brain teasers,” the prof explained. “I announced before the exam that they wouldn’t count toward your final grade, but you missed that because you were late. But hardly anyone solves those problems in so short a time! You must be a genius!”

“Genius” is sometimes just not realizing that something is impossible.

Truly, some feats are impossible. I don’t expect to ever see a person fly without some mechanical help. I’m not betting on anyone outrunning a high-speed locomotive. But then, I probably wouldn’t have put money on Antonio Albertondo, who swam the English Channel in 1961.

The Channel waters are cold and unpredictable. Only a tiny percentage of those who have attempted to swim across have reached the other side. But Antonio, who was 42 years old at the time, swam from England to France, where his waiting friends congratulated him for accomplishing what they thought was impossible for a man his age.

Antonio stopped long enough for a hot drink, and told his friends they hadn’t seen the impossible yet. Then he dove back into the water, swam 22 more hours and made it back to England. Did he accomplish the impossible? I vote yes.

To read the entire article from Harvey Mackay:
http://www.harveymackay.com/accomplishing-the-seemingly-impossible/

Mackay’s Moral: What could you accomplish if no one told you it was impossible?

Personal Finance News Friday 10/26

Phil's Personal Finance Tip of the Day:

7 ways to snag the best airline seat

By Kelli B. Grant/MarketWatch

Flying isn’t getting any cheaper, and travelers who don’t book carefully may find that they’re paying more for a less comfortable experience.

Airlines have been adjusting their cabin configurations in recent months to fit more passengers, often resulting in a tighter squeeze for those in coach.

Earlier this month, JetBlue announced it had expanded legroom in new premium rows on some Embraer E190 aircraft—at the expense of an inch lost in the rearmost 11 rows. In January, Southwest began adding six seats to each plane, a change that also reduced legroom by an inch.

Industrywide, the average seat offers 31 inches of legroom, down from 32 inches just a few years ago, says Rick Seaney, chief executive of fare-tracking site FareCompare.com. “There’s no doubt: If you’re tall, you’re paying more and you’re feeling less comfortable for it,” he says.

But comfort may be compromised by more than just reduced legroom, says Jami Counter, a senior director for seat-rating site SeatGuru.com.

Airlines have also been replacing seats with thinner, lighter models. (Earlier this week, United announced it would use such seats to add an extra row of seats to planes next year, saying the thinner design wouldn’t reduce legroom.) Some of the new seats aren’t as comfortably padded as others.

“There are some that are incredibly thin—not quite like a mesh office chair, but you’re getting pretty close to that,” he says.

If there’s good news for travelers, it’s that the changes will be slow to appear. Most of the changes are coming in with new aircraft over the course of a few years, says George Hobica, founder of AirfareWatchdog.com.

Reconfiguring existing planes takes time, too, since it’s not simply a matter of adding a row of seats—airlines must also add extra oxygen masks, lights and air vents. “It’s not something they could do overnight,” he says.

Even as airlines play musical chairs, experts say there are plenty of things travelers can do to end up in a great seat by takeoff:

To read the entire article by Kelli B. Grant/MarketWatch:
http://www.marketwatch.com/story/7-ways-to-snag-the-best-airline-seat-2012-08-23

Inspirational Quotes@Inspire_Us from Twitter:
Nothing great in the world has ever been accomplished without passion. - Georg Wilhelm Friedrich Hegel

Personal Finance News Thursday 10/25

Phil's Personal Finance Tip of the Day:

5 Annoying Bank Fees to Avoid

Charges are piling up on formerly free checking accounts.

By The Kiplinger Washington Editors

From Kiplinger's Personal Finance magazine, July 2012

Bank fees are multiplying like mosquitoes in summer. Mike Moebs, of Moebs Services, which tracks bank data, says his database includes more than 300 charges for loans and deposits. And many banks are dodgy about their fees, according to a survey by U.S. PIRG, the federation of state public interest research groups.

Many customers, especially at big banks, are getting stung by fees for formerly free checking accounts. At Chase and Citibank, for example, if your account dips below the $1,500 minimum daily balance, you’ll pay a monthly fee of $10 or $12. You can deflect the fee if you arrange for monthly direct deposit, pay a certain number of bills online and avoid paper statements. But you don’t have to jump through hoops if you move your checking account to a fee-friendly community bank or credit union. Find a community bank near you or a credit union at www.culookup.com or www.asmarterchoice.org (see 7 Great Credit Unions Anyone Can Join).

Read more: http://www.kiplinger.com/magazine/archives/5-bank-fees-to-avoid.html#ixzz2AKjQh6R3

Become a Fan of Kiplinger's on Facebook

Read more at http://www.kiplinger.com/magazine/archives/5-bank-fees-to-avoid.html#vGIiLrvLSGaozA1j.99

Inspirational Quotes@Inspire_Us from Twitter:
Be not afraid of going slowly, be afraid only of standing still. -Chinese Proverbs

Personal Finance News Wednesday 10/24

Phil's Personal Finance Tip of the Day:

Best Lodging for Less Than $70 Per Night

By Farnoosh Torabi | Yahoo! Finance – Mon, Oct 22, 2012 11:45 AM EDT

Whether you’re looking for a traditional hotel experience or a more adventurous solution, we’ve got your shoestring travel needs covered. I recently spoke with Budget Travel magazine for their top lodging picks for less than $70 per night.

Budget Hotels
When it comes to hotel chains, prices vary by season but especially by destination. You’d be hard pressed to find a $70 hotel room in any major metropolitan area. But in smaller cities like Montgomery, Alabama; Albany, New York or other places where there’s a surplus of hotel rooms – like Atlantic City or Las Vegas – the $70 or even $60 hotel room does exist at popular budget hotel chains.

“My to favorite budget hotel chains are Sleep Inn and Best Western because they’re incredibly clean,” says Laura Michonski, executive digital editor of Budget Travel. “They’ve both invested an enormous amount of money in renovating their properties, and they’re pretty ubiquitous.”

To read the entire article from Farnoosh Torabi | Yahoo! Finance:
http://finance.yahoo.com/news/best-lodging-for-less-than--70-per-night.html

Inspirational Quotes@Inspire_Us from Twitter:
When anger rises, think of the consequences. - Confucius

Personal Finance News Tuesday 10/23

Phil's Personal Finance Tip of the Day:

6 Things You Should Know About People With Stellar Credit Scores
By Mandi Woodruff | Business Insider – Mon, Oct 22, 2012 1:08 PM EDT

With the average FICO credit score estimated at 690 (the highest possible score is 850), chances are most Americans wouldn't mind some advice on how to improve.

Of all consumers, just 25 percent have managed to achieve a score of 785 or higher.
Why not ask them how they've done it?

A new report by myFICO analyzes the habits of the country's savviest debtors to find out just how they've achieved a stellar FICO score.

[Click here to check current credit card offers, including rates and terms.]

Here's what they found:

1. They're not debt-free. On average, they carry an arsenal of about seven credit cards.
2. But they are minimalists, only carrying balances on about four credit cards or loans at a time.
3. The vast majority carry less than $8,500 in total debt (not including mortgages), while about one-third carry more. F or the most part, they use less than 7 percent of their available balances (that's $700 on a $10,000 card).

To read the entire article from Mandi Woodruff | Business Insider:
http://finance.yahoo.com/news/6-things-people-stellar-credit-170120241.html

Inspirational Quotes@Inspire_Us from Twitter:
I'm a great believer in luck and I find the harder I work, the more I have of it. -Thomas Jefferson

 

Personal Finance News Monday 10/22

Phil's Personal Finance Tip of the Day:

Simple Ways to Save Money on Your Water Bill
By Money Crashers | U.S.News & World Report LP – Tue, Oct 16, 2012 10:12 AM EDT


While reducing your water bill may not be too high on your list of ways to save money, it isn't a complete wash. According to a report by the American Water Works Association, infrastructure upgrades and improvements to our drinking water system are expected to cost at least $1 trillion between now and 2035, much of which will be passed on to consumers. And if you live in a rural area where there are fewer residents to share these costs, your bill could triple.

Start saving money now with these six ways to reduce your water bill:

1. Store cold water in the fridge. Instead of running the tap and waiting for the water to cool off each time you want a cold glass of water, fill up a pitcher or two and store them in your refrigerator. This works well if you use a pitcher with a water filter attached.

2. Take shorter showers. By reducing the time you shower by just four minutes, you can save almost 4,000 gallons of water per year. Focus on getting in and getting out. This can save as much as $100 on an annual basis and may help you save money on other utility bills, such as gas and electricity.

3. Don't let the water run when shaving or brushing your teeth. Don't make this mistake, since it's a complete waste of water. To rinse off your razor while shaving, just keep a cup of hot water next to you and dip it in every so often. When brushing your teeth, fill up your rinse cup and turn off the faucet.

To read the entire article from Money Crashers/U.S.News & World Report LP:http://finance.yahoo.com/news/simple-ways-save-money-water-141234232.html


Inspirational Quotes@Inspire_Us from Twitter:
To get the full value of joy, you must have someone to divide it with. - Mark Twain 

Personal Finance News Saturday 10/20

Phil's Personal Finance Tip of the Day:

There’s no need to curb your enthusiasm

October 18, 2012 By Harvey Mackay

 

The old cartoon strip character Calvin, of Calvin and Hobbes, once said the difference between him and the rest of the world was that … “Happiness isn’t good enough for me! I demand euphoria!”

 

Calvin is right. You must live with enthusiasm. It’s one of the most important attributes to success.
One of life’s greatest tragedies is that the curiosity, enthusiasm and excitement about life that we are born with seem to erode as the years go by.

When the challenges of daily life get in the way, it is easy to spend more energy on putting out little fires than on sparking enthusiasm for overcoming those challenges.

Henry Ford once said, “You can do anything if you have enthusiasm … Enthusiasm is the spark in your eye, the swing in the gait, the grip of your hand, the irresistible surge of your will, and your energy to execute your ideas. Enthusiasm is at the bottom of all progress. With it, there is accomplishment. Without it, there are only alibis.”

You may recall Henry Ford’s early struggles to make his fledgling company successful. His enthusiasm for building mass-produced cars that many middle class Americans could afford to buy revolutionized transportation and American industry. Enthusiasm prevented him from giving in to setbacks and pressure.

When my own enthusiasm wanes, and it sometimes does, I look for inspiration from three of my favorite resources. Their advice is timeless and far-reaching. And it is well worth revisiting any time you feel your spirit flagging.

“Enthusiasm is the priceless quality that makes everything different. The men and women who achieve the most are invariably inspired by enthusiasm. They approach life, its opportunities, and its problems with this vital characteristic,” said Dr. Norman Vincent Peale, author of “The Power of Positive Thinking.”

“Flaming enthusiasm, backed up by horse sense and persistence, is the quality that most frequently makes for success,” according to Dale Carnegie, one of the most successful inspirational writers of all time. Do you know his books “How to Win Friends and Influence People” and “How to Stop
Worrying and Start Living”? They are great first steps to cultivating enthusiasm for living.

To read the entire article from Harvey Mackay.com:
http://harveymackay.com/column/theres-no-need-to-curb-your-enthusiasm/

Mackay’s Moral: There is one thing more contagious than enthusiasm, and that is the lack of enthusiasm.

Personal Finance News Friday 10/19

Phil's Personal Finance Tip of the Day:

New Fannie, Freddie short-sale guidelines
Fox and Friends Thursday October 18th

Real estate guru Bob Massi weighs in:
http://www.foxnews.com/on-air/fox-friends/index.html#/v/1908969362001/new-fannie-freddie-short-sale-guidelines/?playlist_id=162383

Inspirational Quotes@Inspire_Us from Twitter:
Life is either a daring adventure or nothing at all. -Helen Keller

Personal Finance News Thursday 10/18

Phil's Personal Finance Tip of the Day:

Face-Off: CVS vs. Walgreens
By Angela Colley | Money Talks News – Wed, Oct 17, 2012 1:27 PM EDT

Retail giant Walgreens has nearly 8,000 locations in the U.S., and CVS has approximately 7,400.

With so many stores nationwide, it’s no surprise that both chains are raking in sales. CVS rang in $107 billion in revenue in 2011, compared to Walgreens’ $72 billion, according to the latest Fortune 500 report. But when it comes to the consumer, which drugstore is cheaper?

I recently set out to compare prices at both drugstores. Then I also factored in prices at big-box retailer Walmart and online merchant Drugstore.com, which was acquired by Walgreens in 2011 but offers different prices on many items. Here’s what I found:

1. Over-the-counter drugs

Considering drugstores have the word drugs in their name, you would think they’d be the cheapest on over-the-counter medicines. But I found a better deal elsewhere on an 80-count package of Advil

Liqui-Gels.

Drugstore prices:

• Walgreens – $10.99
• CVS – $10.99

Compared to:

• Walmart – $7.97
• Drugstore.com – $12.59

Walgreens and CVS tied; Walmart came out on top.
 
To read the entire article from Angela Colley | Money Talks News:
http://finance.yahoo.com/news/face-off-cvs-vs-walgreens-180840516.html

Inspirational Quotes@Inspire_Us from Twitter:
If we did all the things we are capable of, we would literally astound ourselves. -Thomas Edison  

Personal Finance News Wednesday 10/17

Phil's Personal Finance Tip of the Day:

Easy Ways to Lower Your Internet Bill

By Farnoosh Torabi | Yahoo! Finance – Mon, Oct 15, 2012 12:36 PM EDT

Being without Internet access can be more than a little inconvenient. It can mean a harder time staying up on the news, doing research for work and school and, of course, applying for jobs.

If you’re paying through the nose for Internet, or avoiding it altogether because of the cost, here are some basic strategies to get broadband for less — maybe even for free.

Dial Up

If you’re among the millions of Americans struggling to pay your monthly Internet bill, did you know that you can dial up for basically nothing? By doing a search for “free internet dial up” along with your city and state, you’ll find a number of options for free access numbers. It’s an old technology but a perfect option for low-volume surfing with no monthly fee or special software, plug-ins or spyware. Or sign up with Juno or NetZero to get up to 10 hours of free Internet time per month. If you need more hours, they have plans starting at $10 per month.

Sign Up For Low-Cost Programs

If you can’t bear the slow speed of free dial up, some of the country’s largest cable television companies and the FCC have banded together to bring low-cost, high-speed internet to low-income Americans. Depending on where you live, the three primary, competing low-cost Internet access programs are Connect2Compete, Comcast’s Internet Essentials and CenturyLink’s Internet Basics.

“Kiplinger’s research has found that you can get broad-band Internet service for as little as $10 a month if you qualify,” says Janet Bodnar of Kiplinger’s Personal Finance magazine. “How do you qualify? Perhaps your children are eligible for the school lunch program or you’re eligible for other types of government support programs.” Bodnar says you may, in fact, even be eligible for a $150 subsidy toward a computer or free Internet and computer training. Check out CheapInternet.com for guidelines and to find the best low-cost options in your area.

To read the entire article from Farnoosh Torabi | Yahoo! Finance:
http://finance.yahoo.com/news/easy-ways-to-lower-your-internet-bill.html

Inspirational Quotes@Inspire_Us from Twitter:
Ingenuity plus courage plus work equals miracles. -Bob Richards

Personal Finance News Tuesday 10/16

Phil's Personal Finance Tip of the Day:

Five Financial Moves Not to Make at Fifty
By Liz Davidson | Forbes

Liz Davidson is CEO of Financial Finesse, the leading provider of unbiased financial education for employers nationwide, delivered by on-staff Certified Financial Planner™ professionals. For additional financial tips and insights, follow Financial Finesse on Twitter and become a fan on Facebook.

Turning fifty used to be a milestone for retirement—you could plan to sock away much more money. That reality has changed dramatically. It is no longer true that:

• You’ll be in your peak earning years at age 50. Baby boomers may not enjoy their fifties as their top wage earning years after all with the fiscal crisis and the recession hitting right at the same time.
• Your kids will be out of the house. With 15.8 million adult children currently living with their parents, and 59% of Baby Boomers providing financial support to adult children who are no longer in school, Baby Boomers are not experiencing an empty nest.
• Your wealth will be higher than it was a decade ago. The “lost decade” of the 2000s continues, with $19.2 trillion of household wealth lost according to the U.S. Treasury.
• You can count on your company pension. Even if you have a pension in place, it doesn’t mean it will be there forever. Ford Motor Company wants to get out of the pension business altogether. They announced earlier this year that they were giving retired workers a choice to either keep their pension or take a lump sum payout. Ford was the first major company to make an offer like this—other companies may follow suit or change payout options altogether.
• You can count on Social Security. Social Security for those under age 55 is up in the air. In order to make sure Social Security is funded for everyone, we could see means testing or pushing out the minimum Social Security ages even further.
• Your expenses will decrease in retirement. Health care expenditures have increased over tenfold since 1980 to $2.6 trillion dollars. Many companies have stopped offering retiree medical benefits, and even discontinued retiree medical benefits for workers who were already retired. This trend of cutting back on retiree medical benefits is even spreading to cash-strapped state governments like Illinois.

Times have certainly changed. In today’s economic environment, once you pass the milestone of your fiftieth birthday, you have to be very careful not to make financial mistakes that you can’t correct. There are a few seemingly benign financial and lifestyle moves that can actually derail your retirement plans – watch out for these:

To read the entire article from Liz Davidson | Forbes:
http://finance.yahoo.com/news/five-financial-moves-not-fifty-101822239.html

Inspirational Quotes@Inspire_Us from Twitter:
Life may not be the party we hoped for, but while we’re here we should dance. -Anonymous

Personal Finance News Monday 10/15

Phil's Personal Finance Tip of the Day:

How to Make Your Retirement Savings Last
By Walter Updegrave | CNNMoney.com

I have about $700,000 and plan on retiring soon at age 62. How can I make this money last at least 30 years? -- Steve, Vevay, Ind.

Making sure your money lasts isn't your only goal for retirement. Presumably, you also want to be able to draw enough from your savings to live relatively comfortably the rest of your life. And I assume you would like to have some flexibility about how you tap this nest egg, so you can fund not just regular living costs but unexpected expenses and the occasional splurge.

I mention this not to quibble, but because understanding that you actually have several goals is important when deciding how to manage your $700,000 stash.

If making sure you didn't outlive your nest egg were your only consideration, you could simply put your entire 700 grand into an immediate annuity, a type of investment that gives you a monthly check the rest of your life. As long as you're prudent about how you go about it -- sticking to highly-rated insurers, spreading your money among enough companies to assure you're fully covered by your state's insurance guaranty association -- you could sit back and collect $3,600 a month, possibly more, for as long as you live.

But you would also give up something -- namely, access to your money. Once you buy the annuity, you can no longer dip into your stash for emergencies and such. You receive only the monthly payments. And unless you buy an immediate annuity with an inflation rider -- which usually means accepting an initial payment that's about 25% less than one without inflation protection -- the purchasing power of your monthly check will decline throughout retirement.

Such shortcomings are why putting your entire stash in an immediate annuity probably isn't the right way to go.

There's another option, however, that can give you the flexibility you need, plus a good shot at inflation protection. Just invest your 700 grand in a relatively conservative mix of stock and bond funds -- say, 50% stocks-50% bonds -- and withdraw the cash you need each year.

To increase the odds that your money will last at least 30 years, you could follow what's commonly referred to as the "4% rule" -- that is, withdraw 4% of your nest egg's value the first year of retirement, $28,000 in your case, and increase that amount by the inflation rate each year to maintain your purchasing power.

To read the entire article from Walter Updegrave | CNNMoney.com:
http://finance.yahoo.com/news/retirement-savings-last-174600419.html

Inspirational Quotes@Inspire_Us from Twitter:
If your happiness depends on what somebody else does, I guess you do have a problem. - Richard Bach

Personal Finance News Saturday 10/13

Phil's Personal Finance Tip of the Day:
The 7 Cs of Success
October 9, 2012 By Harvey Mackay

On the road to success, you may take a few detours, hit some roadblocks and arrive at a different place than you’d planned. I’m still on my journey, and I’m offering you my map for smooth sailing, traveling the Seven Cs of Success.

Clarity: 80 percent of success comes from being clear about who you are, what you believe in and what you want. But you must remain committed to what you want and make sure those around you understand what you’re hoping to accomplish.

A young mathematician was commissioned during wartime as captain of a submarine. Eager to impress his crew and to stress how important it is to strictly observe all safety procedures, the young captain called them all together for a meeting. His instructions went like this:

“I have developed a simple method that you would all do well to learn. Every day, count the number of times the submarine has dived since you boarded. Add to this the number of times it has surfaced. If the sum you arrive at is not an even number—don’t open the hatches.”

Competence: You can’t climb to the next rung on the ladder until you are excellent at what you do now.

Just remember two more things: 1) The person who knows “how” will always have a job, and 2) the person who knows “why” will always be the boss.

Constraints: 80 percent of all obstacles to success come from within. Find out what is constraining you or your company and deal with it.

The Gallup Organization conducted a survey on why quality is difficult to achieve. The greatest percentage listed: financial constraints. Often our lives and careers are shaped by kind of surroundings we place ourselves in and the challenges we give ourselves.

To read the other 4 C's and the rest of the article from Harvey Mackay.com:
http://www.harveymackay.com/the-7-cs-of-success/

Mackay’s Moral: Some people succeed because they are destined to, but most people because they are determined to.

Personal Finance News Friday 10/12

Phil's Personal Finance Tip of the Day:

Secrets of Self-Made Millionaires
By Daniel Bortz | U.S.News & World Report LP

Do you dream of becoming rich but aren't sure how to make your millions--or better yet, billions?

Who better to ask than the rich themselves about how they climbed their way to the top?

Steve Siebold did. He's spent the last 30 years interviewing the world's wealthiest people.

Siebold, author of How Rich People Think, spoke with U.S. News about what the rich have in common, how self-made millionaires attained their wealth, and why now is the best time to strike it rich. Excerpts:

[See What It's Really Like to Be Rich.]

What sparked your fascination with the rich?

I was a broke college student in 1984 and I wanted to be rich. But I didn't feel like I was getting the information I needed from my college business classes. In a lot of the classes, the business professors seemed to put down the rich, and that didn't make sense to me. So I started looking for outside sources until I found a millionaire to interview.

Was he difficult to find?

Yes, because I didn't know any millionaires and I was just a kid. I was probably 19 years old. And I found the rich don't really like to flaunt their wealth. Most of the rich, in my experience, aren't like Donald Trump--they're the polar opposite. They want to be left alone, because as soon as people know they've got a lot of money, people come after them and the media goes after them. They want to be quiet and unexposed.

The deal they made with me was I wouldn't give their name out unless they gave me permission, and very few of them gave me permission.

Have you found any commonalities among the people you've interviewed?

Their personality styles vary: Some are introverts, some are extroverts. But their belief systems around money are the same. That was the one thread that really helped me throughout the process:

They all have a really positive relationship with money. They think about money in terms of freedom, as opposed to the negative relationship a lot of people have with money.

To read the entire article from Daniel Bortz | U.S.News & World Report LP
http://finance.yahoo.com/news/secrets-self-made-millionaires-140214428.html

Scripture of the Day from Dave Ramsey.com:
2 Timothy 4:7 — I have fought the good fight, I have finished the race, I have kept the faith.

Please listen to the Dave Ramsey show live on WOR 710 from 2-4 PM EST. You can also listen to the 3rd hour 4-5 PM EST. at Dave Ramsey.com.

Personal Finance News Thursday 10/11

Phil's Personal Finance Tip of the Day:

To deed or not to deed?

Bob Massi Fox News Legal Analyst

Fox and Friends Thursday October 11th

 

Bob Massi answers your real estate questions:

http://www.foxnews.com/on-air/fox-friends/index.html#/v/1893505268001/to-deed-or-not-to-deed/?playlist_id=162383

 

 

Scripture of the Day from Dave Ramsey.com:

Luke 11:9 — So I say to you: Ask and it will be given to you; seek and you will find; knock and the door will be opened to you.

 

Please listen to the Dave Ramsey show live on WOR 710 from 2-4 PM EST. You can also listen to the 3rd hour 4-5 PM EST. at Dave Ramsey.com.

Personal Finance News Wednesday 10/10

Phil's Personal Finance Tip of the Day:
How to Retire Rich: 6 Smart Steps at Ages 50-66

Focus on the finish line. It's time to get serious about saving, and maybe cutting costs.

By Sandy Block and Jane Bennett Clark | Kiplinger – Tue, Oct 9, 2012 12:24 PM EDT

At this point, retirement isn't a far-off goal you'll worry about someday when you're ready for your second hip replacement. Unless you plan to work until you drop, retirement is staring you in the face.

That means it's time to get deadly serious about saving, especially if you haven't saved enough. And that's true for most people: Nearly a third of Americans age 55 and older have saved less than $10,000 for retirement, according to the Employee Benefit Research Institute. Only 22% have saved $250,000 or more.

With any luck, though, these are still your prime earning years, and some of your major expenses -- such as a down payment on a home and college tui­tion -- are behind you. "With our clients, the last ten years that they work is when they save the most money," says Mark Bass, a certified financial planner in Lubbock, Tex. To make sure you're on track, don't hesitate to seek help from a financial planner or use the many resources available on the Internet.

[More from Kiplinger: State-by-State Guide to Retiree Taxes]

Take advantage of catch-up contributions. Once you're 50 or over, you can contribute thousands more to your 401(k) plan than your younger colleagues. For 2012, you can contribute an additional $5,500 over the annual limit of $17,000, for a total of $22,500. Any employer contribution on top of that is gravy.

Don't stop there. You can also make a $1,000 catch-up contribution to an IRA, for a total contribution of $6,000 in 2012. Unlike with a traditional IRA, you don't have to take annual minimum withdrawals from a Roth once you turn 70 1/2. There are, however, income limits on Roth contributions. You're eligible if your modified adjusted gross income is less than $125,000 ($183,000 if you're married and file jointly).

Dare to downsize. You may have hoped to move to smaller digs as soon as the kids were grown (and the boomerangers departed). But some homeowners who have seen the value of their homes decline in recent years are reluctant to sell until the real estate market rebounds, says Michael J. Nicolini, a certified financial planner in Elkhart, Ind. Even if your home hasn't returned to its former value, moving to a smaller home could save you thousands of dollars a year in taxes, utility costs and insurance. That's money you can funnel into retirement savings.

To read the entire article from Sandy Block and Jane Bennett Clark | Kiplinger:
http://finance.yahoo.com/news/how-to-retire-rich--6-smart-steps-at-ages-50-66.html

Inspirational Quotes@Inspire_Us from Twitter:
In life you are either a passenger or a pilot, it's your choice. -Unknown

Personal Finance News Tuesday 10/9

Phil's Personal Finance Tip of the Day:

How to Survive Unemployment
By Angela Colley | Money Talks News – Mon, Oct 8, 2012 10:46 AM EDT

According to the U.S. Department of Labor’s Mass Layoffs Summary, 1,032,764 people have been laid off so far this year – and that’s just the reported numbers.

If you’re one of the recently unemployed, I feel for you. I’ve been there.

It’s a scary thought to realize you just cashed your last paycheck and don’t know where the next will be coming from. But you’ll survive. I once went unemployed for six months, and did so without spending my weekends at home alone or eating ramen for dinner. I lived well and you can too. Watch the following video, then follow the steps below…

1. Apply for unemployment benefits

You can claim unemployment benefits if you lost your job through no fault of your own. The U.S. Department of Labor says it takes two to three weeks to start receiving benefits after you file a claim, so start the process the instant your job ends. Some states allow you to apply over the phone or online, while others require an in-person visit. To find out what your state offers, check out the DOL’s list of state unemployment offices.

How much you’ll receive is determined by formulas that vary by state, but typically is based on what you earned over the previous 52 weeks. For example, one common formula pays half of what you used to earn, with a cap that’s tied to your state’s average earnings.

In most states, you can receive benefits for up to 26 weeks, but there are programs that can extend it.

For example, a federal program called Emergency Unemployment Compensation (EUC) offers additional benefits, but ends on Dec. 29, 2012.

There’s also a combined state/federal program called Extended Benefits that provides 13 to 20 weeks of additional benefits to those exhausting state compensation. But this program is only available in states where the unemployment rate is above an established threshold. Your state employment office can tell you if your state qualifies.

And don’t get caught off-guard regarding income taxes: Unemployment compensation is taxable.

2. Go on an unemployed budget

Before the Great Recession, financial experts recommended saving three to six months of expenses as an emergency fund, naturally assuming you’d find a new job in that time. And while you might, times have changed. In August, the U.S. Department of Labor said people who have been unemployed long-term made up 40 percent of the total unemployment rate. Given those statistics, you might have to stretch your emergency fund out longer than you wanted to, so put your money on a survivor’s diet now. Here’s how to pull it off:

1. Tally up your savings and unemployment benefits and then divide the total into several months of “income.” This is how much you can spend in a month and survive. (How many months you’ll need is impossible to tell, but play it safe and aim for close to a year or more.)
2. Update your budget and look for savings. For example, when I was first laid off, I went through my bills and realized I could downgrade my cell phone and Internet packages, saving myself $45 a month.
3. Take a hard look at your spending and see what you can cut without losing your quality of life. For example, you don’t really need cable if you have Netflix. In You Don’t Have to Pay for Cable TV, we figured out that the average cable subscription costs $900 a year. Netflix costs about $120 a year. Switch and save $780 year.
4. Be smarter, don’t pinch pennies. You probably can’t spend as much as you used to, but you don’t have to make yourself miserable watching every penny while you’re unemployed. Just use a few easy money-saving techniques, like buying things when they’re on sale, using coupons, or buying generic. We’ve got loads of helpful advice on this site, like: 30 Tips to Save on Food, 7 Things You Should Always Buy Generic, and 205 Ways to Save Money.

To read the entire article from Angela Colley | Money Talks News:
http://finance.yahoo.com/news/survive-unemployment-095001997.html

Scripture of the Day from Dave Ramsey.com:
Proverbs 24:16 — For though the righteous fall seven times, they rise again.

Please listen to the Dave Ramsey show live on WOR 710 from 2-4 PM EST. You can also listen to the 3rd hour 4-5 PM EST. at Dave Ramsey.com.
 

Personal Finance News Monday 10/8

Phil's Personal Finance Tip of the Day:

The Myth of the Black Friday Deal
By DANA MATTIOLI/The Wall Street Journal October 8, 2012, 10:59 a.m. ET

Attention Black Friday shoppers: You're probably wasting your time.

After crunching two to six years' worth of pricing data for a number of typical holiday gifts, The Wall Street Journal has turned up the best times to go deal hunting — and they almost never involve standing in the freezing cold all night.

It turns out that gifts from Barbie dolls to watches to blenders are often priced below Black Friday levels at various times throughout the year, even during the holiday season, and their prices follow different trajectories as the remaining shopping days tick down.

Watches and jewelry, typical last-minute quarry for well-heeled shoppers, get more expensive as the season progresses, according to Decide Inc., the consumer-price research firm that gathered and analyzed the data for this article. Blenders, which might sit around for months if they aren't bought in the holiday window, get much cheaper at the end.

To read the entire article from The Wall Street Journal:
http://online.wsj.com/article/SB10000872396390443615804578042700772445448.html?mod=WSJ_hpp_LEFTTopStories


Scripture of the Day from Dave Ramsey.com:
2 Corinthians 3:2–3 — You yourselves are our letter, written on our hearts, known and read by everyone. You show that you are a letter from Christ, the result of our ministry...not on tablets of stone but on tablets of human hearts.

Please listen to the Dave Ramsey show live on WOR 710 from 2-4 PM EST. You can also listen to the 3rd hour 4-5 PM EST. at Dave Ramsey.com.

Personal Finance News Saturday 10/6

Phil's Personal Finance Tip of the Day:

Winners thrive on competition
September 27, 2012 By Harvey Mackay

I hate to lose.

That said, I am proud to admit that competition has made me a better businessman, a better golfer and a better person. And when there isn’t another company or business to compete with, I try to outdo myself. If that sounds simple, well, it is. I always want to be at my best and show my best side.

People can exceed expectations when motivated properly. This story, told by Andrew S. Grove, former CEO of the Intel Corporation, the California manufacturer of semiconductors, is a perfect illustration.

For years the performance of the Intel facilities maintenance group, which is responsible for keeping their buildings clean and in good shape, was sub-standard. No amount of pressure or inducement seemed to do any good.

Then Intel initiated a program in which each building’s upkeep was periodically given a score by a resident senior manager. The score was then compared with those given the other buildings. Result:

The condition of all of the buildings improved dramatically – almost immediately. Nothing else had been done. People did not get more money or other rewards. What they did get was the stimulus of competition.

Competition drives performance. It drives people to work harder and dig down deeper to deliver more than they ever thought they could.

Among the many benefits of increased market competition according to the tutor2u website are:

1. Lower prices for consumers.
2. A greater discipline on producers/suppliers to keep their costs down.
3. Improvements in technology with positive effects on production methods and costs.
4. A greater variety of products from which to choose.
5. A faster pace of invention and innovation.
6. Improvements to the quality of service for consumers.
7. Better information for consumers, allowing people to make more informed choices.

To read the entire article from Harvey Mackay.com:
http://harveymackay.com/column/winners-thrive-on-competition/

Mackay’s Moral: If you go the extra mile, you will almost always beat the competition.

Personal Finance News Friday 10/5

Phil's Personal Finance Tip of the Day:

Your right to resell your own stuff is in peril
By Jennifer Waters | MarketWatch – Thu, Oct 4, 2012 11:34 AM EDT

CHICAGO (MarketWatch) — Tucked into the U.S. Supreme Court’s busy agenda this fall is a little-known case that could upend your ability to resell everything from your grandmother’s antique furniture to your iPhone 4.

At issue in Kirtsaeng v. John Wiley & Sons is the first-sale doctrine in copyright law, which allows you to buy and then sell things like electronics, books, artwork and furniture as well as CDs and DVDs, without getting permission from the copyright holder of those products.

A Supreme Court case could limit the resale of goods made overseas but sold in America.

Under the doctrine, which the Supreme Court has recognized since 1908, you can resell your stuff without worry because the copyright holder only had control over the first sale.

Put simply, though Apple has the copyright on the iPhone and Mark Owen does on the book “No Easy Day,” you can still sell your copies to whomever you please whenever you want without retribution.

That’s being challenged now for products that are made abroad and if the Supreme Court upholds an appellate court ruling it would mean that the copyright holders of anything you own that has been made in China, Japan or Europe, for example, would have to give you permission to sell it.

“It means that it’s harder for consumers to buy used products and harder for them to sell them,” said Jonathan Bland, an adjunct professor at Georgetown University Law Center, who filed a friend-of-the-court brief on behalf of the American Library Association, the Association of College and Research Libraries and the Association for Research Libraries. “This has huge consumer impact on all consumer groups.”

Another likely result is that it would hit you financially because the copyright holder would now want a piece of that sale.

It could be your personal electronic devices or the family jewels that have been passed down from your great-grandparents who immigrated from Spain. It could be a book that was written by an American writer but printed and bound overseas or an Italian painter’s artwork.

It has implications for a variety of wide-ranging U.S. entities including libraries, musicians, museums and even resale juggernauts eBay and Craigslist. U.S. libraries, for example, carry some 200 million books from foreign publishers.

To read the entire article from Jennifer Waters | MarketWatch:
http://finance.yahoo.com/news/resell-own-stuff-peril-040302428.html

Inspirational Quotes@Inspire_Us from Twitter:
You will never do anything in this world without courage. It is the greatest quality of the mind next to honor. -Aristotle

 

Personal Finance News Thursday 10/4

Phil's Personal Finance Tip of the Day:

Legitimate work-at-home opportunities via social media
From Clark Howard.com

Posted: 6:00 a.m. Thursday, Oct. 4, 2012

Your average social media user is now able to get paid for posting product links in what's amounting to a new area of growth in online retailing.

The New York Times reports websites like Beso.com and Refer.ly will pay you for essentially doing your own advertorials and telling others on Facebook, Pinterest, or Twitter about what it is you're out there buying.

As you might imagine, this is very popular among women who are posting about shoes, dresses, and other fashion items.

There are also apps for this sort of thing like Pose, available for smart phones and tablets. With Pose, you set up your own online fashion magazine and if people buy from it, you get a commission.

To read the entire article from Clark Howard.com:
http://www.clarkhoward.com/news/clark-howard/shopping-retail/legitimate-work-home-opportunities-social-media/nSSXZ/

Please listen to the Clark Howard show 1-3PM ET Monday to Friday:
http://www.clarkhoward.com/

Inspirational Quotes@Inspire_Us from Twitter:
We cannot become what we need to be by remaining what we are. -Max De Pree

Personal Finance News Wednesday 10/3

Phil's Personal Finance Tip of the Day:

13 Ways Americans Throw Away Money
By Jill Krasny, Gus Lubin and Shlomo Sprung | Business Insider – Mon, Oct 1, 2012 12:33 PM EDT

Blame the government or blame the economy, but Americans should also blame themselves for their declining net worth. We waste a whole lot of money. Seriously, over half a trillion dollars.

This list is based on estimates due to limited available data, and the true total is surely higher. We included things like cigarettes and gambling, even though some would claim they are are worth their cost. This is a personal finance site after all, and these are costs you can cut.

To read the entire article from Business Insider:
http://finance.yahoo.com/news/13-ways-americans-throw-away-money.html


Scripture of the Day from Dave Ramsey.com:
2 Corinthians 2:14 — But thanks be to God, who always leads us as captives in Christ's triumphal procession...

Please listen to the Dave Ramsey show live on WOR 710 from 2-4 PM EST. You can also listen to the 3rd hour 4-5 PM EST. at Dave Ramsey.com.

Personal Finance News Tuesday 10/2

Phil's Personal Finance Tip of the Day:

10 Common Credit Myths That Could Be Costing You Money
By Erik Carter | Forbes – 22 hours ago

Managing credit is one of the most common subjects that I’ve been getting asked about lately.

Perhaps it’s because so many had their credit scores damaged during the recession and are now trying to improve them in order to qualify for the record low mortgage rates we’ve been seeing. In addition, employers have increasingly been using credit scores to evaluate applicants and especially in this job market, every little factor really counts. So regardless of your motivation to increase your credit score, here are some of the most common credit myths I’ve heard that could be hurting your score:

1) I haven’t done anything wrong so my credit is fine. Even if you’ve done everything right, your credit could still be in trouble. That’s because 70% of credit reports have errors on them. In the likelihood that you have one of them, you could be paying more in interest than you need to be.

2) If I check my credit report, it will hurt my score. Checking your own report generally doesn’t hurt your score but errors do so don’t let this be an excuse not to do it.

3) I’ve checked my credit report and there are no errors so I don’t have anything to worry about. You actually have 3 credit reports (from Experian, Equifax, and TransUnion) so if you’ve only checked one, there’s still a chance that errors on one of the others is hurting you.

4) I can check my credit reports for free at freecreditreport.com. First, many sites like this only give you access to one report, which is from Experian in this case. Second, freecreditreport.com ironically isn’t exactly free. It’s one of many copycat sites that charges you a fee to see your credit report and then charges you a monthly fee unless you cancel within a short period of time. Instead, you’ll want to go to annualcreditreport.com, which allows you truly free access to each of your credit reports once every 12 months.

To read the entire article from Erik Carter | Forbes:
http://finance.yahoo.com/news/10-common-credit-myths-that-could-be-costing-you-money.html 

Scripture of the Day from Dave Ramsey.com:
Habakkuk 2:3 — For the revelation awaits an appointed time; it speaks of the end and will not prove false.

Please listen to the Dave Ramsey show live on WOR 710 from 2-4 PM EST. You can also listen to the 3rd hour 4-5 PM EST. at Dave Ramsey.com.

Personal Finance News Monday 10/1

Phil's Personal Finance Tip of the Day:

17 Steps to Make Your Money Last a Lifetime
By Kimberly Palmer | U.S.News & World Report LP – Fri, Sep 28, 2012 12:51 PM EDT

Living to 100 is expensive, but taking time to run through this annual checklist will help you afford it. Here are 17 steps to a more secure financial life:

All ages:

-- Analyze your spending over the last month to see where your money is going and where you might be able to cut back to add more to your savings. Many banks offer free money tracking through online accounts, and money-tracking tools such as Mint.com make it easier to follow the dollars, too.
-- Calculate how much money you want to have saved before you retire (online calculators can help). For a shortcut, multiply your current annual salary by 12. Figure out how close you are to reaching that goal and what needs to change, such as working longer or saving more, to reach it.
-- Check up on the investment fees you are currently paying through your retirement accounts and consider whether it makes sense to shift into lower-fee funds.
-- Make sure you are taking advantage of all tax breaks available to you. Retirement savings accounts such as 401(k)s and IRAs offer a variety of tax advantages. Check with your human resources department to see if there are any employee benefits you're not taking advantage of.
-- Balance your portfolio once a quarter to make sure it reflects your current age and ideal risk level. For a 30-something, that might mean 70 percent in stocks and 30 percent in bonds and other, more-conservative securities. For a 60-something, it might mean the reverse combination.
-- Explore lifestyle changes that could boost your personal savings rate. Does it make sense to live with other family members in a cross-generational household? Will it make sense to do so in the future?

20s and 30s:
-- Write a will, and also consider creating durable power of attorney and healthcare proxy documents.
-- Make sure you have an appropriate amount of life insurance, especially if family members depend on your income.
-- Increase your savings rate over time until you reach your goal percentage. For a 20-something without a pension, the goal percentage might be 20 percent of one's income. Automate savings through your bank accounts or paycheck.
-- Minimize the amount of debt that you carry, especially high-interest debt, such as credit card debt.

If you do carry such debt, make a plan to aggressively pay it off.

To read the entire article from Kimberly Palmer | U.S.News & World Report LP:
http://finance.yahoo.com/news/17-steps-money-last-lifetime-143148408.html


Inspirational Quotes@Inspire_Us from Twitter:

In this life we cannot always do great things. But we can do small things with great love. -Mother Teresa