Tips to Save Money – Take the Time for Savings

 General, Saving Money
Mar 272010
 


You just might be able to find a way to save money today if you just stop and take the time to get your financial house in order. Over time, we tend to let some of the little things build up that could be saving us some money in our budget. Little things like the wrong cable or internet package or credit card, or not shopping around for the cheapest insurance. Sometimes it’s easier to let these things slide and stick with what we know. But, it would pay off to take a little time a few times a year and review your expenses and budget.

Here’s a few quick tips to save money on your personal finances:

  • Take a look at how much you contribute to your retirement savings like your IRA or 401(k) plan. See exactly how much your employer will match of your contribution and, if you’re not there yet, increase your own retirement contribution. One of the ‘easiest’ ways to save money is to put it away before you even realize you have it.
  • Cut you cable bill…or ditch cable altogether. If you don’t do so already, you might be amazed how many shows and movies you can watch online. And this doesn’t mean necessarily ditching the TV. You can connect you laptop to your TV with a simple connection. Do a little research on this and you’ll be amazed what’s not possible. And, you can also get quite a few channels, in digital, with a simple antennae watching over-the-air free broadcasts in your area.
  • Shop around for the best bank.  It might be a hassle getting all your automatic deposits and bill payments changed over, but you can possibly save a bit of money doing so.  In addition to not paying fees, it’s quite possible to be earning interest on your balance.  There are a lot of choices out there now and it would be in your best interest to shop around for the best deal.
  • If you use your credit cards, by all means pay them off every month.  Do not give away money to credit card companies through exorbitant fees and interest rates.
  • Better yet, find a card you can use for cash rewards.  It will definitely take some work, but it is quite possible to find a card that will give you a decent cash reward…nothing better than cashing a check from your credit card company.
  • Compare auto insurance rates every time your policy comes up for renewal.  Don’t get complacent with your policy when you might find a better deal elsewhere.  Many companies will give a discount if you have an auto and home policy with them, so make sure to consider that option as well.
  • Make sure you aren’t over-insured on you auto insurance policy.  While you busy checking for new rates, revisit exactly what coverage you have and what you might need.  It doesn’t always make financial sense to keep full coverage on your ten-year-old car if the replacement value has dropped too much.

A lot of these suggestions and tips to save money might take some time to implement.  Of course it’s probably easier to just continue paying on those accounts you’ve had for years, but you could be leaving a lot of money on the table.  Revisit these payments and accounts regularly, set aside a few hours each month for some research and start putting more of your money towards investments and assets.

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The Cost of a Mutual Fund

 General, Mutual Funds
Mar 252010
 


Buying mutual funds can both be a simple process as well as an exercise in frustration. The number of choices alone are dizzying, but the cost of a mutual fund is a bit confusing at times. Recent advice would tend to suggest that you should examine much more than just the expenses when considering a mutual fund, and this still holds true more or less.

Common wisdom suggests that it is best to avoid mutual funds with high expenses. Why bother to fight for modest returns when the fund manager is racking up expenses. However, the performance on a fund is usually given with rate of return after expenses–that is, after all of the operating expenses have been accounted for. The cost of owning, not buying, a mutual fund is usually defined as its expense ratio. The cost of buying a mutual fund is defined by its sale load.

The expense ratio contains the fees involved in running the fund including costs like the management fee and the operating costs. The price of sending out mailings, and in some case advertising for the fund, all fall under the category of costs. The expense ratio of mutual funds vary quite bit surprisingly. Some of the more efficient index funds have relatively low, like around .20% expense ratio, while the more expensive mutual funds sit around 1.5-2%.

The big problem with expensive mutual funds is that they are always hindered by that expense. The rate of return might go up and down, fluctuating with the market or economy, but that big up front expense will remain constant. A nice yield is hard enough to produce without having to fight against the tough odds of high costs.

Ultimately, there is more to consider than the expense of a mutual fund–the historical performance of the fund as well as the risk profile being among those. Still, a relatively expensive fund shouldn’t be completely ruled out if all the other factors fall in its favor.

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Pay Down Your Mortgage…Or Not

 General, Home Loans
Mar 202010
 


Many homeowners are faced with question of whether it’s a good idea to pay down their mortgage if they have some extra money. The benefits are many. Most importantly, you can reduce the length of your loan. If you simply make an extra payment or two, especially early in the loan, you can take quite a bit of time off your mortgage. The more you pay down and the earlier you do it, the better.

However, it might not actually make sense to pay down your home loan. There are quite a few factors involved when making this decision. You need to first do the basic calculations about how much you owe, how long the loan remains in effect, what your current interest rate is and what your other outstanding debts are. As mortgage rates fall lower it makes less sense to pay down your loan. Likewise, if you have credit card debt that is a higher interest rate you need to pay that down first.

Still, even after you’ve made some basic calculations, you need to dig a little deeper. Remember that payments on the interest of your home loan are tax deductible. The less interest you pay the less of a deduction. You need to figure this into your overall savings when you pay down the principal of your loan. The NYTimes has a good article on the details of this decision.

Ultimately, it boils down to numbers of course, but there is the emotional element involved with a home mortgage loan that is not always found elsewhere and which will usually play into your decision. It simply feels right to put some extra cash toward that mortgage. The idea of possibly paying off your house in 25 rather than 30 years is a notion that can’t always be quantified.

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Home Mortgage Refinancing Redux

 General, Home Loans
Mar 152010
 

The recession has certainly caused more than just a bit of pain for consumers and especially for home owners. However, as a result of mortgage rates that continue to fall and have reached some of the lowest rates seen in a long time, it is becoming a perfect time to refinance.

The great difficulty at this point in choosing the best method to refinance your home is finding exactly where to seek these funds. Refinance.com is a great place to begin your hunt for the best refinance rates as well as basic guidance and a host of other resources. They offer resources like clear and informative articles on why someone should refinance, basic myths about the process, how to determine whether you’d want a fixed or ARM loan and much more.

One of the key differences that Refinance.com offers from other such services is that they help guide you through the process rather than simply shuffling you off quickly to a lender. During the application process, they allow you to take a peek at your credit report that includes your score through Experian. If your credit score comes up a little low, they advise ways to improve it. They take the time to offer you suggestions to make your loan application more appealing to lenders and thus ultimately more likely to be approved with good terms. Once they have helped you craft your application you can choose amongst the best offer and submit an application with that company.

Remember, a Mortgage Refinance is not a simple decision that should taken lightly. But the fact remains, if you do your research, find the right lender with the right terms and know the purpose of your refinance, it can save you money and should be pursued. It’s impossible to predict the future and no one knows where mortgage rates are headed, but they are clearly low now.

Take some time to check out Refinance.com’s homepage, watch their short video on the process and if you like what you see submit a free application.

Disclaimer

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Tax Credits and Deductions for a New Year

 General, Taxes
Mar 092010
 


Tax season rolls around every year, whether we like it or not, and it’s really best to be prepared for any new tax credits or deductions that have been created since you last filed. In fact, it’s probably a good idea to go ahead and refresh your memory for any good tax tips from prior years as well.

This year, Congress introduced several new tax saving methods in the American Recovery and Reinvestment Act. Here are a couple of highlights:

Homebuyer Tax Credits ~ In addition to a pretty strong buyers market right now in the real estate world, there are some nice home buyer tax credits. First time home buyers can receive a $8,000 credit while those who have been in a home for five years but have bought something new may be able to get a $6,500 tax credit.

Residential Energy Incentives ~  The government is keen to see you go green and they’ve devised a few incentives to push you along. Credits that were set to expire have been extended and the amount of credit you can claim on energy efficient improvements has been raised as well.

Education Tax Credits ~ Perhaps you’ve heard of the Hope Credit, well now that’s been replaced with the American Opportunity credit.  This new and improved credit will extend help to more taxpayers than before and raises the potential credit to $2,500 versus the old $700.

These are just a few of the new tax credits we’ve seen this year.  Take your time and really explore all of the potential tax savings that are now available and you might just be surprised what you can save.

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Credit Card Company Loopholes

 Credit Cards, General
Feb 202010
 


There are changes on the horizon in the credit card world, presumably to help consumers from getting gouged from the credit card companies. The Credit Card Accountability, Responsibility and Disclosure Act of 2009 is designed to lower unfair fees and reduce overly high interest rates as well as eliminate other questionable policies.

There are, however, several loopholes that the credit card companies can use to sidestep some of these new regulations and consumers should be aware of them.

This article in the Washington Post covers a few of these and is worth the time to read.  The author mentions ways in which the companies can still charge high rates as well as unnecessary fees.

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Personal Finance Stories in Review

 General
Feb 012010
 


David Randall over at Forbes has provided a nice little rundown on some recent Personal Finance stories that have recently appeared at Forbes, the New York Times, Washington Post and elsewhere.

Of interest is an article on preparing your first retirement account.

Also, 11 financial tips for new parents.

And, very amusing article on haggling for the best price at traditional retail stores like Best Buy and Macy’s.

Check out his article.

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Financial Planning Starts With The Basics

 Budgeting, General
Nov 052009
 

As you coordinate a system for your personal financial well-being, the hard task is finding out where to begin. A responsible person looking to save money should first understand and analyze one’s big financial picture. This should happen before trying to get into stocks and bonds or even life insurance

There are two useful tools that will help you to do that: A Cash Flow Statement and a Balance Sheet. These will let you take a detailed inspection of your financial state and create more reasonable decisions about what you choose to do next. It might take a little prep work, but developing these tools will get you started so you can make the harder decisions later. Continue reading »

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Web Hosting Providers

 General
Sep 212009
 

Part of watching your personal finances includes finding the best and most affordable deals available.  Well, if you’re running a website, or thinking of starting up a blog or new website, then you’ve no doubt spent some time looking for a good web host provider. I know I’ve spent too much time jumping from host to host trying to compare their rates and their specs to find the best deal as well as the most reliable service.  Fortunately, Web Hosting Geeks has made it easy with their site whether you’re looking for simple shared hosting, dedicated server hosting or a number of other hosting options.

Web Hosting Geeks has made the process easier by putting together a list of great web hosts and then providing details such as disk space and bandwidth specs right on the same page.  You can also scan the different hosts judged to be best in each category such as best budget hosting, blog hosting or reseller hosting to name just a few.

Another nice feature that Web Hosting Geeks has is a list of topics in their blog to give you information on a bunch of different topics from basic hosting to security issues to eCommerce.  For example, they’ve conveniently listed some things to look for when you’re shopping for a host in an article called “4 Critical Factors to Consider Before Choosing a Cheap Host” to help you figure out what you need to know.

So, if you’re looking to save some money AND find the best and most reliable web host for your needs, check out Web Hosting Geeks to review your options in one, convenient location.

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Don’t Forget about Life Insurance

 General, Insurance
Aug 102009
 


We frequently discuss personal finance issues such as saving money, investing wisely and alleviating your debt, but sometimes we forget to talk much about life insurance. It’s true that life insurance can be easily put off, due largely because it might just not be that pleasant to think about. Also, for many people, it seems like a complicated and time consuming process.

The folks at Financial One have helped make the process much easier with a no obligation, instant quote where you can compare life insurance rates from over a hundred companies at once. They choose to give you quotes quickly from so many companies, but also accurate rates so you really know what you’re getting.

Sure, it’s easy to put off getting some life insurance, but it is one of the more important financial decisions you can make. You have to think of your family and their financial well-being should anything happen to you, insuring that your family has a stable and secure future. Remember, don’t forget about life insurance–get a free quote from Financial One today.

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Little Risk and Little Rewards

 Banking & Loans, General, Personal Investing
Jun 262009
 


This has not been the best time to earn some good interest on your money. If you are trying to keep your money in low interest investments or accounts, you really don’t stand much to gain. Most online savings accounts are running around the 1.5% APY mark, and the best you can expect from a shorter-term CD (ie 6 months to a year) is around the 2.0% range. You can stretch that interest rate out to around 3 – 3.5% if you’re willing to tie your money up for 5 years, but that is probably not a wise move at these low rates. I mean, really, interest rates have nowhere else to go but up at this point.

So, what options do you have right now?

Well, John Waggoner over at USA Today suggests looking into municipal bond funds if you’re willing to risk a little bit more. Currently, you can get around 3.5% yield, which isn’t really that great, but beggars can’t be choosers. As Waggoner puts it, “muni rates are higher than usual. A 10-year, high-grade muni now yields 3.54%. Someone in the 28% tax bracket would have to earn 4.92% in a taxable bond to get 3.55% after taxes.”

This might be a good option for someone looking for a slightly better yield that a CD or money market account though the risk of loss begins to creep into the picture.

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Good Things About a Recession?

 General
May 232009
 


We’ve touched on a few things now and again about the recession, both bracing for its arrival last year and then settling in once it arrived.

Here are five good things about the recession you may not have thought about before. Apparently, people actually become healthier during a recession.

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Spend or Save in a Recession

 Budgeting, General, Saving Money
Jan 302009
 


We’re usually pretty pro-save around here, regarding it as a key aspect to an overall sound personal finance plan. However, there is the larger issue of how your saving affects the overall economy. Some folks believe that when the economy is sagging that throwing money in the bank is further aggravating the problem. Conversely, others feel that putting money in the bank allows the bank to lend more money out–thus helping to stimulate the economy.

For the most part in the US, what we see in a recession, much like we’re seeing now, is that savings rates tend to climb. That is, more people start socking their money away in order to, presumably, weather the storm.

In the US in fact, there is currently a campaign called Feed the Pig designed to encourage folks to save. The site has some great advice on saving money and many tips for putting a little extra aside.

In Finland, however, the government is encouraging people to spend money in order to boost the economy. They’ve begun an ad campaign with an evil piggy bank–implying that in these tough times the thing to do for the good of the economy and the country is to keep on spending in order to spread the money around.

NPR has a nice little feature comparing the different approaches from the US and Finland.

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Financial Changes on the Horizon

 General
Jan 212009
 


Well, yesterday we saw the inauguration of a new president with many promises of change just around the corner.

Of course, among the many other, much larger, issues that are pressing on this country right now, we have to wonder how this will affect our own personal finance situation.

Specifically, how will President Obama’s stimulus plan change your financial situation.

There’s an interesting article here that covers some of the basics.  A lot of specifics–at least in a general sense.  For instance: “$145 billion in tax cuts for working individuals.  The tax cut would be $500 per person ($1,000 for a couple) and would phase out for people making over $75,000 a year ($150,000 for couples). You can get the money either by claiming it on your tax return, or through a reduction in the taxes that are taken out of your weekly paycheck.”

This will obviously be one of the biggies, but the article also mentions quite a few other programs–notably many improvements to the nation’s infrastructure, the education system and healthcare.

It will definitely be interesting to see where this goes.

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Sell Structured Settlements

 Debt Help, General
Jan 182009
 


Structured settlements can certainly be a handy method to settle a personal injury lawsuit.  In fact, the financial agreement is an often overlooked tool to help the parties in a lawsuit reach an agreement that is acceptable to both the injured party and the defendant.  In this case, instead of a, sometimes, large lump sum settlement, the structured settlement would spread the compensation out over an extended time period.  It is also possible, however, to sell structured settlements if you find you later need access to a lump sum amount.

In the case of selling an annuity payment like a structured settlement, you would be able to get the money now instead of waiting months or years to receive the total of your payment.  You can basically get direct access to your cash.

The folks at Settlement Capital do not plan or structure a settlement, but they can help you if you are looking to Sell Structured Settlements.  They are experts in the field of specialty financing, working since 1988 to provide payments in the secondary market of structured settlements.  They can help you understand the implications of such payments and get you a free quote so you can know exactly what you’re looking at should you choose to pursue this option.

In addition to obtaining a free quote, you can educate yourself on the nuances of structured settlements and other annuity payment options. Settlement Capital also has an informative blog and podcast for even more, varied  and timely information.  If you’ve been looking to SELL STRUCTURED SETTLEMENTS you should definitely spend some time on their website or contact them soon.

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