Personal Finance | Money Auto Pilots

3 Ways to Save Hundreds of Dollars Each Year

November 13, 2011 By admin Leave a Comment

Let’s face it; it is very hard to save money. Everyone would like to save money, but it always seems like there are urgent expenses and bills to pay. Many people are forced to spend all their money and have little or no savings to show for their hard work. While it is no doubt hard to save, anyone can save with just the tiniest amount of discipline. Here are three easy ways to save hundreds of dollars each year.

Invest in a 401K

If your employer offers a 401K, you should invest in it immediately. A 401K plan is just about the best way for an individual or family to save for the long term. You can choose the amount of money to save each pay period and unlike placing your money under your mattress, the money you save is invested, so that it grows over time. 401K plans are free to join and you usually have the choice of investing your money in a wide variety of opportunities.

Divert a Percentage of Your Paycheck to a Savings Account

Another great way to save each pay period which is not very common is to divert money from each paycheck to a savings account. If your employer offers direct deposit, they usually always offer the option to send money into not just one account, but several. This way you can siphon money off at the moment you get paid. If a large chunk of pay goes straight into your checking account and only a small percentage goes to your savings account, you might not even see the money you are saving. This ultimately means out of sight is out of mind, helping you to save a few bucks a month very easily. It should be noted that diverting a percentage of your paycheck to a second account is usually free.

Pay Yourself First Once You Get Paid

Everyone has expenses and once you get paid, you probably spend a good portion of your money on bills, purchases and necessities. While you may easily pay off your cable bill, the most important bill that never quite gets paid off is your savings. Make sure you pay yourself first- before anyone else. Just as you always have money to pay your cable bill, you can always find a way to save a small amount each pay period. The amount that you save each pay period can be $50 or a percentage, such as 5%. In a few short months, you will be amazed at just how much you were able to save.

Filed Under: Personal Finance Tagged With: 3 ways, 401k plan, 401k plans, Account, bill, cable, cable bill, employer, Everyone, no doubt

Retirement Financial Planning for Baby Boomers

November 13, 2011 By admin Leave a Comment

For many baby boomers retirement is around the corner. It is amazing how fast the years have gone by. In 2007 the oldest baby boomers started collecting social security, and in the following eleven years another 77 million are expected to do the same.What About Social Security.

Currently there are about 40 million retired people collecting social security. With another 77 million expecting to get their social security payments back with interest, that is going to be a tremendous strain on the system.

Most boomers (and those coming after them) realize that they cannot count on social security being around long enough for them to collect any of the money they paid into it. They are hoping that the government repairs the system, but they cannot depend on that.

Retirement Savings Accounts

For this reason it is very important that baby boomers and those following behind them start saving for retirement as soon as possible. A 25 year old who starts setting as little as $100 aside each month will have about $350,000 saved by retirement age (at 8% interest). In comparison, someone who starts saving at 40 or 50 years of age would need to put in a lot more than $100 a month to have $350,000 by age 67.

It is too late for baby boomers to start saving for retirement at 21, but it is never too late to begin saving. If your company offers a 401k sign up today. If they offer matching contributions, then sign up for the maximum deduction allowed.

A good retirement savings plan for small business owners is a Keough account. This is similar to a 401k. There is a certain amount you can put in each year that is tax deductible.

There are other retirement accounts available, too, such as traditional IRAs and the Roth IRA. The Roth IRA does not allow for tax deductions when you make the contributions, but you do not pay taxes on it when you make withdrawals.

Even if retirement is just a few years away, by starting to save today you will have something to live on. If on your 65th birthday you find that it isn’t enough to retire on, you can always work a few more years to build up the retirement fund some more.

How to Make Your Savings Stretch

Working part-time after you retire is often a good idea. It provides you with something to do that keeps you involved socially and exercises your mind. It will also make your retirement savings last longer.

Another way to make your retirement savings last longer is to start withdrawing from taxable accounts and let the tax-advantaged savings accounts compound for as long as possible.

Basically, baby boomers need to start planning for retirement now by having an IRA, 401k, or Keough (or a combination of these), and by getting out of debt now rather than later. The longer you wait to pay off credit card debt, car loans, and your house, the harder it will be for you to live on a fixed income when you reach retirement age.

Filed Under: Personal Finance Tagged With: Baby, baby boomers, cannot, retirement savings accounts, Savings, security, small business owners, social security payments, today, traditional iras

Choosing A Savings Account – A View From The Front

November 13, 2011 By admin Leave a Comment

Upon starting my search for a new savings account in which to place my hard earned savings I was full of optimism. I’d held a savings account for many years and was confident I knew enough to find a good deal in next to no time.

The truth was very different. In the years since I last took out a savings account the market has changed to the point of being unrecognisable. There are many more companies offering savings accounts. It used to just be banks and building societies. Now we also have supermarkets, online companies and other varieties to choose from.

To make matters worse there are also many more different types of savings account to choose from. Time was you put your money in your account and it earned a bit of interest which you put a side for a rainy day or used to treat yourself or your family.
Now you can choose from a easy access, regular savers, bonds, ISAs, the list goes on and on.

With all this choice I started to doubt my chances of wading through all the products to find the right one for me. Then I was introduced to price comparison websites. These sites allow you to look at hundreds, if not thousands, of savings accounts in just a few minutes.
By using price comparison I was able to remove all of the poorest accounts from the results table and leave myself looking a select group of accounts that offered all the features I wanted. Being able to see all the information in one place makes it much easier to make the right decision and be confident you’ve found a savings account that offers a good interest rate and does what you want it to.
I write this to encourage anybody who is finding it difficult to choose a savings account to try price comparison websites. If I can it successfully anybody can. It really is a great time saver.

Filed Under: Personal Finance Tagged With: Account, building societies, Choosing, Front, optimism, price comparison websites, Savings, savings accounts, select group, time saver

Systematic Investment Plan Can Help You To Save Money

November 13, 2011 By admin Leave a Comment

Systematic investment plan, as the very name suggests, refers to the time-tested strategy of buying and selling stocks at a pretty lower estimation. Unlike other investment plans systematic investment plans are quite risk free in nature.

It helps to create wealth in a regimented manner over a longer period of time. Many investors compare it with a wonder drug that cures all your investment related injuries. The winds of change have already set in with more and more people getting interested in opting for systematic investment plan. Systematic investment plan helps your money grow at a much faster rate without much trouble.

This very fact has been attested by the recent media reports. The reports suggested that the systematic investment plans are a great way to save money over a longer period of time. The minimum amount that can be invested is low compared to other investment options. The frequency of investment is usually monthly or quarterly. The systematic investment plan resembles a recurring deposit where you put small amount every month, which is automatically deducted, from your salary cheque. The only difference is that the amount is invested in a mutual fund.

Some of the benefits of systematic investment plan are as follows-
- Systematic Investment plan is a safe and convenient mode of investment perfectly suited for amateurs who are new into this field.
- Due to dollar cost averaging market timing becomes irrelevant making it all the more easier for investors.
- Systematic investment plan has also got a much greater power of compounding.
- Systematic investment plan also helps to save money on a regular basis.
- It is a hassle-free mode of investment, which requires you to devote just a few hours to get things done.
- Systematic investment plan serves as a great tool to counter inflation.
- It is a much cost-effective option of investment.
Important points to remember while making a systematic investment plan-
- Investing becomes a much simpler task if you can find the best time to buy and sell.
- Go for an automatic timing mechanism to avoid market oscillations and reap rich dividends easily.
- To reap the maximum benefits go for long-term investment plans (10- 15 years generally).
- Do a proper market research before taking the final leap. In this age of information boom there is really no dearth of information. You can stumble upon loads of information by only a click of the mouse button to answer all your nagging doubts.
- Get in touch with only reputed fund managers or brokers to avoid difficulties in investment.
- Take advice from friends or relatives who have invested in systematic investment plans.
- Take proper calculated moves and then decide the time span of investment.

Systematic regular investment helps you to adjust easily with the highs and lows in the market and makes the process of saving money all the more easier. So, do not ponder over your investment plans. Start saving money at a very early age through systematic investment plan and keep your retirement blues at bay.

Filed Under: Personal Finance Tagged With: free mode, information, investment options, Money, period, selling stocks, strategy, Systematic, systematic investment plan, time tested strategy

22 Ways To Build An Emergency Fund

November 13, 2011 By admin Leave a Comment

One of the most important things to have is an emergency fund.
If, for any reason, your income stops, your emergency fund should be able to carry you for at least 6-8 months.

Courtesy of Bankrate, below is a list of very good tips to build and maintain an emergency fund.

1. Start saving something today. It doesn’t have to be a large sum. Even on a tight budget, a small amount adds up over time. Depending on the size of your family, skipping a meal out each week could result in a savings deposit of $160 per month.

2. Treat saving as a bill. Consider having the amount transferred automatically from your checking account or paycheck. Pay your account every month or every two weeks.

3. Open a Christmas savings club. You may be able to set up an automatic deposit to come directly from your paycheck. You don’t think about spending the money you never see. When holidays arrive, you’ll have the funds to enjoy.

4. Get an envelope, cookie jar, coffee can or whatever you like and set aside the same amount every week. The trick: Don’t count it, don’t spend it!

5. Empty your pockets — or your purse — at the end of the night. Put all the change into a jar. Not only will you feel lighter, but your spare change adds up a lot faster than you think.

6. When you leave the house in the morning, don’t carry anything smaller than a $5 bill. When you get change, don’t spend the singles. At the end of the day, put any dollar bills in your jar.

7. You go to lunch and tip the waitress 15 percent to 20 percent (ten if you’re a cheapskate). Put an equal amount aside for yourself, and your “tips” will add up quickly.

8. Get “cash back” from your debit card at the checkout counter by rounding up to an even amount. Slip the small amount — $1, $2, $5 — into your savings jar. You’ll forget about a buck here and there.

9. Just paid off a big debt such as a car loan or child’s tuition? Keep making the payments — this time to yourself.

10. If you recently switched phone companies or discovered a flat-rate plan that’s saving you money every month, put that cash aside in your savings jar.

11. Electric or water bill lighter than you expected this month? Save the difference.

12. Use those shopping membership cards that print your “savings” at the bottom of your receipt to help you save. Give the savings back to yourself by slipping that money in your savings jar.

13. Getting a tax refund next year? Either put the check directly in your savings account or cash it and stash it.

14. If you have the discipline to use a credit card and pay off the bill every month, use one that promises a cash reward and bank the money.

15. Give up cigarettes — or even cut your habit by half — and put that money in the savings drawer. If you drop a pack-a-day habit by half, you could easily bank well over $100 in a couple of months.

16. Put a jar on top of the washer and put in a quarter — or two — every time you throw a load in the washer or dryer. Get your finances in order while you clean.

17. When you return your movies on time, pay yourself the late fee. If you rent a movie or two every week, you’ll be surprised how quickly that $1.50 to $4 can add up.

18. Trying to lose weight this season? Each time you go without dessert — or that mid-afternoon candy bar break — put the cost of your forgone goody into your savings jar.

19. Pop a quarter in a jar by the phone every time you dial a long-distance number. Bonus money: Shop your calling plan and find a better deal. Put the savings into the phone jar each month, too.

20. Try investing your savings in a certificate of deposit or an interest-bearing money market and watch it grow!

21. Buy U.S. savings bonds. Bonds yield more interest than the money earns in the jar.

22. Involve the whole family in saving. Plan a treat for everyone when you reach the savings goal. Make it something everyone will look forward to, but inexpensive, such as a day at the zoo, museum or beach.

Filed Under: Personal Finance Tagged With: amount, bankrate, bill, Change, checkout counter, christmas savings, deposit, emergency fund, phone, tight budget

Defining Personal Finance

November 13, 2011 By admin Leave a Comment

Personal finance is something every person has to, at some point in their life, understand. Whether you know it or not if you make money or have expenses then you have personal finance matters.

Personal finance is basically the money you earn and the money you spend. The whole idea of personal finance is to be able to afford what you need and, hopefully, what you want.

Good personal finance involves a lot of management. Without management you end up with financial problems, like credit damage and even possibly a bankruptcy.

In order to understand your personal finances you have to get them in order. To do this you need to do the following:

1. Gather all of your income information- check stubs or other financial statements of income, gather all bills – this includes any information on debts.

2. Go thorough your financial information and sort it out. You want all income in one pile and all expenses in another pile.

3. Find anything that is missing. If you have debts that you do not have information on then call the companies and get something in writing about he debts.

4. Create a record of your financial information. This record, your budget, will list your income and expenses.

5. Once you have everything written down you need to see if your expenses are greater then or less then your income. The goal is that you make more then you spend.

6. Identify problems with your spending, if any.

7. Develop a plan to allow your income and expenses to even out so you are earning as much or more then you are spending.
These seven steps will help you to get a good grip on your personal finances. You will be able to start to plan repayment of debts, see if you are spending money wisely and develop a plan to ensure you are never overspending and that your personal needs are met.

Understanding your personal finances is about more then making sure all your bills are paid. You will learn how to spend wisely and not waste money. You will learn how to make sure you are responsible for your debts, which will in turn help you keep a good credit rating. In the end you will be more relaxed about your finances. You will be able to borrow money when needed because your credit will be in good shape and you will not have to worry about meeting simple expenses.

Filed Under: Personal Finance Tagged With: check stubs, Finance, information, person, Personal, personal finance matters, personal finances, point, seven steps, spending money

Bite the Budget and Make Your Future Brighter

November 13, 2011 By admin Leave a Comment

When we think about budgeting, we often think of how a well thought-out budget can help us in the short term. We might have a holiday coming up, and by being careful with our money beforehand we can make sure we have enough cash to take with us to enjoy ourselves while we are away.

Similarly, if we are on a low income we will budget our money every week to ensure we can pay our bills and not spend too much on unnecessary items when we go shopping. In short, if we learn to budget properly, we find our money is much easier to manage.

But budgeting can also help us enormously when we have long term goals to meet as well. There might be things we would very much like to achieve in ten, even twenty years time, and if we are careful to put in place good spending and saving habits now, we could well have a nice nest egg to show for it in the future.

The best way to plan for your future is to make sure you try and save a set amount of money each month. There are lots of options for how to save it, and the one you choose will depend on how comfortable you are with risk. Over the long term, the stock market has always been a good performer, but it’s a good idea to take independent advice before making any firm decisions.

If your current budget is too tight to make saving a real possibility, your first task would be to pay off your existing commitments. If you have outstanding debts, you could consider getting a debt consolidation loan to combine them. These can lead to a better rate of interest, and you could save money every month by having one.
It’s always best to pay off any debts before beginning, as the rate of interest you will pay on these will be higher than anything you could get on your savings – no matter where you put them. If you budget well, you could find you can pay off the remainder of any loans early.

When you start to build your nest egg, consider what you will want to use it for and when. If you have an end date in mind – perhaps you want to go on a world cruise for a big birthday celebration at some point in the future – and you also have an idea of how much money you will need to cover it, you can then decide what kind of savings vehicle would be best for you.

Whatever you want to save for, remember that the sooner you start, the more you will have to enjoy in the end.

Filed Under: Personal Finance Tagged With: Brighter, debt consolidation loan, egg, Future, idea, independent advice, nest, nest egg, rate of interest, term goals

Family Budget

November 13, 2011 By admin Leave a Comment

A husband or a wife has the same responsibility on family savings, investments and expenditures. In short, both are responsible on making the family budget and make sure it works.

They need to calculate total income they earn and to plan the expenditure. Especially when they have kids….. They need to prepare tuition fees besides their own retirement plan.

What usually happens, a spouse hold his/her own income and keep secret from another, even he/she is lying about his/her expenditures avoiding the other spouse to get mad of his/her shopping habits. When the real financial problems come, they will blame one another for not taking the responsibility.

Marriage is about 2 persons in the same boat, going towards one direction, they have to cooperate well to reach their destination while they enjoy the journey. This includes financial goal.
Both have to negotiate about how they want to use the money, how much they will spend on grocery, tuition fee, cars, gasoline, make up, loans, vacation, and others. And work on those commitments, they should not break the rules and making excuses.

Please, do not blame your kids when you buy expensive sport shoes for them. You are the adult; you are the one who takes control. Do not make excuses that are for them, sometimes it is just the parents themselves that cannot stop the impulse purchases. Maybe the sales promotion girl was persuasive, or maybe there was a sale going on with 50% discount for buying the hot items.

Making a budget is a must, but making commitment on it is the most difficult part. That is why you should co-operate with your spouse to remind each other.

Sometimes to make sure you run well on your family budget, you can make some rules like:

Delay buying expensive items for 3 days, and if after 3 days you still want them, you will discuss your intention to buy with your spouse
Only buy what are needed, only buy grocery for 3 days stocks, so you can avoid overstock vegetables and meat.

Make a shopping list of what you need, and when you overbought yourself, cut your leftover money as much as you overspent, and put it on a ‘Piggy Bank”, but please keep your Piggy bank as far as you can, so it will not tempt you.

Make a budget on gifts. Gifts are presents, a way to show that you care. When you care a lot does not mean you have to give something extremely expensive. Make a promise on each other that the maximum for a gift is $ 30, or another amount, depending on your agreement.
Celebrate birthdays and anniversaries on budget, both spouse have to understand that the most important thing is the meaning of the celebration, not the event itself.

I am sure all of you can think of many other ideas to keep your family budget works.

Filed Under: Personal Finance Tagged With: Bank, expenditure, family budget, financial goal, grocery, husband, Piggy, retirement plan, shopping habits, sport shoes

Is Your Spending Out of Control?

November 13, 2011 By admin Leave a Comment

To reach a goal you have never before attained, you must do things you have never before done. – Richard G. Scott

Most Americans take for granted all of the abundance of material possessions and often lose sight of many of the things that are priceless. All types of apparel and merchandise are available to everyone with a reasonable desire to accumulate them. However, this is true only if you have the money to purchase them. Reports from a quick search in Wikipedia , a free online encyclopedia, finds that just in the United States alone, in April 2005, consumer spending reached a staggering sum of $753 billion. In 2006, the apparel and accessories figure went up 32 percent versus the same quarter this time last year.

Why is this? All of the material things that money can buy does not guarantee you lasting happiness. Yet, many people assume it is true. And it may be so – temporarily. Do you find yourself craving for and owning the best in every fashion item that comes along? The same holds true not only for the latest in fashion styles, but also the need to own the latest gadget, computer, auto, shoes., and furniture is mind boggling. The marketplace is the breeding ground for introducing more new items and pushing you to buy, buy, buy. No wonder your spending is out of control.

The law of supply and demand is alive and well. The big secret to living within your budget is knowing what you need versus what you crave because it is there. If no one purchases the retailer’s merchandise, many businesses would not be in business for long. When there is always a sufficient supply of merchandise for everybody, the need is irrelevant and becomes less important.

There seems to be a belief that you need not have to wait until you can pay cash for anything you wish to have. Instead, you whip out that credit card because you can. This is a well-won out habit and a difficult one for some to break. It is not easy to do if you constantly hold dark thoughts and feelings of lack, pessimism, and negativity inside. Buying, then, becomes the means to happiness.

All purchases, no matter what your reason is for the purchase, starts with your state of mind. You have complete control of your mind and the only thing you have complete control over. The habit of staying within a strict budget can be a good habit to develop.

When you experience depressive attitudes and hold negative thoughts, are you compelled to go out and buy, buy, buy? Practice looking at your life with a brighter view. Knowing that you do not have to be an impulse buyer is a step in the right direction. And knowing when you have control to not purchase an item you do not need or would never use, or wear, is rewarding. It is important to discipline your mind to express positive attitudes. In turn, this opens up the flow to more positive and thoughtful behavior.

Here are four quick and inspirational ways you can turn off the dependence on credit card debt.

1. Train and test your mind to accept the fact that just because you desire a certain item because it is available, you do not have to go out and buy it. Your life becomes richer and less dependent on material things.

2. Have faith in yourself and know that you have the guidance of a higher, universal intelligence. Backed with faith, you will know when the time is right for that all important purchase.

3. Stay healthy. Reduce as much stress in your life as possible. Stress leads to unwise shopping. With poor health and an unfit body, the mind lacks the strength and desire to make good choices and judgments. You also limit positive plans, thoughts, and solutions from entering your mind.

4. Know that happiness comes from within; not from buying and owning material possessions. Try going without using your credit card for a full week. See how free you become from your spending habit. Then, only make a purchase when it is absolutely necessary. You will control your overspending and stay within your budget. Then you will feel good!

I know this may not sit well with those in the business of selling, and I am a small business seller myself, however it just may be a wake-up call to us, too. We must realize that when you are ready to purchase from a positive position, and not just because the impulsive need is there, we must be there and ready to make the sale!

Filed Under: Personal Finance Tagged With: Budget, fashion styles, free online encyclopedia, happiness, latest gadget, law of supply and demand, material possessions, merchandise, purchase, Spending

401(k) and IRA Rollover – What To Do About That Retirement Money From That Old Job

November 13, 2011 By admin Leave a Comment

Whenever you decide to leave your job, you generally have four options for your 401(k) money:

1. Leave it there.
2. Roll it over into your new company’s 401(k) plan.
3. Roll it over into your IRA.
4. Take the money and run.

Choosing number 4 will never be the right move, as you’ll pay massive taxes, probably penalties, and receive significantly less dollars in your pocket that your ending plan balance. Furthermore, you’ll have a whole lot less growing for your retirement. So cross out number four.
Of course, that still leaves options one, two, and three, all of which are acceptable.

If you leave your old job and don’t move your money, in most cases you effectively choose option 1. However, you can still choose another option later. There is no deadline. However, if your plan balance is too low, you might not have the “do nothing” option. In this case, you must choose another option quickly, or your former employer might choose the complete distribution (option # 4) on your behalf, which would qualify as a big mistake.

Assuming your 401(k) money is still at your former employer, a few advantages exist to rolling over your 401(k) plan into an IRA. One benefit is the virtually unlimited investment options. When your money is in the 401(k) plan, your only choices are the investment options available from your employer’s 401(k) plan. This distinction is especially important if you desire additional investment options.
Another plus of an IRA rollover is simplification. Since you might have several jobs during your career, you might participate in several 401(k) plans. If you leave your money in each of these accounts, you have money all over the place. It is easy to lose track of these accounts as the years and decades go by.

Whenever you leave your job, I suggest either rolling over your 401(k) plan into your new employer’s 401(k) plan or rolling it over into an IRA. Doing so helps simplify your life because it gives you one less account to keep track of (if you leave it behind.)

Simpler is better because simpler gets done. Move your money where you know you will keep your eye on it. Invest an hour of time to roll over your 401(k) the right way when you leave your employer, instead of spending days trying to figure it out a few years later. Now that’s living Beyond Paycheck to Paycheck.

Filed Under: Personal Finance Tagged With: 401 k plans, Choosing, distribution option, employer, ira rollover, Money, number, old job, retirement money, track

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