Estate Planning Do's & Dont's

Money Jokes

A company, feeling it was time for a shakeup, hires a new CEO. This new boss is determined to rid the company of all slackers.On a tour of the facilities, the CEO notices a guy leaning on a wall. The room is full of workers and he wants to let them know he means business!The CEO walks up to the guy and asks, "And how much money do you make a week?" Undaunted, the young fellow looks at him and replies, "I make $300.00 a week. Why?"The CEO then hands the guy $300 in cash and screams, "Here's a week's pay, now GET OUT and don't come back!"Feeling pretty good about his first firing, the CEO looks around the room and asks "Does anyone want to tell me what that goof-off did here?"With a sheepish grin, one of the other workers mutters, "Pizza delivery guy from Domino's."

Financial Pitfalls : Part II

26. Not knowing yourself well enough to know you spending weaknesses
27. Not comparison shopping
28. Not understanding vehicle’s trade-in-values or depreciation schedules
29. Not setting aside money for maintenance of a vehicle
30. Not taking advantage of an employer contribution to a retirement plan
31. Buying too expensive of a car
32. Procrastinating on making important financial decisions like saving
33. Piling on the credit card debt
34. Not reading a lease thoroughly
35. Signing up for an extended car payment schedule. > 5 years
36. Giving out your Social Security number on the internet
37. Trusting the perception of establishment on the internet or an e-mail
38. Giving out your bank account number
39. Answering a solicited request over the telephone or e-mail
40. Answering chain letters to make money
41. Not getting business promises in writing
42. Not understanding technology enough to know deception
43. File sharing
44. Not archiving or backing up data
45. Buying without considering the service element on big-ticket purchases
46. Entering into service contracts (extended warranties)
47. Not having adequate health insurance coverage
48. Not realizing that if the deal is too good, then it probably is!
49. Being afraid to ask for advice
50. Falling victim to telephone scams

The World's Richest People

Financial Pitfalls - Part I

1. Not understanding the negative impact of compound interest

2. Being more concerned about the monthly payment rather than the

interest rate
3. Using payday loans
4. Not saving or paying yourself first
5. Buying too soon—when you want something not when you can afford it
6. Not having an emergency savings
7. Forgetting the peripheral costs of insurance, gas, & car maintenance
8. Signing up for cell phone monthly payments and getting stuck in a contract
9. Financing an education on credit cards instead of student loans
10. Becoming addicted to gambling
11. Trying at-home business scams with high startup fees
12. Not saving early enough in life for retirement
13. No understanding of how insurance works or what it covers
14. Not securing any insurance
15. Not factoring in late fees, extra charges, and taxes to a cell-phone plan
16. Having a “get rich quick” philosophy rather than a “get rich slow” strategy
17. Lack of budgeting
18. Bouncing checks and paying for overdraft fees
19. Paying for ATM fees when withdrawing cash
20. Following bad investment advice
21. Not knowing how to read credit card applications
22. Rushing into a buying decision without considering all options
23. Not knowing the financial consequences of DUIs, drunk driving, speeding, etc.
24. Making minimum payments on a credit card.
25. Having addictive and expensive habits or hobbies

Tips Buying on eBay

Will

A will is a written document which gives instructions how and to whom the will maker (testator) wants to bequeath his/her property after death. An oral will can be made only by members of military and merchant navy in active service when they don’t have time to execute a written will due to exceptional conditions like war.

Any person above 18 with sound mental health can make a will. It must be dated and signed by the testator and certain number of witnesses, depending on the laws of the state. A hand written will, called ‘holographic will’, valid in 25 states, does not require witnesses.
Though preparing a basic will is very simple many people neglect to prepare one thinking that the end is far away. Should a catastrophe strike a court will decide how the property will be distributed.

The right time to prepare a will is when you are in full control of all your mental faculties. Though wills made on the death-bed are perfectly valid, there’s a greater possibility of it being contested by a disgruntled beneficiary on the grounds of your mental inconsistency.
You can modify the will through a codicil that adds/removes certain provisions from the original will. You can also replace the original will by preparing and executing a new will. Change in your marital status, birth of a child, death of a beneficiary, substantial alterations to property, change of law or your desire to change the beneficiaries may require altering of will.

It is not necessary to notarize the will or to file it in court. Just keeping the document in a secure place and making it accessible to your executor will do. However, signing of an affidavit before a notary public by you and your witnesses will simplify the court procedure should the validity of the will be challenged.

If the value of your property is below the estate tax exemption limits ($1.5m), a basic will is all you need. It should give details of the persons/organizations to whom/which you want to bequeath your property; guardian(s) to manage the property in case you have minor children, and the executor of will.

What is Estate Planning?

Estate planning is one of the most important steps any person can take to make sure that their final property and health care wishes are honored, and that loved ones are provided for in their absence. Though often overlooked or put off in favor of more immediate concerns, a comprehensive estate plan can resolve a number of legal questions that arise whenever anyone dies: What is the state of their financial affairs? What real and personal property do they own? Who gets what? Does a personal guardian need to be appointed to care for minor children? How much tax will need to be paid in order to transfer property ownership? What funeral arrangements are appropriate?

What is an "Estate"?

Your "estate" consists of all property owned by you at the time of your death, including:

# Real estate
# Bank accounts
# Stocks and other securities,
# Life insurance policies,
# Personal property such as automobiles, jewelry, and artwork.

How Can an Estate Plan Help?

Regardless of your age, or the size and complexity of your estate, an estate plan can accomplish the following:

Identify the family members and other loved ones that you wish to receive your property after your death.

Ensure that your property will be transferred to those you have identified, as quickly and with as few legal hurdles as possible.

Minimize the amount of taxes that will need to be paid in order for your property to pass to others after your death.

Avoid the time and costs associated with the probate process by utilizing estate planning devices like living trusts and "payable on death" bank accounts.

Dictate the kinds of life-prolonging medical care you wish to receive should you be unable to make your wishes known when the time comes.

Set forth the kind of funeral arrangements you would like, and how related expenses are to be paid.

Brian Townley-Money Tips

# Week 1

# Week 2


# Week 3

Tips on Buying Life Insurance

Know what you need:
The classic and best reason for an individual to buy life insurance is for protection against dying too soon. The person buying life insurance should be primarily concerned with seeing that his or her survivors do not face a financial handicap. There may be other reasons that apply: Life insurance is also purchased to pay estate taxes. Business relationships often require life insurance or can benefit from it, for example. Annuities offer a secure way for consumers to make sure they don't outlive their money. Beware of anyone who tries to sell you life insurance as an "investment." Life insurance should be purchased for the protection it will give you.

Term life insurance:
Most consumer advocates feel that term insurance is the best life insurance buy. Term is different from "whole life" or "ordinary life" in that you build up no equity, or cash value. In term, you pay each year for the cost of insurance, which typically increases annually as your chances of being alive the next year decline. Most term policies are renewable on an annual basis, and some have level premiums or a decreasing death benefit for a stated period -- one, five or ten years, or even to a specified age.

Whole life insurance:
Whole, or "ordinary," life insurance is usually sold with a level premium. In the early years of the policy, the annual premium will be higher than comparable term insurance. (But because its premiums are level, whole life's annual premiums may eventually be less than term.) Whole life policies build up a cash value that consumers can withdraw or borrow against. There are many variations of whole life. Premiums may be payable for a specified number of years on a limited-payment basis. Consumers also may have the option of a single premium — paying all of the premiums at once with a single lump sum.

Know the company you are buying from:

You can check the financial stability of any life insurance company through several reputable national rating companies. Some ratings are available at websites.

Shop around for rates:
Life insurance is a competitive marketplace, and much of the competition focuses on price. Don't hesitate to seek premium quotes from several different companies.

Shop for your own needs:
If term insurance fits, that's what you should shop for. If you want to lower your premium at all costs, you may want to consider using a direct writer — a company that cuts costs by operating without agents. Consider your own convenience, however: Do you want personal contact with an agent? Or if you buy an annuity, how fast can you get to your money in case of an emergency? If you are buying whole life, how fast does your money accumulate? What will the cash value be in one year? Three years? Ten years?

Update your coverage as your circumstances change:
Don't be misled by someone who tells you you should buy additional policies for children as they are born. Children rarely have an income and seldom require life insurance. But your situation may change dramatically from year to year. Review your net worth every few years and reconsider the prospects your survivors may face if you die.

Don't let yourself get fast-talked into changes:
Some life insurance policyholders in recent years have fallen victim to a practice called "twisting" or "churning." Churning occurs when your coverage is changed only to benefit the seller even though you may suffer a loss in the process. Churning often happens when people with cash-value policies are persuaded to convert their coverage to another policy, often one with a promise of better benefits. The problem is that the cash value of the original policy is raided in order to pay for the new policy. Luckless consumers may not realize until years later that the "higher" benefit policy is actually worth only a fraction of the value of the original policy.
Never buy a policy you don't understand:
If you are given illustrations or booklets, save that material with your policy. If your agent or company cannot explain the policy terms to your satisfaction, shop elsewhere. Make sure you understand the guarantees in your policy (not just the agent's promises of returns) and the surrender penalties if you choose to drop the policy at any time. These costs are often hidden in a life insurance or annuity policy.

Mutual Funds

Deflation ??

by: Lou Stanasolovich, CFP. CEO & President of Legend Financial

Deflation, although uncommon since the Great Depression, normally occurs because there are too few customers chasing too many goods and services resulting in competitive price cutting that leads to layoffs, falling wages, and a decline in b usiness investment and consumer spending. Consumers and businesses project that prices will be lower in the future, therefore; they delay their purchases making the economic climate worse and driving prices and wages down further.

Households (decreasing wages) and companies (decreasing revenues) with extensive debt are still forced to meet their fixed monthly expenses. Often, bankruptcies result or spending is cut to meet their obligations. This is what happened in the early 1930ês triggering the Great Depression. Japan has faced for the past twelve years and continues to experience deflationary pressures as prices are falling. The forecast for 2003 is expected to be a decrease of approximately one percent per year.

This type of deflation is charac terized as –bad deflation.” On the other hand, price declines may occur when companies find ways to produce goods and services more cheaply. These productivity gains are passed onto consumers in the form of lower prices, onto workers as higher wages as well as onto shareholders as higher profits. This mild deflation may be considered –good deflation.” Some see a strong possibility of mild deflation developing in 2003, as the lackluster U.S. economy continues to face concerns over excess capacity, weak employment growth, high levels of consumer debt, and deflation being exported from the Pacific Rim countries. The combination of these factors could lead to mild deflation in 2003.

However, historically mild deflation alone has not been a negative to either the stock or bond markets. The last time that the year over year rate of change for the Consumer Price Index (CPI) ended down was in 1954 (-0.7%). If we face mild deflation (CPI flat to down 2.4%), have no fear. The 24 years of mild deflation since 1872 saw the stock market rise on average by 14.6%. When significant deflation occurred (CPI down 2.5% or more) stocks performed poorly with av erage total returns of just 3.9%. Periods of significant deflation are accompanied by a better –real return,” because the high deflation rate is added to the stockês performance. All deflation is perceived to be bad because it has been associated with past economic downturns. However, not all deflation occurs during economic weakness. Deflation may occur during the early stages of an economic rebound, particularly when b usiness confidence and inventory rebuilding advances ahead of consumer demand.

As the economy reverts back to equilibrium, these deflationary pressures typically ease. Stock market performance tends to be better during non-recession years when mild defl ation exists. Long-term interest rates are typically higher during high deflation periods due to weak economic conditions. Periods of deflation, whether mild or significant, usually tend to cause short-term interest rates to rise to levels somewhat higher than long-term average interest rates. In summary, while serious deflation is always of concern to everyone, historically, mild deflation will not necessarily prevent stocks from rising. However, not all periods achieve average returns either.

Buffett's Words of Wisdom

When you mention Benjamin Graham, Warren Buffett, and value investing in the same conversation, you're likely to get everyone nodding and going along with what you say. That's because agreeing with a philosophy is the easy part. But actually understanding and applying the approach of that philosophy is another story.

Aside from what he's currently buying and selling, Buffett has no investment-related secrets. It is my sincere belief that if you read Graham's The Intelligent Investor and Security Analysis, along with everything Buffett has written, and then work on truly understanding and applying their principles to investing, you will outperform 75% of investors.

Graham sums up how to invest intelligently when he says, "Investment is most prudent when it is most businesslike." Apply that reasoning to your investment considerations, and you will already have a head start. But to elaborate on that idea, let's turn to some words of wisdom from the Oracle of Omaha himself.

"I am a better investor because I am a businessman and a better businessman because I am an investor."

Running a business and making an investment go hand in hand. It's that simple. You wouldn't buy a business based only on rapidly increasing profits, nor should you invest in a company on that one metric. Instead, the prudent businessperson and the intelligent investor would scrutinize the balance sheet and determine, for example, whether earnings growth has been coming at the expense of increased receivables as a result of poor credit policy. Furthermore, as any businessperson realizes, earnings are easily manufactured, whereas cash is real.

Buffett's 1973 investment in the Washington Post (NYSE: WPO) is a wonderful example of a businesslike approach to investing. The idea was simple. The Post owned a wonderful collection of media assets that Buffett concluded were worth about $400 million. The company, meanwhile, was selling for just $80 million. Was it a great business? Yes. Was there a satisfactory margin of safety? Yes. Case closed.

"Never ask a barber if you need a haircut."

Here, Buffett was alluding to investment bankers and analysts. Let's face it: These folks get paid when you buy what they're selling. To be fair, there are many excellent investment bankers and analysts who truly offer a valuable service. Buffett's illuminating point was that you already know the answer you're going to get, and it will be determined by everything but rationality.

"I don't try to jump over 7-foot hurdles: I look for 1-foot hurdles that I can step over."

Buffett's critical advantage over the pack is that he focuses on the boundaries of his circle of competence rather than the size of his circle -- although his is still probably bigger than most. It's illuminating that one of the most talented investment minds of our time made the bulk of his fortune through businesses such as insurance via GEICO, soft drinks via Coca-Cola (NYSE: KO), candy, razor blades, and a host of others that are simple to understand.

"We don't get paid for activity, just for being right. As to how long we will wait, we'll wait indefinitely."

Buffett has always said you should never allow the stock markets to guide you, because the market is really there to serve you. One of Buffett's greatest attributes is that he can be patient about investments until the time is right, regardless of how long that time may be. In one case, Buffett waited nearly four years to make a significant move -- in 1970, he folded his partnership and made virtually no public-market investments until 1974, when the price-to-earnings ratio of the S&P went from around 20 to 7. At that point, Buffett began buying all over the place.

During that time, Buffett became famous for saying, "I was selling stocks at three times earnings to buy stocks at two times earnings." The approach worked: Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) shares rose from $40 to $420 per share from 1975 to 1980, for about a 57% annual rate of return!

"When a management team with a reputation for brilliance joins a business with poor fundamental economics, it is the reputation of the business that remains intact."

A truly great business can survive with mediocre management. You should always consider that at some point, less-than-stellar management will find its way to the helm of any business.
Words to invest by From just these few simple words, you can develop a good framework for successful investing. Simply focus on investing in great businesses that you can understand, and then be patient. Do what Warren would do.

By Sham Gad, September 14, 2007

Identity Thefft

Video
A 10-minute educational video that provides an overview of identity theft and outlines the steps consumers can take

Holiday $ales Fail to Get $hoppers to $plurge

By Parija B. Kavilanz, CNNMoney.com senior writer
November 25 2007: 4:20 PM EST

NEW YORK (CNNMoney.com ) -- Although deep discounts brought out much bigger crowds of holiday bargain hunters, a major retail trade group said Sunday that shoppers actually spent less money this year over the crucial Thanksgiving weekend. The National Retail Foundation's (NRF's) 2007 Black Friday Weekend Survey said more than 147 million shoppers hit the stores over the Black Friday weekend, up 4.8 percent from last year. However, the trade group said consumers, on average, spent an estimated $347.44 in total on Thursday, Friday, Saturday and Sunday, down 3.5 percent from the previous year.

The world shops America
The NRF's projection put a damper on some earlier estimates, including one from MasterCard Advisors on Friday that estimated Black Friday purchases to hit $20 billion this year, up from $19.1 billion last year. Also, ShopperTrak RCT Corp., which tracks sales at more than 50,000 retail outlets, said Saturday that total sales rose 8.3 percent to about $10.3 billion on Black Friday, compared with $9.5 billion on the same day a year ago. "While last year showed a greater emphasis on high-definition televisions, this year consumers were focused on lower-priced doorbusters like digital photo frames, laptops and cashmere sweaters," NRF CEO Tracy Mullin said in a statement. Industry analysts said retailers this year are especially challenged to drive sales in the coming weeks as many Americans struggle to find spending money amid the ongoing housing downturn and other economic pressures. "Though Black Friday weekend was a complete success for many retailers, the results of the holiday season won't be determined until the last two weeks of December," Mullin said. While many malls opened their doors to throngs of discount shoppers at midnight, several retailers, including J.C. Penney (Charts, Fortune 500) and Kohl's (Charts, Fortune 500), kicked off Black Friday as early as 4 a.m. this year.

http://money.cnn.com/2007/11/25/news/economy/nrf_blackfridayweekendsales/index.htm

Home Buying

The homebuying process can seem complicated, but if you take things step-by-step, you will soon be holding the keys to your own home!

Step 1: Figure out how much you can afford
What you can afford depends on your income, credit rating, current monthly expenses, downpayment and the interest rate.

# How much home can you afford?
# Buying vs. Renting

Step 2: Know your rights
# Fair Housing: Equal Opportunity for All - brochure
# Borrower's rights
# Predatory lending

Step 3: Shop for a loan
Save money by doing your homework. Talk to several lenders, compare costs and interest rates, negotiate to get a better deal. Consider getting pre-approved for a loan.

# Looking for the best mortgage: shop, compare, negotiate - brochure

Step 4: Learn about homebuying programs
# Good Neighbor Next Door (formerly known as Teacher/Officer/Firefighter Next Door)
# Homeownership for public housing residents

Step 5: Shop for a home
# Choose a real estate agent
# Wish list - what features do you want?
# Home-shopping checklist – take this list with you when comparing homes

Step 6: Make an offer
Discuss the process with your real estate agent. If the seller counters your offer, you may need to negotiate until you both agree to the terms of the sale.

Step 7: Get a home inspection
Make your offer contingent on a home inspection. An inspection will tell you about the condition of the home, and can help you avoid buying a home that needs major repairs.

Step 8: Shop for homeowners insurance
Lenders require that you have homeowners insurance. Be sure to shop around.

Step 9: Sign papers
You're finally ready to go to "settlement" or "closing." Be sure to read everything before you sign!

Investing Books

The Intelligent Asset Allocator, by William Bernstein

William Bernstein is one of today's most unlikely financial heroes. A practicing neurologist, he used his self-taught investment knowledge and research to build a popular investor's website. Now, in the plain-spoken The Intelligent Asset Allocator, he shows independent investors how to build a diversified portfolio-without the help of a financial advisor.

A breath of fresh air for investors tired of overly technical investment tomes, this book will help investors:

Learn the risk/reward characteristics of various investment types.
Understand and apply portfolio theory for an improved risk/reward ratio.
Sharpen their focus, and take control of their investment programs.
William Bernstein (North Bend, OR) runs a website-www.efficientfrontier.com-known for its quarterly journal of asset allocation and portfolio theory, Efficient Frontier.

Eat the Rich, by P. J. O'Rourke

The best investing book in the marketplace on how the world works. It's so entertaining, that it's usually found in the humor section, not the economics section, of the bookstore. Disguised in all the fun is a powerful dissertation on why freedom creates incredible wealth. When you're done, do your part to save the future of the world - give it to your favorite bleeding-heart college kid.

Islamic Finance

Old Age

Misconceptions about Retirement Planning

My expenses will drop when I retire.

My retirement will only last 15 years.

I can depend on Social Security and my company pension to pay for my basic living expenses.

My pension benefits will increase to keep pace with inflation.

My employers health insurance plan and Medicare will cover my medical expenses.

There’s plenty of time for me to start saving for retirement.

Saving just a little bit won’t help

Lets think for a while..

If from age 25 to 65 you invest $300 a month (9% interest-annual) at age 65 you’ll have 1.4 million in your retirement fund.

Wait ten years until age 35 to start and you’ll have about $550,000 at age 65.

Wait twenty years until age 45 and you’ll have only $201,000 at age 65.

Children and Money

Parents can help children become effective money managers and responsible buyers by teaching them money management skills from an early age. Financial education should be based on the needs, interests, and abilities of each child. The following guidelines may be helpful for parents:

Under 5. Around age 3.
You can start talking to your children about money. Use a piggy bank to teach how to identify and count coins and cash. Between 4 and 5, you can explain the importance of good savings habits. Help them learn that saving for a specific item and then buying it gives great satisfaction. Take your child to the store to actually see a toy he or she saw advertised. Together, examine the toy and decide if it can really live up to the promises made in the commercial. Children at this age are quite aware of commercials and sing the jingles they hear on the television and radio. Begin talking with them about the financial realities of the family and how choices are made.

Ages 5 to 10.
When children start school is a good time to give an allowance and open a savings account. You can teach them to plan the use of their money, whether from allowances or money gifts. You can also suggest that they can earn extra money by doing additional household jobs. When children begin spending money you can help them analyze their decision making. They will learn that there are consequences when we make poor decisions and that it is important to prioritize needs and wants.

Ages 11-14.
When children enter adolescence they are concerned about what their friends are doing and buying. Consequently, they tend to adopt the spending patterns of their peers. It is a good time to demonstrate the importance of comparison shopping when you buy goods and services. During this time many teens find jobs such as baby-sitting, lawn mowing or snow shoveling. They can save the money they earn or spend it for extras such as clothing, accessories, and CDs. It is important that they have control of their money because their financial successes and failures will become valuable learning experiences.

Ages 15-18.
These are difficult years when teens are trying to become independent but are still financially dependent on their parents. This is the time to seriously discuss savings for long-term goals such as college or a car. To obtain these goals many teens have part-time jobs such as fast-food restaurant workers, salesclerks, or cashiers. During their senior year in high school, some students obtain a checking account and/or a credit card to be used in college.


Spending Plan

A spending plan can encourage children to be careful money managers. The following topics can be discussed:

# identify income, including allowances and gifts
# set goals based on needs and wants
# determine expenses, both fixed and flexible
# develop a spending plan
# revise the spending plan as needed

Financial Literacy in Campus

How to Reduce Credit Card Debts

The Richest Man in Babylon

George S. Clason first published The Richest Man in Babylon in 1926. Told as a collection of narratives set in ancient Babylon (supposedly the wealthiest city in the history of the world), the book stresses simplicity and common sense in the management of one's finances. The tales in Clason's book swirl around a group of simple characters differentiated by class — that is, those characters who are in difficult financial straits (and are looking to find a way out) take it upon themselves to meet with a few of their notably affluent fellow citizens. They then inquire as to the basis of the affluents' riches. There are few complicated remedies espoused by the Babylonian "financial gurus." Rather, these are the absolute basics of successful personal finance. Readers will see these same tenets rehashed and rephrased in just about every other personal-finance book out there.

FIRST CURE: Start thy purse to fattening.
The stream of money that flows into and out of one's life is immense. Wealth and security can be secured from it, but only if portions of that stream are diverted. Time and again, the book's "enlightened" characters stress saving at least ten percent of your income every month, without fail. Accomplish this by setting aside that ten percent before all other expenses are considered.
"But when I began to take out from my purse but nine parts of the ten I put in," Arkad said, "it began to fatten. So will thine."

SECOND CURE: Control the expenditures.
The amount of money a person makes is important, but it is secondary to the degree to which that person controls his expenses. Budget and plan your expenses earnestly. Demand value for the dollars you spend. "That what each of us calls our 'necessary expenses' will always grow to equal our incomes unless we protest to the contrary," Arkad stated. "Confuse not the necessary expenses with the desires."

THIRD CURE: Make the gold multiply.
Three words: interest, interest, interest. Take care to see that all saved monies are kept in the highest-yield interest-bearing accounts available. If you have the experience and education to do so, invest a portion of your money by other means, always striving to create a reasonable risk/reward ratio. "A man's wealth is not in the coins he carries in his purse; it is the income he buildeth. That is what thou desireth: an income that continueth to come whether thou work or travel."

FOURTH CURE: Guard the treasures from loss.
Forget about gunning for those astronomical returns promised by market gurus and their "hot tips." And don't bother with those wacky startup businesses you see boxed in the classified ads, either. If you're going to take risks and invest your money, then make sure you have the education to know how to guard and protect your assets. Only you can keep your best interests at the forefront. Your savings control your future; treat them like it. "The first sound principle of investment is security for thy principal. The penalty of risk is probable loss. Study carefully, before parting with thy treasure, each assurance that it may be safely reclaimed. Be not misled by thine own desires to make wealth rapidly."

FIFTH CURE: Make of the dwelling a profitable investment.
In most cases, home ownership — even when financing is included — is preferable to renting. At some point, the mortgage payments will end, and ownership will be achieved. There is no ownership for the renter ... ever. "Thus come many blessings to the man who owneth his own house. And greatly will it reduce his cost of living, making available more of his earnings for pleasures and the gratification of his desires."

SIXTH CURE: Insure a future income.
The future cannot be known, but preparations can be taken to assure a certain level of financial safety. Whether this is done via a strict savings plan, outside insurance, or a combination of both, one must be careful to provide for the wellness of himself and his loved ones in later years. Disability and untimely death have caught and ruined families and their finances since time immemorial. "No man can afford not to insure a treasure for his old age and the protection of his family, no matter how prosperous his business and investments may be."

SEVENTH CURE: Increase the ability to earn.
Last among Clason's "cures" is action taken to increase one's earnings. Acquire education, experience, and confidence in yourself, and use these things to improve your income. You might begin a second, part-time job, or simply freelance your abilities in your spare time. Whatever you do, never underestimate the opportunity to turn a favorite hobby or skill (woodworking, photography, home decorating, cooking, etc.) into extra income. "The more of wisdom we know, the more we may earn. The man who seeks to learn more of his craft shall be richly rewarded. Cultivate the own powers, study and become wiser, become more skillful, and act as to respect theself."

http://www.mdmproofing.com/iym/sevencures.html

Slashing your Grocery Bill…

By Adrie Roberts, Utah State University Extension :

• Bulk buying. Purchasing sale items or good deals in stores you seldom shop, in quantities to get you through to the next sale.
• A price book or system to keep track of prices between various stores.
• Elimination of non-nutritious foods such as soda pop, ice cream, and candy.
• Elimination of convenience foods (especially foods packaged in single-serving containers).
• Choosing less expensive food. This includes tuna, powdered milk, cheaper vegetables and fruits.
• Buying store generic brands.
• Vegetarianism. Cut back on meat and substitute dried beans and whole grains.
• Portion comparison. Instead of comparing boxes of raisin bran, compare raisin bran to oatmeal or pancakes or instead of buying steak when on sale compare portion price to that of chicken.
• Free food. Garden surplus from neighbors, wild berries, food obtained through barter.
• Preparing foods from scratch.
• Maintaining optimum weight. Since your metabolism increases the more you eat, reducing your weight can make a significant difference on your food bill.
• Waste nothing. This includes making sure that children finish meals, cooking a turkey carcass for soup stock, and eating leftovers.
• Eat fewer meat and potato meals. Casseroles, soups, stews, stir-fry meals, etc, are generally less expensive – and better for your health.
• Experiment making your own mixes. Instant non-fat dry milk in mixes makes the mixes very economical to use. Take one day or evening and make several mixes at once.
• Use your food storage. Change your thinking to using your “food supply” rather than your “food storage”.
• Shop alone after you have eaten. Statistics indicate that people buy more when they are hungry or accompanied by others, especially children. Stay on the outer edges of the store. Inner isles have pre packaged high fat foods that your body and checkbook can do without.
• Plan meals in advance according to grocery store ads.
• Use unit price data. Compare the cost of similar products of various sizes by weight, volume, or count. Check to see if larger quantities are more economical than small ones.
• Be a brand switcher. Different brands of the same product can be roughly equal in quality and nutritional value yet varies widely in price. Experiment with the products carrying store labels.
• Learn nutritional alternative. Study up on the nutrients essential for health and what foods provide them. Protein, for example, comes in many forms. A meal containing beans, rice, whet, corn, or milk can be as rich in protein as one featuring sirloin steak. Read labels, compare values.
• Try new meats. Grains for cattle feeding are expensive in relation to the amount of meat produced. Meat from grass-fed cattle and calves is less expensive and is more healthful since it has less fat. Since it is leaner, it shouldn’t be cooking too long or at too high a temperature.
• Try cheaper cuts. Learn how to cook these cuts. Though the taste is different, you might be pleasantly surprised. Try marinating a cheap cut instead of using the more expensive piece packages expressly for a certain dish.
• Buy the serving. Don’t ignore the more expensive boneless cuts of meat. Though bony meats are cheaper per pound, they yield less edible meat per pound.
• Get out of the rut. Get out the cookbooks and try something new. Consider making form scratch many of the things you habitually buy in prepared form.
• Attend cooking classes that are held locally for new ideas. Insist on freshness. The date marked on all perishable foods is the “pull date”, the last day on which the product can remain on the shelf in the store. It is not a spoil date. You may be able to get a discount on these items.
• Buy quantities you can use. Large quantities are often bargains, but only if they will keep safely until you can use them up. Store them properly.
• Buy fresh fruits and vegetables at their peak season, when prices are usually lowest.
• Consider group strategies. A neighborhood group might save by buying in build directly from wholesalers and farmers. Or a shopping club could check the ads for specials, then send members on shopping trips to different stores to buy for the whole group. Some stores will honor other stores’ sales or promotional items.
• Save on cereals and baked goods. There are two benefits in buying unsweetened cereals. They cost less than sweetened cereals, and you can control the amount of sugar you or your children consume.
• Save on milk and eggs. Nonfat dry mild commonly costs about half as much as the wet variety, and you can use it for cooking or for drinking. The distinct taste of nonfat dry milk when used in cooking is hard to detect. Determine which of any two sizes of breakfast eggs is the better buy.
• Drink more water!
  
  Make your family more financially fit, and physically fit!

You Can Handle The Truth Money : Money as Debt

Part 1:


Part 2:


Part 3:


Part 4:


Part 5:

Loans

When you borrow money or take on credit, whether through a credit card or a bank loan, it's important to understand interest because it can vary from company to company, and can be quite costly.When evaluating debt, list it in order of highest rate to lowest.

Money...money..money..

Are you a balanced spender/investor or are you a Binge Spender? A Big Spender or a Micromanager? Take this fun quiz to find out which money personality best describes your style of money management. You may find that two or more answers to some questions seem correct in describing you. In that case, select the answer that is most like you. Keep in mind that everyone is a blend of all the major personalities and that each type has both good and bad qualities to it.

http://myvesta.org/tests/moneypersonality/

You Could Live in The Top 2% of America!

But what does this mean?

• Having enough income to live the life you want. No longer worrying about day-to-day expenses and knowing that you and your family will have enough to maintain that lifestyle in the future.


• Being physically, mentally, and spiritually healthy. Feeling energetic and alive at any age.


• Having happy and rewarding relationships with family, friends, and colleagues. Being fully engaged and passionate about life, facing every day with a feeling of expectation and excitement.
  

It’s no wonder only 2% of Americans enjoy this lifestyle. It just doesn’t happen. It takes learning the specific skills that are present in all high achievers. Sadly, these are not the skills taught in our nation’s schools and universities.

By simply taking this test you are already ahead of the pack. You are taking the time to learn about yourself and steps you can take to “Live in the Two.” Our experts have identified five distinct categories, or character traits, that ultimately determine the likelihood of one's achievement. Based on your responses to our survey, the following profile has been customized to describe your current life situation. Read your profile below...

Discipline
While hard work is certainly instrumental in attaining success, it is useless without discipline. Discipline is the ability to set goals, manage one's time, measure results, and maintain overall balance in life. Although you don't think of yourself as the "anal-retentive" type, others have a tendency to view you as "over the top" organized. Little do they know that secretly, you feel as disorganized as the next guy.

Passion
It's more than just hard work, it's holding on to the dream. Though life comes at you hard sometimes, every person must have an instinct to press on and dream big. Regardless of what you do, it is only success when you have done your best. Although you are always enthusiastic about your goals, you also tend to be practical in your approach to accomplishing them. All passion can lead to disaster without the proper forethought.

Risk
Risk is not always a matter of rolling the dice, and in this case, our goal is to measure one's willingness to step out of the "comfort zone." Success often requires change, and the road is often paved with new challenges that defy complacency. While you're always up for a good adventure, you've learned to wisely temper the thrills with a bit of discretion. You've undoubtedly had a few failures that have made you less likely to "dive in without testing the water" first these days.

Optimism
"You are what you think about," so the saying goes, and it is no surprise that happy people are, well, just happier. This category of optimism includes both internal and external sources of positive affirmation (i.e., self-esteem, confidence, self-image, spiritual acuity, etc.). If positive outlook is a requirement for success, then you seem to have the world by the tail. Without being boastful, you have a genuine sense self, and find value in being yourself. You are a pleasure to be around and find your time in high demand by others.

Interpersonal Skills
Relationships are pivotal to overall success, and that not only includes personal relationships, but also the ability to deal with people. Negotiating. Selling. Public speaking. Regardless of your trade, these factors are all necessary for ultimate success.
Face it, you're just not an extrovert, and depending on your career track, that could be a problem. While you do enjoy a certain amount of interaction with people, you're most comfortable in small groups or one-on-one.

In conclusion...
If you’re like most people, you have just learned a few things about yourself, and probably confirmed some that you already knew. And while gaining insight about yourself is interesting, it is only valuable if it used to improve your life. The truth is, of the thousands of people who take this test, only 2% will ever use these test results to live a life of fulfillment. The rest will simply make excuses. “I don’t have enough education.” “I’m too old.” “I’m too young.” “I’m just not lucky.” “I’m not smart enough.”

For 50 years, we at Nightingale-Conant have been helping hundreds of thousands of people reach their full potential - people who were no different from you, except for maybe on thing - they believed that their past didn’t predict their future.

Find times to explore your own self. Mr. Dollar would recommend you to try and visit the attach website. Kudos !!!

http://www.liveinthetwo.com/test/

Credit

Investing 101

Investment Planning

The process of placing money in some medium such as stocks or bonds in the expectation of receiving some future benefit. Speculating – a form of investing in which future value and expected returns are highly uncertain.

The Most Frequent Investment Objectives :

• Enhance current income
  
• Save for major purchase
  
• Accumulate funds for retirement
  
• Seek shelter from taxes

Establishing Investments Goals :

• What will you use money for?
  
• How much money do you need to satisfy your investment goals?
  
• How long will it take you to obtain the money?
  
• Are you willing to make the sacrifices necessary to ensure that you meet your investment goals

Factors Affecting The Choice of Investments:

• What will you use money for?
  
• How much money do you need to satisfy your investment goals?
  
• How long will it take you to obtain the money?
  
• Are you willing to make the sacrifices necessary to ensure that you meet your investment goals

Life Insurance

What happens when something goes wrong and there's a cost involved to make it right again? If you have a car accident, how will you pay for repairs? If your family need hospitalization, how you will pay for it? If you property is damaged of if you get sued for damaging someone else's property, how you will cover the cost?

You never know when financial catastrophe might strike. Let's think about it !!!!

Financial Fitness Calendar

Interested in long-term financial security? Consider giving yourself the gift of financial fitness all year long. Unfortunately this gift does not come neatly gift wrapped with a big, pretty bow. You must work hard to make this gift a reality. You may even have to make sacrifices such as fewer meals out, less money spent on clothing or entertainment, or driving your car another year.

How do you get started? Consider the following suggestions from Clemson Cooperative Extension in South Carolina:

January: Get on the financial scales and create an overview of your financial situation. What do you own and what do you owe (your net worth)? How much income comes in and where does it go?

February: Keep an expense log for several months. Compare expenses with income. Income should exceed expenses or you are headed for financial trouble.

March: Reduce clutter in your financial life. Keep only important receipts, records, and papers. Instead of using the "stash and pile" method of organization, use the "file It, find It" approach.

April: Trim your taxes. Track all deductions, contribute the maximum to tax-deferred retirement plans (e.g., 401(k)s) and evaluate potential tax credits. Meet the April 15th deadline or file for an extension to avoid penalties.

May: Reduce expenses and debt. Curb the temptation to spend more than necessary and avoid the overuse of credit. Get in the habit of "smart spending." Before making spending decisions, ask yourself, "Is what I am getting today worth the money I lose for future goals?" And remember, using credit does not extend your income, it only adds to your debt.

June: To ensure steady, healthy growth of your net worth, use the savings strategy, "pay yourself first." Establish a regular savings plan and consider it one of a major bill to pay monthly.

July: Exercise the best insurance options. Review all coverages. It is a good idea to compare your company's coverage with that of two other companies to be sure you are getting the best protection for your money.

August: Now that you have a good understanding of your resource base, you are ready to begin working on establishing long-term financial goals. Identify your long-term goals, attach a dollar value to them, and develop a plan to achieve them.

September: Choose a savings or investment plan to help you reach long-term goals. Explore options available through your employer and financial institutions.

October: Make dinnertime a special time. Share money management skills with your children and encourage them to save and invest for their financial future.

November: Keep your financial health in good order, even if you become physically ill or incapacitated. Execute a living will, health care power of attorney, general durable power of attorney, and will.

December: Distribute good will to family and friends and share your bounty with others. Give wisely to charities. Be sure the charity is reputable and know what they do with the money collected.

Source : Rutgers

You Can $tart $mall

It's myth that you need a lot of money to invest. The truth is you can start small, and in many cases do it through payroll deductions, so it is systematic and painless. If your company has a payroll deduction plan, you can designate an amount of your paycheck that will go to a savings account or other instrument. You never see it, so you're not tempted to skimp on your savings.

When you invest money, you're really lending it to a bank, a corporation or a government in exchange for a promise that the borrower will pay it back with interest. Just as using credit is like "renting" money, saving and investing are like being the "landlord" of your money. You "rent" it out to others.

Warren Buffett said :

"The investor of today does not profit from yesterday's growth".

http://simulator.investopedia.com/

The $ecret to Creating Wealth

The Financial Planning Proce$$

1. Determine your current financial situation.
2. Develop your financial goals.
3. Identify alternative courses of action.
4. Evaluate your alternatives.
5. Create and implement your financial action plan.
6. Review and revise your plan.

Components of Financial Planning

• Obtaining
• Planning
• Saving
• Borrowing
• Spending
• Managing risk
• Investing
• Retirement and estate planning

Be A Millionaire

Topic$ for Talk

How well and how often do you work money management topics into daily conversations with your kids? Here's a chance to evaluate your efforts.

Don't avoid talking about money just because kids are young. Simple lessons about money should start early in your child's life and become more complex as your child matures. For example, with very young children, you can use grandparents to begin to talk about retirement. Let's consider how you might talk to kids of different ages about a Rainy Day fund.

Very young child: You might say that "extra money" works like an umbrella that keeps you dry in a storm. You've got it when you need it. Talk about how having change in your pocket enables you to buy a juice when you're thirsty.

Slightly older child: You might talk about a "just-in-case" fund used to get out of minor trouble. Good thing I had some money in my pocket because I couldn't find my movie ticket, and I had to buy another one.

Older child: Kids around 10 should begin to understand that you save for unexpected events. You get a flat tire that's too damaged to repair. You need money on hand to buy two new ones.

A teenager: Teens should know that such a fund gives you the security to live without borrowing when the need for money arises. The refrigerator cannot be repaired and you must buy a new one. Because you have the money, you don't need to pay interest on a loan in addition to paying for the cost of the fridge.

College student: These young adults should understand that money gives you a feeling of security in a world of more complex situations where anything can happen, including losing your job.

How well do you think you are doing? What money-related topics do you talk about?

Source : themint.org

Your Money & Your Mate

ABC's Financial Planning

Goal $etting

Goals are the foundation for plans of action. They often are personal, but can be professional as well. It is good to set both long-term and short-term goals. A long-term goal might be saving money to go to college. Setting and achieving goals can be easy if you set SMART goals.

SMART goals have 5 characteristics

Goals must be....

• Specific: "Get out of debt is too boroad,while pay off your credit card is specific."
  


• Measurable: "Paying an extra $30 a month towards your credit card is measurable --- you can see each month that you are working towards your goal."
  


• Attainable: "If you pay an extra $30 a month, can you reach your goal? "
  


• Realistic: "Is it possible to pay off your credit card?"
  


• Time bound: "Paying off your credit card has no time frame, but paying off your credit card in the next 12 months has a deadline."
  

Our priorities influence our goals, what we do with our time, and even how we spend our money. We have many goals and a limited amount of time in which to accomplish them. Therefore, it is important that we develop a plan to help us achieve our goals.

Financial planning is an ongoing process that changes over time, especially when major changes happen in one’s life, such as going to college or buying a home.

How Much Ri$k Do You Want To Take?

Here are some things to think about when determinating the amount of risk that best suits you.

Financial Goals

• How much money do you want to accumulate over a certain period of time? Your investment decisions should reflect your wealth-cretaion goals.

Time Horizon

• How long you can leave your money invested? If you will need your money in one year, you may want to take less risk than you would if you won't need your money for 20 years.

Financial Risk Tolerance

• Are you in a financial position to invest in riskier alternatives? You should take less risk if you cannot afford to lose your investment or have its value full.

Inflation Risk

• This reflects savings' and investments' sensitivity to the inflation rate. Some investments such as savings account have no risk default, there is risk that inflation will rise above the interest rate on the account.

Debt Rate

Debt rate = Total monthly debt payment/Monthly take-home pay

Example: If your total monthly debt payment is
$200 and your monthly take-home pay is $1,200,
what is your debt rate?
$200/$1,200 = 16.6%

• 10 percent or less
Congratulations! You are in the safe limit
and probably feel little debt pressure.

• 11 to 15 percent
You are in the safe limit but you may feel
some debt pressure. Be cautious about taking
on more debt.

• 16 to 20 percent
You are probably hoping that no emergency
arises. Start working on reducing your debt.

• 21 to 25 percent
You are probably worrying about your debt
load. It is time for a dramatic change. You
may need help from a credit counselor.

• 26 percent or more
You definitely have more credit than you can
handle. You need professional help
immediately to reduce your debt.

Fact$ & Figure$

How to $tay Disciplined with Your $avings

• Just do it! Pay yourself first!

• Gather all important financially-related documents and receipts to a central location. File them so you will be able to easily find the items you need in the future. Consider a computer based financial program so you can keep track of every dime you spend – financial control is a special form of power!



• Spending every dime and more? Start by cutting back on a few items per week and putting away that money. Pay yourself first. Just say no to spending more than you have.

• Ask for direct deposit at work if they offer it – you’re saving money, and you don’t even see it. A savings plan at work that pays you a “matching contribution” is the fastest way to save. Pay yourself first!
  

• Do not use credit cards. Force yourself to pay cash so that you can track the dimes. You will never have a late payment (now as much as $75) and you will never pay interest to others at the very high rates credit cards charge.
  
  
• Financial freedom will be worth everything you put into it. Don’t want to work forever.
  

How Much Doe$ a Cup of Coffee Co$t you?

If you buy a cup of coffee every day for $1.00 (an awfully good price for a decent cup of coffee, nowdays), that adds up to $365.00 for just one year. If you saved that $365.00 for just one year, and put it into a savings account that earns 5% a year, it would grow to $465.84 by the end of 5 years, and by the end of 30 years, to $1,577.50.

Source : http://www.sec.gov/

Tips for $ticking to Your Financial Plan

Making changes is challenging. It’s difficult to adopt new ways of doing familiar tasks. Making financial changes in a family is no different. It requires thoughtful, realistic planning, goals that reflect family priorities, time to refine and evaluate progress, and determination keep working long enough to see results. As you begin to make financial changes, choose some tools to help make it easier. Make a list of questions to ask yourself before making purchases.

• Will this purchase help me reach my financial goals?
• Is this purchase listed on my spending plan? Can I do without this item, at least for now?
• What will I have to give up if I spend my money on this purchase?
• Do I need this item or do I need this money for one of my financial goals?
  

Make your spending plan part of your daily life. If you have a goal to save $50, look for ways you can spend less today. Cut out a snack, bring your lunch from home or pass up magazines at the grocery store. Tell someone else what you are doing and ask for their support. Write your plan down so it is clear in your mind. Break large tasks or goals into smaller pieces and work on them step by step. Plan for new situations and changes. Look ahead for increased expenses as a child enters school or the washer needs to be replaced.

Plan large expenses so they occur over several years. New carpet this year, a new refrigerator in two years, a new car in five years. Keep your spending plan where you can refer to it as you make purchasing decisions. Develop a record keeping system. Allow yourself a special treat for successfully following your plan.

RESOURCE: Successful Money Management (EC 428.1-4) by Dr. Barbara Rowe with Kay W. Hansen and Marsha M. Peterson, Utah State University Cooperative Extension Service, November 1990.

Money About$