Archive for February, 2010
February 27th, 2010 | 
Author: The philosophy of planning for the future has always confounded me. It seems to me there are two very basic world views in conflict when this issue is raised. One world view is the responsible response: the “planning for the future” type of person. This type of person seems to think he will live to be at least 100 years old, and that everything he refrains from enjoying, doing, or buying now will pay off as millions of dollars in that inevitable and very real place called the future.
Then there is that other sort of person that believes that nothing can be as wonderful as the fun that a person can have right now. Since I can’t “take it with me”, as they say, I might as well “eat, drink and be merry” right now.
I myself don’t adhere to either of these points of view. I have a tendency towards not missing opportunities today that might never come again, such as spending money, perhaps more than is wise, on a meaningful activity with my family which will become a wonderful memory to cherish for years to come. In many ways this type of spending is actually a type of investing; in the future of the health of my family. The relationships we develop with our loved ones must be worked on now, and not at some obscure future time. Remember Harry Chapin’s famous song “Cat’s Cradle?” This song illustrated the well-known “tomorrow” syndrome in a poignant and heartbreaking way. The mistake we all have a tendency to make when we tell our children “we’ll get together when I have time.”
Of course, on the other hand, quality time with our families does not always require large sums of money. Sometimes the inexpensive or free moments can be the best. But sometimes a really great time for everyone might require some money spent, and if so, sometimes it might be wise to say, “the future is now.”
Then again, if we are lucky, and we live a long time, long enough to retire and do some of the things we just couldn’t do when we were working 40 or more hours each week; when our children needed a lot of tending to and all the other things that get in the way of traveling, hobbies we love, enjoying long walks, or whatever it may be, it might be nice to have a bit of money to enjoy that time without worry.
So in conclusion it appears to me that the correct approach to this dilemma is to strive towards a responsible savings plan to ensure a worry-free and active retirement, while at the same time keeping our options open for some “irresponsible” spending today, while we still have our good health and our young children around to enjoy ourselves together with them. It is true you can’t take it with you, but it is also true that one day the future will be here and you will be happy that you were prepared and ready to meet it in style.
Emily Salisbury, the author of this article, writes about crafts, cooking, and home decorating. Her creative skills are far more developed than her financial skills, so she turns to professionals for investment advice.
Putting together a savings plan she could live with wasn’t easy, so Emily looked for a reliable investment adviser. Harry Rady of Rady Asset Management came highly recommended and helped her to make a plan that lets her enjoy her life now while planning for a secure retirement.
Article Source: Saving For the Future While You Enjoy the Present
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These are not good economic times for a lot of people. And if you are near retirement or are already there, your ‘nest egg’ probably has diminished. Consequently your current (or projected) income level has dropped and the length of time it will last is reduced.
If your fund sources are in securities, no doubt the values have decreased. And when market conditions start to turn around (historically they have), how long will it take to get back to where you were before securities or other investment values headed south?
If you’re young enough and have the time for your investments to recover, hopefully you’ll be able to regain your losses and head back up a path of respectable returns on your investments. If you don’t have the time, you may be searching for ways to make up losses including cutting expenses.
There are a number of financial products at your disposal to consider. Stocks, mutual funds (both of which over a period of time generally do perform well), bonds, precious metals and even real estate (although now is not the best of times), and numerous other options. Certificate of Deposits (CD’s) and money market vehicles may not provide much of a gain, but they are very popular and have their place in overall planning.
Another option to review is an annuity. These plans include variable or indexed annuities which have become popular as accumulation vehicles with options to withdraw money for retirement purposes. Both of these types of plans have the potential for gains or losses but also have features that can protect downside risk. Results are tied into various security options or indexes. Fixed annuities provide a return based on the investment results of the general account of the insurance company issuing the policy.
One annuity product that may be considered to some as being ‘ho-hum’ or ‘boring’ is the Single Premium Immediate Annuity (SPIA). The boring part is that there is generally no potential for increases in value, no access to cash values, and no increases in the levels of income it provides.*
However, what is not boring is that the income received from a SPIA has guaranteed life time income options (or for a specified period of time) for individuals or for two people under a joint income annuity. And if an individual (or even two people under a join annuity) have serious health issues, many insurance companies will actually increase the normal level of income compared to what a healthy person would have received.
So who might consider this type of an annuity? Anyone who wants or needs a guaranteed income in addition to their monthly check from Social Security or other income sources they may receive. The SPIA may be the ‘bond’ vehicle in a total portfolio of mixed investments. Depending on age and personal financial goals, some advisors may suggest 10% to 20% of investments used for retirement income might come from a SPIA. Each situation will be different and requires a review of personal goals, obligations, and other financial considerations. Longevity should also be considered.
Another feature of SPIA income is that due to a special formula called an ‘exclusion ratio’, federal income tax due on the income received can be less (over a number of years) than other types of investment income. This special tax treatment applied to money received from non-qualified money sources, not qualified funds (i.e. pension type plans).
We’re all getting older and generally living longer. One concern may be that of outliving your money. Another is the cost of long term care which many of us will require sometime in our lives. For a 65 year old retiring today, its estimated there will be an additional cost of $250,000 for health services needed over and above any benefit plans we may have in place, either personally owned or provided by the government.
Current Nursing Home care in North Carolina is $5,569 per month for a private room (and doesn’t included drugs and other incidentals). An Assisted Living facility (private room) is $2,395 per month. Most people, if in fairly good physical and mental health, would prefer to stay at home. If assistance is required, an un-certified aide’s fee is $18.00 per hour for their service. (Source: Genworth Financial 2008 Financial Cost of Care Survey)
These costs are increasing higher than the national inflation rate. If a family member or friend is going to assist at home, the cost of lost wages and their own well being can be greatly affected. Purchasing Long Term Care insurance while healthy is a good option to help pay for a major part of long term care expenses. These costs can run into many thousands of dollars (and that could be from your retirement/investment money).
A Single Premium Immediate Annuity (SPIA) can also be an option to pay for Long Term Care insurance premiums. A one time single premium is paid which equals the income level required to pay for the Long Term Care insurance premiums. ** For example, if two spouses each own a Long Term Care insurance policy (and are joint annuitants under one SPIA), and one of the spouses die before the need for long term care occurs, the addition income from the annuity (required to pay for the deceased Long Term Care insurance policy) is now available for other uses to the surviving spouse.
What ever type of saving vehicles you might be using for accumulation or income purposes, diversification of investment choices will generally be important, particular in today’s volatile markets. A Single Premium Immediate Annuity is an option to consider when guaranteed income is needed. And actuarially, people live longer who receive guaranteed income from annuities. What Will Rogers said in the 1930’s still applies considering today’s investment atmosphere. “I’m not so much interested in the return ON my money as I am in the return OF my money.” A SPIA may be the right option.
*Some companies offer SPIA’s with access to values and increased income levels.
** Long Term Care insurance premiums may be subject to future increase.
Article Source: Has Your Nest Egg Cracked?
We all know that we should save money. But something so easy to say can be quite difficult to actually do.
Saving money is the basis of building your financial future. However, many consumers are putting it off one more day. Those days turn quickly into years of lost money. Without savings, the chances of meeting long-term financial goals and achieving financial security are quite miniscule.
In order to save money, you have to control your finances. Saving has nothing to do with how much you make. It has everything to do with how you control your money. If you have lots of credit card debt and live paycheck to paycheck, you are not in control of your money. And you aren’t saving for the future either.
You have to spend less and save more. The two are tied together. In order to save, you have to start spending less.
And it all really isn’t that difficult if you just start doing it.
First, sit down and write down your financial goals. Just ask yourself what you want from your money. Perhaps you would like to have a down payment for your first home. Maybe you need a new car. Make long-term goals, such as retirement, and short-term goals, such as new living room furniture.
Give each goal a dollar amount and a time frame. In order to save, you have to know what you are saving for. You have to have a reason to put your money aside.
You will need to set up a separate savings account. You probably know that leaving the money in your checking simply won’t work — you will spend it. Have a savings account that you can easily deposit or transfer money into. Many banks will set up an automatic withdrawal to your savings each month. This is a easy way to set it and forget it. It is paid just like any other bill.
Over time, you will see your money start to grow. This is rewarding and exciting. Most people become motivated to save even more. Saving and investing can become addicting in a good way.
You will find that a written budget is almost essential for saving money. You need to know where your money is going in order to make changes to the way you spend. A budget not only tells you where you are spending, but it can help you plan how you spend. Include into your budget a debt reduction plan, and your budget will make the most of your dollars. Budgeting is simple and doesn’t require you to sacrifice your entire lifestyle. It is just a plan to get where you are going.
If you do have a lot of credit card debt, you should focus spending your saving money on eliminating that debt. It would be wise to put a small amount aside for emergencies, but the vast majority of the money you are saving right now needs to be going to your debt. The reason why is simple. Why pay 20% interest on a credit card debt when your savings are earning 2% to 10% in interest. You are spending more than necessary. Wipe out that credit card debt first. It will save you more in the long run.
A lot of people really boost their savings by putting their unexpected money into their savings accounts. Your bonuses, raises, tax refunds and overtime can really pump up your savings. You aren’t having to spend even less or cut back more, but you are seeing your account balance rise.
There is no real secret to saving money. You simply have to start doing it. That is often the hardest thing — the first step. But once you see your finances begin to change and the interest start working for you, you will be hooked on saving for your future.
Martin Lukac represents RateTake.com Mortgage mortgage marketplace. RateTake matches consumers with multiple lenders offering low mortgage rates from our network of accredited lenders.
Article Source: Saving For Your Future
Money is a critical component in every person’s life. The handling of money requires delicate care because there are just too many demands in our lives that require us to part with money, but the fact is we have a limited amount of it. The measure of your financial success lies in your ability to save. Saving enables wealth accumulation and thus, the ability to enjoy a better lifestyle. Money savings tips are abundant. What may be challenging is to apply them diligently. Described below are ways to enhance your money saving plans and build your wealth nest.
Differentiate “need” and “want” clearly. Many people mistake a want for a need and the consequences are often obvious; they claim not knowing where their money went at the end of the day. Yes, you will need food; but do you need to indulge in that expensive steak? Allocate a monthly amount to save aside. Assume that this saving is your future investment and should never be moved unless of emergency. Again, what constitutes emergency varies form one person to another. Essentially, you need high self-discipline to do well in managing your savings.
You should also practice prudent shopping, creating a shopping list to prevent impulse purchases. With the abundance of healthy food choice available, there is no excuse for you to consume unhealthy food products because you can get better choices with the same amount of money. Learn to cut back on convenience products- they are just depleting your financial resources without a real cause. When shopping, always care to find out the price of products and make comparison. You can also learn to challenge yourself to create your own gifts and DIY products.
These money saving tips are basic ideas. You should cultivate a healthy money saving habit to enable you to live a healthier and better lifestyle.
I’d like to share cool websites with more tips on topics like money saving tips and money out of my 401k. Visit for more information.
Article Source: Money Saving Tips For a Better Future
If you are one of the millions of people who has seen a sharp decline in the value of your retirement account, then you may be faced with the prospect of a retirement lost.
What do you do now? Do you keep working beyond your planned retirement date, in order to rebuild your nest egg? Or do you cash out whatever value you have remaining and try to stretch your retirement dollars for as long as you can?
What you can do is build up a new source of passive income that will make up for the shortfall in the funds you need for your retirement. Lost value doesn’t mean lost opportunity.
What you can do now is start earning passive income via the Internet. You don’t need to be a computer geek or a tech-savvy person. You don’t need to have web-design skills, an MBA, or even a business background. You don’t even need any money to get started.
All you need is a computer with Internet access. That’s it. Even a bum off the street can do it. All you need to do is spend an hour or two online every day, and you can be making hundreds, thousands, tens of thousands, or even hundreds of thousands of dollars every single month.
Billions of dollars are exchanging hands on the Internet by millions of people each and every single day. As an affiliate marketer, you can join the ranks of people who make their living by earning commissions for referring people to buy products on the Internet.
Regardless of how much your funds for retirement lost as a result of the economic crisis of 2008, you can rebuild that lost value in just a few short months or years, using passive money that you earn via the Internet.
It’s time to recession-proof your income! Whether you’ve been recently laid off or you are looking to generate an alternate source of income in the midst of this economic downturn, Internet marketing continues to be a thriving, lucrative source of income for hundreds of thousands of individuals and families world-wide.
Article Source: Retirement Lost – How to Rebuild Your Retirement Nest Egg
When the market goes up, it might be too expensive. When the market goes down it might go lower. The harder you try to figure out market timing, the more confused you are likely to become. And looking back in time is always easier than looking ahead.
Regular Savings Plan
When looking for a company that will help you save for your future becomes a difficult and time-consuming task, a trusted and reliable fund management company comes to the rescue. You may have not noticed it, but such company is actually accessible and you don’t really have to spend so much time, money and effort just to find the suitable one. An established company or that which has gained a reputation in the investment market is not that hard to find. All you need is the right and basic knowledge to do business with them and in order for you to get started with your savings plan. Be sure to look for one that lets you beat the clock.
How it Works
You will of course start with the basics. You can begin by putting aside a regular amount each month and then see what happens. Try to analyze the outcome or the results of your investments. Now, when your fund goes up, you win. You may ask why? It is because you are actually making money when the fund goes up. But what if the opposite happens? Well, the situation would be this, if your fund goes down, your regular contribution buys more shares in the fund, thereby putting you in an even better position to benefit when the funds moves back up again. What’s good about this is that either way, you will still benefit over the longer term.
Market Timing
Now you have to keep in mind to leave market timing to gamblers and speculators. The best thing to do is to join the smart investors who put their money each month into a regular savings plan with a stable company. So another thing that you need to consider to learn how this magic works is for you to speak to your investment adviser or bank. When you are settled with your investments, don’t be surprised to know if the value of your units may go down as well as up. The truth is, past performance is not necessarily a guide to the future. You should quite expect and know that the price of shares in the funds and income from a fund management company normally may go down as well as up.
With a low minimum initial investment of just $1,000USD, and minimum monthly payments of $100USD, additions to accumulating accounts can be through automatic payments or by cheque. Anybody can afford it, indeed savings plans are particularly flexible, allowing people or willing customers to add more or less along the way. Some companies’ mutual funds have no restrictions on the frequency with which people add to their investment or the amount of monthly contributions over the minimum. Investors in the savings plan also get a monthly statement, so they can follow the progress of their investment. GP
Wilson Field specialises in business recovery and personal debt solutions such as IVAs, CVAs and Liquidation. If you have taken out payment protection insurance on any of your loans then Real Claims specialise in PPI Claims which could win your thousands back from the loan companies.
Article Source: Saving For the Future – The Right Time is Always Now
Having children isn’t cheap these days, especially in the long term – the older they get, the more they cost. Higher education prices continue to soar and it’s almost impossible to get onto the housing market without having some capital or homeowner loans. All of these things may seem so far ahead, especially if your child is very young, but now’s the time to start saving to ensure you can provide what your children need further down the line.
Surveys suggest that we’re starting to realise this. A report published by Mintel in October 2005 found that 75% of British parents with children under 14 are now saving for their children’s futures. Nearly six million parents are now saving for their children, compared to just under five million in 2003. So it’s evident that we understand the need to save, but it’s not always easy to do so. The day-to-day family finances can be difficult enough to manage without having to think about the future. This article provides some information on how to save for children and explains some of the financial products available.
Bank accounts
The first step that most parents take towards saving for their children is to open a savings account on their behalf and start making cash deposits. Most banks and building societies have accounts specially tailored for children. They often have a higher rate of interest and offer incentives such as membership of a kids’ savings club with regular newsletters, piggy banks, toys and badges. Even if you’re not sure how often you’ll be able to make deposits into the account, it’s a good idea to set one up as soon as possible after your child is born so that it’s there whenever you do have money to put aside. Try to get into the habit of putting in at least a small amount on a regular basis – setting up an automatic transfer from your bank account will make this much easier. Alternatively, simply depositing the government child benefit on a weekly basis will get you off to a good start – it’s amazing how quickly it builds up.
Tax
Children are subject to income tax on bank accounts just like adults. They receive a tax allowance and as long as their total income including interest doesn’t exceed this allowance in the financial year, they will not be taxed on their interest. (The allowance for 2006-2007 s £5,035.) However, this only applies when the savings are gifted by a relative or friend. Interest on money gifted by parents will be subject to tax if the amount of interest earned in a year exceeds £100 per parent. (This prevents parents from taking advantage of children’s accounts for their own savings.) If your child’s annual income will be less than their tax allowance and the money you give them in a year will amount to less than £100 in interest, you can fill out an R85 form from the Inland Revenue to apply to have the interest paid without tax being deducted. It may be worth opening separate bank accounts if your child will be receiving money from yourself as well as relatives or friends, to save any confusion.
Child trust funds
The introduction of child trust fund by the government in 2005 has made a big difference in helping parents to save for their children. In the scheme, new parents are given a minimum of £250 to invest in a long-term savings and investment account on their children’s behalf, plus a further £250 when the child turns seven. The proceeds are held in trust for them until their 18th birthday. It’s not subject to tax and up to £1,200 can be invested each year by parents, family or friends.
There are three types of account – a savings account, a shares account and a stakeholder account. The choice you make will depend to a great extent on your attitude towards risk. Savings accounts are the safest method as you won’t lose money this way, but the returns on the investment tend not to be very high.
The shares account invest your child’s money by purchasing stock market shares. Investing in shares can be risky, especially in the short term, although on the whole the stock market can produce a good long-term returns as share values tend to rise more than they fall over a long period. As saving for children is normally a long-term approach, shares accounts can be an attractive option. However, shares can go down as well as up at any time and past performance isn’t necessarily an indicator of future performance. It’s also important to note that the account provider will normally charge an annual fee for managing the shares.
The stakeholder account is a medium risk option, which invests in shares until the child turns 13 and then the money is transferred to lower risk investments and assets, helping to limit potential losses in the lead-up to the child’s 18th birthday. However, if the stock market performs well over this period, the returns won’t be as high as they would have been if the money had remained in the higher risk investments.
You’ll need to choose not only which account you want for your child, but also which provider. Various different banks, buildings societies and financial organisations provide approved child trust fund accounts. The government simply sends you a voucher for £250, which you’ll invest in the account and provider of your choice. All providers are of course regulated and must meet the terms and conditions stipulated by the government. However, there may be differences in the products they offer. Look out for fees charged and any requirements relating to how much you deposit and how frequently.
Other government-backed savings options
The National Savings and Investments Bank (formerly the Post Office Bank) is an agency of the Chancellor of the Exchequer. It was set up in 1861 by the Palmerston Government to help working people save for their futures and as a means of raising government funds for public spending. It offers various safe and secure options for saving. Premium Bonds, for example, are a monthly large-value prize draw in which you can enter anything from £100 to £30,000. The jackpot can be up to £1million, but prizes of between £50,000 and £100,000 can be won for every bond number held. The prizes are tax-free and bonds can be bought by parents, relatives or friends on behalf of children under 16. Alternatively, indexed linked savings certificates are a great method of tax-free saving in which the value of your money increases in line with inflation (linked to the Retail Prices Index) at guaranteed interest rates. Between £100 and £15,000 can be invested per issue, and they are available to anyone over the age of seven (or can be bought on a child’s behalf if they are under seven).
There are lots of other possibilities for saving for your children – investments, stocks and shares, bonds, savings accounts, trust funds – not all of which are specifically designed for children. In such cases, you’ll need to manage the money on the child’s behalf until they reach 18 (or sometimes 21). To find out how you can best provide for your child’s future, you should visit a financial advisor who will be able to outline the most suitable options for you and your family.
Benedict Rohan works as a freelance finance writer. Commercial Mortgage, Homeowner Loans, Remortgages
Article Source: Saving For Your Child’s Future
The irony for Baby Boomers is that even though you will be living longer than your parents or your grandparents, most of you expect to delay retirement longer than your parents or grandparents. This is a follow on effect from the reduced nest egg that was going to keep your retirement income at a level to give you the lifestyle you had dreamed of. The current economic crisis has caused many Baby Boomers to have to plan to work past their retirement date or scale down their retirement expectations.
What once looked like a sufficient retirement nest egg for travelling the world and building their new easy care retirement homes, might not even maintain their existing or even a restricted lifestyle for the rest of their lives.
Baby boomers are better educated, with higher incomes and longer life expectancies than the generations that preceded them. They also have fewer children and may not be married, leaving them with fewer options if they need help in their old age.    People have been retiring at increasingly younger ages since the growth of superannuation and Social Security pensions began more than fifty years ago. However, the retirement trend appears to be reversing. The majority of men and a greater percentage of women over fifty five are still in the work force and experts believe it will increase even more as the oldest Baby Boomers reach sixty five.
People are living longer and leading more active lives and that increased longevity has been one of the crowning achievements of the last century, but is has to be financed somehow. Some will continue working by choice and many of those nearing retirement age may gradually reduce their workload rather than abruptly stop.  Others may have to stay on the job full time to replenish their diminished retirement nest egg.
Many of the Baby Boomers have put off retirement because of the effect of the financial crisis on their long-term savings and some of them think they can recoup the losses by working on in their job an additional year or two, but can they?
Are you looking at retirement with a larger amount of debt than you would like, including home equity lines of credit, partly paid off mortgages, credit card debt and personal loans. For the last few years, there has been extraordinary asset growth and low interest rates, and that combination allowed people to increase their net worth easily and significantly, and that in turn made their expectation of paying off debts to be a simple matter.
If you are among those planning their retirement but are concerned about your level of debt, whether it is still an amount owing on the mortgage or in other categories of debt, it is time to take some definite steps to make some mindset and lifestyle changes.  Remind yourself from time to time, that paying a mortgage and trying to pay off debts at the same time, while living on a fixed income isn’t a whole lot of fun. For a pampered Baby Boomer, this is one of the most difficult things to do
Most Baby Boomers are computer savvy because of their jobs; and will be looking at ways to build and or increase their retirement nest egg and income by doing research on the internet into the many opportunities available. There are opportunities that involve starting your own home internet business and then you are in control of the amount of time you need to spend to make the business a success. You are also in control of the level of success you wish to have in your new venture. Obviously the more drive and effort you put into any business the greater chance you will have for achieving success at a much higher level.
All it takes is having the right mindset and understanding that the rewards will be there for the long term by putting in the effort now.
You may need to work for a few years yet to reach the level of financial freedom that is your goal, so do your research to make sure you start a business that you will love and that will give a good balance of fulfilling work and time for yourself and family and friends.
Look for a business that will give you step by step guidance in the best ways to achieve your goal of a financially rewarding, successful business.  Look for a business that will have an exit strategy to enable you to receive an income stream after you cease to become active in your enterprise. Most Baby Boomers have at least basic computer skills and it is worth investigating the diverse opportunities for an online home business that will “tick the boxes” in their criteria list.
Baby Boomers, if you have the drive to achieve abundance with Personal and Prosperity Growth in an online home business, take the next step in your research and click below: http://www.HolisticWealthInfo.Com
Article Source: Baby Boomers Looking to Nurture Their Retirement Nest Egg
After a long career working in the technical field and some years as a musician, I became involved with a rather unconventional insurance and financial company. Their focus was to teach people everything banks and insurance companies didn’t want you to know. I became licensed to sell life insurance and mutual funds. Much of our business was from people who had bundled insurance products.
The only life insurance product we sold was term life insurance. Our only investment products was mutual funds. The company motto was buy term and invest the difference. After many years I had finally became exposed to knowledge of how money works. Before I gained this knowledge, I had worked for seventeen years with a very good company. Due to my lack of knowledge about how money worked, I got nowhere near the return I should have from my 401K. Here is a review of some of what I learned and what every one should know.
The first thing you need to know is how invested money grows. There is a simple rule of thumb called the rule of 72. Divide 72 by the rate of interest and you will find how many years it takes your money to double. At the bank these days you are lucky if you can get 2% on a savings account. If you divide 72 by 2 you get 36. In 36 years $1000 will become $2000. Divide 72 by 12 and you get 6. In 36 years $1000 will double six times and becomes $64,000. Give it 12 more years to 48 years and it becomes $256,000. As you can see, time is an essential ingredient in this formula for financial success.
Are there places to get 12% return on an investment? Over the short term no. However, with all the ups and downs in the economy, including the great depression and the many recessions, over a fifty year period there are investments that have returned 12% or better. These results have been achieved by investing in the stock market. Honest financial people have to tell you that past performance is no guarantee of future performance. In other words, history may not repeat itself.
Maybe fifty years from now, governments will collapse and there will be no viable economic future. Maybe the world will end from global warming or be hit by an asteroid. We have to trust that there will be a future and the economy will grow. One thing is certain. If you don’t save you will die broke. Second, Most people waste many $1000 in their life times. Why not put a few of those $1000’s to work for your future. Let’s look a what you need to know to have success in the stock market.
One thing, you need is diversification. The best way to do this is through mutual funds. Through mutual funds, you can invest in thousands of companies. You can also diversify across risk levels by choosing funds with different objectives. For less than $100 a month you can begin investing. You also need to invest long term. Even experts trading in and out of the market often lose.
Mutual funds have restrictions on excessive trading. The best way to invest long term is to use dollar cost averaging. What you do is invest a fixed amount, weekly or monthly. When the market is up, you buy fewer shares. When the market is down, you buy more shares. In the long run, when a market goes down and up, you make more money than in a market that keeps going up.
The final point I will make is control expenses. Every dollar that goes into expenses is a dollar that doesn’t get invested. Insurance companies love to sell bundled life insurance products. What you are getting is life insurance plus a cash building investment. These can be anything from low yielding savings to investments in the stock market. The problem is there are usually high up front charges and hidden expenses. The other problem is that if you are a young family, you need all the life insurance that you can get.
You need to buy lot’s of cheap term insurance. When you are older, children are grown and you don’t need life insurance you need money for retirement. You only need life insurance in proportion to the responsibility you have to others. The idea of a bundled policy is to give you cash value as you become older and less insurable. You can accomplish this better by buying term and investing the difference. Investing through 401k’s with a company match, tax deferred Ira’s, and low cost indexed funds are some of the best ways to go.
All my life I’ve been a seeker after knowledge. I’ve worked in science, music, the financial field and spent many years as a member of a public speaking organization. It was while working in the financial field that I became aware of the basic principles of how money works. I am an avid reader of non fiction books on many different topics. I have a knowledge web site. It’s purpose is to share knowledge. Right now it has an extensive music section, some pages on how money works, and a book review section. http://tonyknows.com/money
Article Source: Building Your Nest Egg – Learn How Money Works
If you’re like me, you’re just starting to become financially stable for the first time. You have a little bit of extra cash set aside in savings, but it’s not enough to be able to “play” with it in the stock market. You want to find a way to make your little nest egg get a higher return than if it is simply sitting in a savings account, but you need a safe and secure way to invest.
An excellent way to combine a high rate of return and a high degree of security is by investing in mutual funds. In short, a mutual fund is a stock portfolio that someone else manages for you, in which your money is in effect distributed over a wide range of different stocks, bonds, and other investments. Many fund managers write mutual fund newsletters for their unit holders helping to explain their investment decisions.
Because professionals manage your mutual fund for you, you don’t have to worry about making a mistake. And because a mutual fund is a form of distributed investment, the risks to you are very low – that is, even if an individual stock or investment does badly, the other stocks or investments in the portfolio will tend to balance it out, making you less likely to lose money.
You can find out more about mutual fund planning by contacting an investment specialist. He or she can give you the information you need, as well as help manage your mutual fund for you. By working with an investment specialist, you will find out exactly how easy it is to make money and protect your investment – just sit back, and let him or her do all the work for you!
If you do decide to go the mutual fund route, you may wish to purchase a subscription to a mutual fund newsletter. A mutual fund newsletter is a weekly digest that contains all the information you need to know about the state of the market, the various types of mutual fund, and investment-related current events. A mutual fund newsletter is vital if you wish to stay informed and on top of your game, even if you do leave most of the more difficult work to your investment specialist.
In today’s rapidly fluctuating market and unstable political and economic climate, it makes sense to keep your money in an investment that offers a high rate of return, and is safe against market forces. A mutual fund is an excellent choice for your little nest egg – to help it grow into what will one day become your great big nest egg.
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Article Source: Mutual Fund Newsletter – Protecting Your Nest Egg