Personal Finance en-US 5 Ways the Ebola Outbreak Could Hurt the Economy — And Your Wallet <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-ways-the-ebola-outbreak-could-hurt-the-economy-and-your-wallet" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="panicking businessman" title="panicking businessman" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>We all know that the Ebola virus probably is not a threat to our health &mdash; but what about our fiscal health? As this deadly global story comes to a boil, it's also taking its toll on our wallets. And while nothing could compare to the deadly effects of the disease, these financial concerns are worth keeping an eye on.</p> <h2>1. There Could Be a Global Financial Collapse</h2> <p>Analysts at Barclays are warning that the continued spread of the deadly Ebola virus beyond the confines of West Africa could have a <a href="">&quot;significant&quot; impact on the financial markets</a>. &quot;Ebola's likelihood of spreading to larger, more integrated economies has increased,&quot; Barclays' Marvin Barth told The Telegraph.</p> <p>Already the disease has sparked a sell-off of travel and airline stocks worldwide. &quot;If consumers and businesses retrench by <a href=";_type=blogs&amp;_r=0">reducing flights on airplanes</a>, changing vacation plans, or altering business connections in a globally interdependent world, G.D.P. growth rates will fall farther,&quot; wrote David R. Kotok, chairman and chief investment officer of Cumberland Advisors. &quot;We do not know how much, at what speed, or for how long.&quot;</p> <p>In terms of its potential to wreak havoc on the markets, experts are comparing Ebola to Asia's outbreak of the airborne SARS virus in 2003. Not only did SARS rattle regional tourism and China's stock exchange, it also instigated a pronounced slump in retail sales.</p> <h2>2. The Price of Chocolate Could Skyrocket</h2> <p>Hold on to your chocolate bars! The <a href="">price of cocoa beans spiked</a> more than 10% last month due to fears that Ebola could spread to the Ivory Coast, the world's largest producer of chocolate's main ingredient. Ivory Coast shares a border with Guinea and Liberia, two of the three countries (the third being Sierra Leone) that are most affected by the virus. Not only is this West African region ground zero for Ebola, but it's also home of 70% of the world's cocoa supply. With Halloween just around the corner and the holiday season soon to follow, Nestle's chief executive has said <a href="">the company is on &quot;high alert.&quot;</a></p> <h2>3. Airline Stocks Could Take a Plunge</h2> <p><a href="">Airline stocks are already down</a> about 7% due to fears of a global health crisis. And on the heels of news earlier this month that a medical worker contracted Ebola in Spain, shares in IAG, which owns British Airways and Iberia, as well as the cruise operator Carnival, dropped nearly 9% in two days, largely due to concerns about the potential for future travel bans. Meanwhile, the World Travel and Tourism Council that represents airlines, hotels, and other travel companies is reporting <a href="">a 30% plunge in early bookings to Africa</a>, where the disease is deeply entrenched. But experts say the outlook for airline companies and their shareholders could likely get much, much worse.</p> <p>&quot;It certainly depends on how serious and how <a href=";economy-171944171.html">widespread the situation becomes</a>,&quot; Michelle Girard, chief economist at RBS, told a reporter for Yahoo! Finance. &quot;Of course, people talk about, 'What if it becomes airborne?' And then you have a scenario where the borders are shut and people are afraid to travel, not just internationally, but perhaps domestically. If there are concerns about&hellip; being trapped on an airplane with the potential for somebody to be spreading the virus. Those are all the things that people are worried about, and you can understand that forward-looking investors are beginning to at least price in. [They] feel the need to price in some probability or some sort of risk of that [happening], albeit small.&quot;</p> <h2>4. Travel Insurance Could Become a Must</h2> <p>Global health and safety events are among the top reasons why nearly half of all jetsetting Americans <a href="">consider purchasing travel insurance</a> for international trips, according to data from Allianz Global Assistance USA. After Sept. 11, for example, there was a 10% bump in spending by Americans on airline travel insurance. But right now only about a third of Americans flying to foreign destinations actually follow through and buy the insurance. Experts say that's likely to change. As the Ebola virus continues on its cross-continental course, infecting numerous persons who either caught the virus or transported it via airplane, it's likely that more Americans will begin to view spending on airline travel insurance as a necessity.</p> <h2>5. The Health Care System Could Be Taken for a Ride</h2> <p>Nobody has yet to calculate the fallout of the Ebola virus on the health care system &mdash; neither here in North America nor abroad. But what's clear is that the money being poured into the fight against the disease (training, testing, treatment, waste disposal) &mdash; not to mention the money lost as hospital beds sit unused in isolation areas &mdash; will certainly affect the industry.</p> <p>&quot;One of the things I fear about Ebola is that it could spread more widely in Africa,&quot; Center for Disease Control Director Dr. Thomas Frieden told a congressional hearing. &quot;If this were to happen, it could become a threat to our health system and the healthcare we give for a long time to come.&quot;</p> <p><em>How fearful are you about Ebola?</em></p> <a href="" class="sharethis-link" title="5 Ways the Ebola Outbreak Could Hurt the Economy — And Your Wallet" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Brittany Lyte</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Personal Finance Frugal Living disasters and money ebola fear personal finance sickness Fri, 24 Oct 2014 13:00:04 +0000 Brittany Lyte 1241738 at 8 Personal Finance Tips for Introverts <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-personal-finance-tips-for-introverts" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="woman paying bills" title="woman paying bills" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>So, you're an introvert. Whether you've known this forever or are just realizing it, welcome to our happy, friendly, quiet tribe.</p> <p>Introversion can play a role in everything from earning power to how and when and why I make the investment decisions I do. Here are some financial tips based on the strengths and weaknesses that I've found in myself, and that other introverts tend to share. (See also: <a href="">7 Personal Finance Tips From Bruce Springsteen</a>)</p> <p>Remember, as you read these, that not all introverts have every characteristic of introversion. You may find that you have already learned to be good at something that is a weakness for many of your fellow introverts, or that you actually struggle with something that most introverts have as a strength.</p> <h2>Maximize Your Strengths</h2> <p>If you're an introvert, use the things that you're already good at to improve your financial life. Just don't let someone louder talk you out of them!</p> <h3>1. Save&hellip; A Lot</h3> <p>Introverts tend to be conscientious, and <a href="">conscientious people save more for retirement</a> than others. In a world where <a href="">only 4%</a> of the current workforce will have enough saved for retirement by age 65, that's a significant advantage.</p> <p>This propensity towards saving won't just help you with retirement. If you're careful, you might be able to avoid a lot of the debt that many find themselves in. You might even be able to purchase your vehicles with cash!</p> <p><strong>Tip</strong>: Maximize this advantage by calculating how much you think you'll need for retirement and working backwards to determine how much you should be saving every month. Decide how much you want for emergency or other savings funds, too, and work towards those goals.</p> <h3>2. Play the Long Game</h3> <p>As an introvert, <a href="">you're likely pretty good at delaying gratification</a>. This means that you understand that wealth generally grows slowly, and you're ok with that. You can accept small gains with a smile, because you understand that they will add up over time.</p> <p>Using this to your advantage means knowing that you can ride out a recession or other devaluation of your assets without panicking and changing everything. You will be able to see that your path to wealth will have some ups and downs &mdash; maybe even big ones &mdash; and that there are still many ways for things to work out in the end.</p> <p><strong>Tip</strong>: Plan ahead for financial difficulties &mdash; maybe make sure you have a substantial emergency fund or that you can work another 10 years if the market isn't right to retire when you're 65.</p> <h3>3. Stay Calm</h3> <p>Introverts tend to be among the calmest people out there. They are usually the best prepared and, in our extroverted world, they tend to be used to acting different from how they are feeling. This means that they're less likely to panic when something unexpected happens. Whether the market crashes, there's an unexpected medical bill, or an investment that looked sure turns south, they will be able to quell panic and make level-headed decisions.</p> <p><strong>Tip</strong>: When something bad happens financially, use your natural calm to your advantage. If the market crashes, don't sell because you're afraid. If there are unexpected bills, come up with a creative way to pay them because you won't be driven by terror. And anytime an investment goes wrong, use your clear head to decide how to get out of the situation having sustained the least damage.</p> <h3>4. Listen</h3> <p>Introverts tend to be good at listening before they speak. This makes them good leaders, but it can also make you a good investor.</p> <p><strong>Tip</strong>: It's easy to jump into investing with your own strategy, or with one you haven't really researched. So many people think they can beat the market, and so few actually do. As an introvert, you have the listening skills to hear what others do or have done, what has worked and what hasn't, and to craft your own investing strategy around the successful strategies of others.</p> <h2>Work Your Weaknesses</h2> <p>While using your strengths will take you far, learning to overcome your weaknesses can add even more to your financial health.</p> <h3>5. Take Risks</h3> <p>Introverts aren't necessarily risk-averse, but <a href="">they do tend to be more calculated about the risks they take than extroverts</a>. However, the key part of that is actually taking the risk. You must, at some point, take the leap, and that means letting go of whatever you've been holding onto, financially, and trying something new.</p> <p><strong>Tip</strong>: The tip is to let go when you know it's time, and you will know. This may mean trying new types of investments, but only after you know that they fit your overall strategy and have chosen your tactics for investing in them. It may mean being willing to spend money &mdash; even a lot of money &mdash; on something that is important to you or that will make your life better, even if you'd rather the money pad your savings account.</p> <h3>6. Stop Researching</h3> <p>While it's an overall advantage to research and ponder before you make financial decisions, you do eventually need to do something. Otherwise, you may end up crying over missed financial opportunities. Many <a href="">introverts missed out on low stock prices</a> at the end of the recession for this very reason: They weren't sure that the market had really bottomed out, so they weren't sure they should buy.</p> <p>This tends to go alongside taking risks. In the end, no matter how much research you do, there's always some risk. At some point, you have to accept that so you have a chance at reaping rewards.</p> <p><strong>Tip</strong>: Ask yourself, &quot;Do I know enough to make an educated decision?&quot; If you aren't sure, talk to someone close to you. When you know enough, stop researching, even if there are things you haven't read yet. Instead, do what needs to be done.</p> <h3>7. Learn to Negotiate</h3> <p><a href="">Introverts tend to dislike conflict</a> and, therefore, give in rather than negotiate because they dislike the ongoing disagreement. However, knowing how to negotiate &mdash; everything from the price of your new car to your salary &mdash; can help you come out better off financially. Most introverts are great at preparing for negotiating &mdash; they know how much they should be paid or what is a fair price for something they are buying. But the problem comes in carrying out the actual negotiation.</p> <p><strong>Tip</strong>: If you have the chance, try to <a href="">negotiate via email</a>. This can help minimize the disagreement and it gives you the chance to put your thoughts into words, which comforts many introverts. If that isn't possible, decide what you want to say and how you want to say it. It may help to write out a script, even if you have to memorize it before you go to a meeting.</p> <h3>8. Make Yourself Valuable</h3> <p>Gone are the days when you have to promote yourself loudly or you'll never get ahead. Now, many <a href="">employers are looking for people with fresh ideas</a> and those who are good at building others up. These tend to be skills that introverts already have or that it is easy for them to acquire.</p> <p>This means that, finally, the playing field between introverts and extroverts is leveling when it comes to the amount of money you could potentially bring in.</p> <p><strong>Tip</strong>: Instead of being someone you're not in order to get that promotion, trying using skills that are more natural to you. Your ability to listen well and come up with creative solutions can help you get ahead, especially if you find the right company.</p> <p><em>Are you an introvert? How has it affected you financially? Please speak up and share in comments!</em></p> <a href="" class="sharethis-link" title="8 Personal Finance Tips for Introverts" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Sarah Winfrey</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Personal Finance introverts investing money lessons saving Thu, 23 Oct 2014 13:00:06 +0000 Sarah Winfrey 1241336 at Get Up To 8% Cash Back Shopping at Whole Foods (Limited Time Deal!) <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/get-up-to-8-cash-back-shopping-at-whole-foods-limited-time-deal" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="grocery shopping" title="grocery shopping" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Shopping at Whole Foods can definitely put a dent in your wallet. We've offered suggestions before on the <a href="">best ways to save at Whole Foods</a>. And for the next four months, you can save even more &mdash; up to 8% cash back on your purchases.</p> <p>Americans spend 130% more on average on groceries per week during the holiday season. And American Express Blue Cash Card Members can get a little help with their budget. Now through February 15, 2015, get an additional 2% cash back on top of your already <a href="">generous grocery rewards</a>. That's 5% with the <a target="_blank" href=";fot=1150&amp;foc=1" rel="nofollow">Blue Cash Everyday&reg; Card</a> and 8% with the <a target="_blank" href=";fot=1150&amp;foc=1" rel="nofollow">Blue Cash Preferred&reg; Card</a>! And in case you were wondering, yes, it applies to online purchases made at <a href="" title=""></a> as well!&nbsp;<strong>Note: You must enroll your card for the purchases to be eligible for the extra 2% cash back.&nbsp;</strong></p> <p>The Blue Cash cards are a favorite here at Wise Bread. We've touted their benefits for <a href="">cash rewards</a>,&nbsp;<a href="">gas rewards</a>, and of course, <a href="">grocery savings</a>. If you don't already have one of these cards, now's the time to get one! Not only are they offering a big sign up bonus: $100 (Blue Cash Everyday) and $150 (Blue Cash Preferred) statement credit when you spend $1,000 within the first 3 months, but you also get a 0% Intro APR for 15 months (after that it will be a variable rate 12.99%-21.99% based on your creditworthiness and other factors).&nbsp;</p> <p>Check out the details below to choose which card is best for you.&nbsp;</p> <h3>Blue Cash Preferred&reg; Card from American Express</h3> <p><a title="Blue Cash Preferred&reg; Card from American Express" alt="Blue Cash Preferred&reg; Card from American Express" rel="nofollow" href=";fot=1150&amp;foc=1" target="_blank"><img border="0" src="" alt="" style="float:right;margin:0 10px;" /></a>The <a target="_blank" href=";fot=1150&amp;foc=1" rel="nofollow">Blue Cash Preferred&reg; Card</a> offers a whopping 6% cash back at US supermarkets (up to $6,000 per year in purchases, then 1%), 3% at US gas stations and select department stores, 1% on other purchases. Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit. It does have an <strong>annual fee</strong> of $75, but if you have a big grocery budget, the rewards would be more than enough to cover this yearly cost.</p> <p><strong>Sign up offer</strong>: Get $150 back after you spend $1,000 on purchases on your new Card within your first 3 months. You will receive $150 back in the form of a statement credit. Also, get 0% intro APR on purchases and balance transfers for 15 months. After that, your APR will be a variable rate, currently 12.99% to 21.99%, based on your creditworthiness and other factors.</p> <ul> <li>Get $150 back after you spend $1,000 on purchases on your new Card in your first 3 months. You will receive $150 back in the form of a statement credit.</li> <li>Hassle-free cash back: no enrollment required, the same great reward categories year-round.</li> <li>Earn Cash Back: 6% US supermarkets up to $6,000 per year in purchases, 3% US gas stations &amp; select US dept stores, 1% on other purchases. Terms and limitations apply.</li> <li>Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.</li> <li>A credit card that gives you cash back with a 0% Intro APR Offer on purchases and balance transfers for 15 months.</li> <li>After that, your APR will be a variable rate, currently 12.99%-21.99% based on your creditworthiness and other factors.</li> <li>Terms and restrictions apply.</li> </ul> <p><a target="_blank" href=";fot=1150&amp;foc=1" rel="nofollow"><strong>Click here to apply for the Blue Cash Preferred&reg; Card today!</strong></a></p> <h3>Blue Cash Everyday&reg; Card from American Express</h3> <p><a title="Blue Cash Everyday&reg; Card from American Express" alt="Blue Cash Everyday&reg; Card from American Express" rel="nofollow" href=";fot=1150&amp;foc=1" target="_blank"><img border="0" style="float:right;margin:0 10px;" src="" alt="" /></a>Don't like the idea of getting a card with an annual fee? The&nbsp;<a rel="nofollow" href=";fot=1150&amp;foc=1" target="_blank">Blue Cash Everyday&reg;</a>&nbsp;has none, but still gets you 3% cash back at US supermarkets (up to $6,000 per year, then 1%), 2% at US gas stations and select US department stores. Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.<strong> </strong></p> <p><strong>Sign up offer</strong>: Get $100 back after you spend $1,000 on purchases on your new Card within your first 3 months. You will receive $100 back in the form of a statement credit.</p> <ul> <li>Get $100 back after you spend $1,000 on purchases on your new Card in your first 3 months. You will receive $100 back in the form of a statement credit.</li> <li>Hassle-free cash back: no enrollment required, the same great reward categories year-round.</li> <li>Earn Cash Back: 3% US supermarkets up to $6,000 per year in purchases, 2% at US gas stations &amp; select US dept stores, 1% on other purchases. Terms and limitations apply.</li> <li>Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.</li> <li>No Annual Fee. A Credit Card that gives you cash back with a 0% Intro APR Offer on purchases and balance transfers for 15 months.</li> <li>After that, your APR will be a variable rate, currently 12.99%-21.99% based on your creditworthiness and other factors.</li> <li>Terms and restrictions apply.</li> </ul> <p><a rel="nofollow" href=";fot=1150&amp;foc=1" target="_blank"><strong>Click here to apply for the Blue Cash Everyday&reg; Card today!</strong></a></p> <a href="" class="sharethis-link" title="Get Up To 8% Cash Back Shopping at Whole Foods (Limited Time Deal!)" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Lynn Truong</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Credit Cards Food and Drink Shopping credit card rewards Whole Foods Mon, 20 Oct 2014 18:40:11 +0000 Lynn Truong 1240222 at 7 Ways to Keep Your Retirement Funds From Disappearing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-ways-to-keep-your-retirement-funds-from-disappearing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="mature couple finances" title="mature couple finances" class="imagecache imagecache-250w" width="250" height="124" /></a> </div> </div> </div> <p>More than one-third of Americans have <a href="">no retirement savings</a>.</p> <p>This shocking figure should provide a wake up call and set you on your course to better prepare for retirement. Even if you haven't started yet, it's never too late. (See also: <a href="">This Is the Basic Intro to Having a Retirement Fund That Everyone Needs to Read</a>).</p> <p>No matter the size of your retirement account, here are seven effective strategies to help you keep your retirement account from disappearing.</p> <h2>1. Borrow as Little as Possible From a Retirement Fund</h2> <p>Sometimes finding good financing options can be difficult. That's when you may start eyeing your 401(k) for a loan. While you may think that it is easy to pay those funds back, statistics show that's not the case. Every year Americans default on about <a href="">$37 billion in 401(k) loans</a>.</p> <p>If you are unable to pay back your 401(k) loan within five years, you're hit with a double whammy:</p> <ul> <li>The unpaid balance becomes an early withdrawal from your 401(k), receives a 10% early distribution tax penalty from the IRS, and becomes taxable income as well.<br /> &nbsp;</li> <li>You cannot make up for those contributions to your retirement account. Every year you have a contribution limit, and if you don't use it, you lose it!</li> </ul> <p>There are very, very few instances in which you should borrow from your retirement fund. One of those few instances is when you need a down payment for a home purchase. (See also: <a href="">This Is When You Should Borrow From Your Retirement Account</a>)</p> <h2>2. Set Up an Emergency Fund</h2> <p>26% of Americans have <a href="">no emergency savings</a>.</p> <p>This is a major reason retirement disappears. You need to plan ahead and have enough saved up to cover your income for at least six months. In 2014, only 40% of Americans are able to save enough to cover at least three months. Don't become part of that statistic and start saving today towards a rainy day.</p> <p>Having an emergency fund does away with the need to tap your retirement accounts. Your nest egg should be your very last resort for money before retirement. However, don't just stop with maintaining an emergency fund: Create a detailed plan of action for when disaster strikes. (See also: <a href="">Emergency Plan: Better Than an Emergency Fund</a>)</p> <h2>3. Avoid Early Withdrawal Penalties</h2> <p>In 2010, penalized 401(k) withdrawals hit a <a href="">record high of almost $60 billion</a>. Taking early withdrawals (also known as distributions) puts a heavy toll on your nest egg. Not only are you responsible for the applicable income taxes, but also you have to pay the 10% additional early distribution tax.</p> <p>Fortunately, the IRS does provide some <a href=",-Employee/Retirement-Topics&mdash;-Tax-on-Early-Distributions">exceptions to the 10% additional tax on early distributions</a>. For example, you can withdraw early without penalty:</p> <ul> <li>From eligible IRA, SEP, Simple IRA, and SARSEP plans for qualifying higher education expenses for your spouse or immediate family members;<br /> &nbsp;</li> <li>From eligible retirement plans, including 401(k) plans, for unreimbursed medical expenses exceeding 10% of your income; and<br /> &nbsp;</li> <li>Up to $10,000 from eligible traditional IRA plans for <a href="">first-time home purchases or substantial home improvements</a>.</li> </ul> <p>While there exceptions to the 10% additional tax, there are no exceptions to applicable income taxes, including capital gains. Consult your financial advisor before attempting any early withdrawals from your retirement accounts.</p> <h2>4. Minimize Management Fees</h2> <p>Talking about retirement plan managers, you need to check how much you are paying in plan management fees. According to an <a href="">AARP study on 401(k) participants</a>, about three in five Americans are unaware of how much they are paying in fees for their retirement accounts, and almost one in three is unsure of the impact of fees in their retirement savings.</p> <p>A good rule of thumb is that your total expense ratio should be no more than 1%. For example, if you have $30,000 in retirement savings, your total management expense should be no more than $300. If you're getting charged more than that, it is time to dump that plan and look for more reasonable alternatives.</p> <p>If you have several retirement accounts from previous employers, evaluate if it makes sense to roll over all those balances into your retirement account with the smallest management fees. Before initiating the rollover, review all applicable fees and eligibility rules.</p> <h2>5. Stop Playing the Market</h2> <p>When you hear about &quot;a hot stock tip,&quot; you should walk away. Like Benjamin Franklin said, the only sure things in life are death and taxes. Nearly half of 401(k) plan owners don't know what their <a href="">best investment options</a> are.</p> <p>There are several problems with playing the market on your own.</p> <ul> <li>Most retirement plans charge fees for every transaction that you make. Remember that you want to <em>minimize </em>fees.<br /> &nbsp;</li> <li>Trying to juggle your day job and the stock market may cause a lot of unneeded stress.<br /> &nbsp;</li> <li>The average actively managed mutual fund returns <a href="">approximately 2% less per year than the stock market</a>. And these are the pros that do it for a living!</li> </ul> <p>Keep in mind at all times that getting to your retirement goal isn't a sprint; it's a marathon.</p> <h2>6. Participate in Employer-Sponsored Plans</h2> <p>If you have the option of signing up for an employer-sponsored retirement program, do it. Nine in 10 Americans participating in <a href=";content_id=5362">employer-sponsored retirement plans</a> actually save for retirement. Trying to save on your own is much harder and requires a lot of self-discipline. This is why only two in 10 Americans are able to have a nest egg without an employer-sponsored plan.</p> <p>There are two additional benefits to participating in employer-sponsored plans. First, some of them match your contributions. The <a href="">average employer match is 4.5% of pay</a> to a retirement account. Don't leave free money on the table. Second, <a href="">more than half of companies offer some type of investment advice</a>. This is valuable and free information to make more informed decisions about your retirement strategy.</p> <h2>7. Consider Annuities</h2> <p>Why?</p> <ul> <li>Some types of annuities guarantee a steady stream of income.<br /> &nbsp;</li> <li>Like retirement plans, annuities allow you to defer taxes until retirement.<br /> &nbsp;</li> <li>Unlike retirement plans, annuities have no contribution limits.<br /> &nbsp;</li> <li>Some annuities offer upside income potential, while guaranteeing your original investment or a minimum return on your investment to your beneficiaries in case of your death.<br /> &nbsp;</li> <li>Annuities allow older individuals to make additional catchup contributions.</li> </ul> <p>There are different types of annuities, so make sure to review and understand the applicable rules, such as required initial investments and applicable fees. Talk with your financial advisor about whether or not annuities make sense with your retirement planning strategy. (See also: <a href="">Don't Know What Annuities Are? You Might Be Missing Out</a>)</p> <p><em>What are other useful strategies to avoid a disappearing retirement? Please share in comments below!</em></p> <a href="" class="sharethis-link" title="7 Ways to Keep Your Retirement Funds From Disappearing" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Damian Davila</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Retirement 401(k) annuity investing retirement planning Mon, 20 Oct 2014 13:00:06 +0000 Damian Davila 1237800 at Wise Bread Reloaded: President Obama's Credit Card Declined at Pricey Restaurant (and How You Can Avoid the Same Fate) <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/wise-bread-reloaded-president-obamas-credit-card-declined-at-pricey-restaurant-and-how-you-can-avoid" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="credit card protection" title="credit card protection" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>This week the President revealed that even the leader of the free world is not immune to credit card identity fraud.</p> <p>&quot;I went to a restaurant up in New York when I was &mdash; during the U.N. General Assembly, and <a href="">my credit card was rejected</a>,&quot; the President said during an executive order signing ceremony at the Consumer Financial Protection Bureau. &quot;It turned out I guess I don't use it enough. They were &mdash; they thought there was some fraud going on. Fortunately, Michelle had hers.&quot;</p> <p>The President usually pays with cash and doesn't often carry a credit card, which is a good budgeting trick, even for someone who earns a $400,000 per year salary.</p> <p>The executive order instructs government agencies to beef up <a href="">identity fraud protections</a> on government issued credit cards. The protections will include the new &quot;Chip and PIN&quot; security technologies that most card issuers and big retailers will move to in the next few years.</p> <p>Of course, regular readers of Wise Bread are familiar with Chip and PIN &mdash; and a whole host of other ways to protect themselves from identity theft, along with lots of advice about maintaining good credit card hygiene. Here's a sampling in this weekend's Reloaded.</p> <h2>This Is How Chip and PIN Defends Against Identity Theft</h2> <p><img width="605" height="340" src="" alt="" /></p> <p>Emily Guy Birken explains the technology behind Chip and PIN, what it will protect you against &mdash; and what it won't while she ask <a href="">Will New Chip-and-PIN Credit Cards Stop Identity Theft?</a></p> <h2>Uh Oh &mdash; Where's My Card?</h2> <p><img width="605" height="340" src="" alt="" /></p> <p>If you've ever had that sinking feeling when you realize your credit card has been lost, you probably wish you knew the <a href="">10 Things You Should Do Immediately After Losing Your Wallet</a>. And if you don't know that feeling yet, keep Paul Michael's list handy!</p> <h2>Should You Hire an Identity Theft Protection Service?</h2> <p><img width="605" height="340" src="" alt="" /></p> <p>Peace of mind is valuable, but the service can be expensive. Wise Bread contributor GE Miller shows you <a href="">How to Do What Identity Theft Protection Companies Do&hellip; for FREE</a>.</p> <h2>What Do They Do With Stolen Plastic, Anyway?</h2> <p><img width="605" height="340" src="" alt="" /></p> <p>Big time credit card fraudsters buy and sell identities for all sorts of nefarious schemes, but as Carrie Kirby explains, the smaller operators &mdash; the ones who get nabbed &mdash; are the authors of these <a href="">8 Weirdest Cases of Credit Card Theft</a>.</p> <h2>New Ways to Pay With Plastic</h2> <p><img width="605" height="340" src="" alt="" /></p> <p>Plastic is pretty convenient (when used responsibly) and Mark Jackson shows how much more convenient it can be with these <a href="">6 Pieces of Credit Card Tech That Will Blow Your Mind</a>.</p> <a href="" class="sharethis-link" title="Wise Bread Reloaded: President Obama&#039;s Credit Card Declined at Pricey Restaurant (and How You Can Avoid the Same Fate)" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Lars Peterson</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Credit Cards credit credit declined credit score Sat, 18 Oct 2014 11:00:07 +0000 Lars Peterson 1238259 at How to Never Succumb to Impulse Spending Again <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-never-succumb-to-impulse-spending-again" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="shopping" title="shopping" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Impulse spending can make it almost impossible for someone to manage their finances effectively. It creates a habitual need to spend and a knee-jerk reaction to sales, products, and advertising. And the result is usually the same: a lack of cashflow, problems saving, and almost always an inability to maintain a budget.</p> <p>But what exactly is impulse spending? How do we define and/or recognize it?</p> <h2>Defining Impulse Spending</h2> <p>First, impulse spending is almost always chronic and recurring. To see something every once in a while and &quot;splurge&quot; is normal. Impulse spending is something that happens regularly and develops into a bad habit. (See also: <a href="">13 Creative Ways to Defeat Impulse Spending</a>)</p> <p>Second, buying on an impulse means that you're making an unplanned purchase that you hadn't already recognized a need for. These purchases might be useful and might even seem wise on the surface, but had you not made visual contact with the item, you probably wouldn't have wanted to spend money on it. In other words, an impulse purchase is made when a product or ad instigates the transaction. Instead of you deciding that you need something and then going to find it, you see a product or service and decide immediately that it warrants your money. Those who struggle with this end up spending a lot of money that they didn't need to spend or that wouldn't have been spent, had they been in control of their purchases. In fact, that's the real goal here &mdash; to be in control of how purchases.</p> <h2>1. Break the Habit With a Freeze on All Discretionary Spending</h2> <p>Impulse spending is a habit, so try breaking it by going cold turkey on all discretionary spending. That's not to say that you can't pick back up after a few weeks, but stick to essentials until you've given yourself enough time to get comfortable spending money on just those things.</p> <p>The goal is to take away your tendency to be a reactive purchaser, before you take the steps necessary to build yourself back into a proactive budgeter. Once you can go into stores and see ads without feeling that twitch making you want to spend money, you're ready to move on. It'll happen quicker than you think.</p> <h2>2. Make a Weekly Budget</h2> <p>Budgeting is one of the simplest and most basic safety nets you have to protect yourself against impulse spending. There are plenty of ways to do it, like using a <a href="">Dave Ramsey budget sheet</a>. But the general concept is to start by writing down both your expected income and expenses for each month. Separate your expenses between the amounts that are fixed (rent, insurance, etc.) and those that fluctuate (gas, groceries). Use what's left to disperse between savings, discretionary spending, charitable giving, or however you choose to divide it up. That discretionary amount will serve as a safeguard to help limit your ability to spend impulsively.</p> <p>You'll know that there's a limit to what you can spend, thereby making you less likely to buy something on an impulse. Instead, you end up asking yourself the question: &quot;Do I really want to buy this?&quot;</p> <h2>3. Practice Deciding What to Buy Before You Leave the House</h2> <p>After breaking with your bad spending habits, a good habit to get into is to always make a list or at least plan in your mind what you want to buy before you shop. This ensures that you're in control of your purchasing and that you're not being pushed around by products and advertisements that you might see. Make sure you decide specifically what you want to purchase and avoid deviating from that plan. In time, you'll be able to shop around in a way that isn't impulsive. But until you get better spending habits established, it's best to never deviate from intentional expenses.</p> <h2>4. Put Potential Purchases Through a Litmus Test</h2> <p>There will be gray areas that come up regarding whether or not you're being impulsive or if a purchase is actually necessary or beneficial in some way. A good way to figure that out is to come up with a litmus test in the form of a few questions that you can use to figure out whether or not you really need to spend money on something.</p> <ol> <li>Is there room in the budget for it?<br /> &nbsp;</li> <li>Is the purchase redundant (do you already have the item or something similar to it)?<br /> &nbsp;</li> <li>Will it substantially improve your quality of life?<br /> &nbsp;</li> <li>Did you want or need this item before you were made aware of its existence?<br /> &nbsp;</li> <li>What really made you want the item (an ad, visual appeal, need, practical use, etc.)?</li> </ol> <p>These questions can help give you a clearer picture of why you might want to buy something and whether or not that purchase will benefit you in a way that justifies the amount of money needed to acquire it.</p> <h2>Be the One in Control</h2> <p>The underlying problem with impulse spending is that you end up losing control of your money. If products, services or advertisements are completely driving you to spend, then you'll never be able to stop, because those things will always be there. While it's true that those things have an informative impact (i.e. you see a product and can tell it's useful), the bulk of the decision should stem from your own needs and decisions. Thus, learning how to avoid impulse buys will go a long way in freeing up your financial situation and putting you back in control of your money. It's well worth the effort.</p> <p><em>How do you control impulse spending? Please share in comments!</em></p> <a href="" class="sharethis-link" title="How to Never Succumb to Impulse Spending Again" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Mikey Rox</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Budgeting Debt Management budgets impulse spending mindful spending spending Thu, 16 Oct 2014 09:00:08 +0000 Mikey Rox 1236048 at 87% of Homebuyers Think They Know How Much Home They Can Afford (But They Really Don't) <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/87-of-homebuyers-think-they-know-how-much-home-they-can-afford-but-they-really-dont" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Seven years ago, when my husband and I were house hunting, we were sure we knew how much house we could &ldquo;afford.&rdquo; However, once we started really looking at the numbers, and comparing costs to our situation, we discovered that we really didn&rsquo;t have an idea of what we could really afford.</p> <h2>Most Homebuyers Don't Know What They Can Afford</h2> <p>Unfortunately, our experience isn&rsquo;t unique. A recent survey from Discover Home Loans points out that 87% of homebuyers claim they know how much home they can afford. However, as Discover asked about the specific expenses, it found that, like me, many homebuyers don&rsquo;t actually have a clear understanding of the cost involved in purchasing a home.</p> <p>According to the survey&rsquo;s results, only 59% of prospective homebuyers know how much their down payment will be, and only 52% have run the numbers on their monthly mortgage payment. So, even though homebuyers might have an idea of what they <i>think</i> they can afford, the reality is that they don&rsquo;t actually <i>know</i> what those expenses will be.</p> <p>Because your home is likely to be the largest purchase you make in your life, it makes sense to fully understand your options, and have a good handle on exactly what it will cost you, and how much you can truly afford. Let's walk through the process.</p> <h2>How Much Home You Can Afford?</h2> <p>Just coming up with a ballpark figure of how much you think you can afford isn&rsquo;t going to cut it when you get right down to it. Before you start looking at homes, it makes sense to know exactly what numbers you&rsquo;re talking about.</p> <h3>Decide on a Down Payment</h3> <p>First of all, you need to figure out what down payment you can offer. Realize that the lender will trace the origin of your down payment. You aren&rsquo;t generally supposed to borrow the money you use for a down payment. Instead, it should be in the form of a true gift from a close family member, or it should come out of assets that you already have.</p> <h3>Know Down Payment Minimums</h3> <p>If you are getting a loan backed by the FHA, you need at least 3.5% for a down payment. For conventional loans, many lenders like to see 5% or 10% down. If you are building a home, the lender might ask for 20% down. If you only have $10,000 for a down payment that will immediately limit your choices in terms of how much house you can buy. How much the lender requires ultimately depends on your credit, the purchase price, and the purpose of your home purchase (rental property, second home, primary residence, etc.).</p> <h3>Consider the Monthly Payment</h3> <p>You should also consider the monthly mortgage payment, so you can get a realistic view of what to expect in terms of your budget. There are a number of <a href="">useful mortgage calculator resources</a> online that can help you figure out what you will pay each month, depending on the amount you borrow, the interest rate you pay, and your down payment.</p> <h3>Don't Rely on the 30% Rule</h3> <p>What you can afford depends on your comfort level, and your other obligations. While many experts tout the 30% rule, which says that it&rsquo;s &ldquo;affordable&rdquo; to pay 30% of your income on housing costs, the reality is that this is just a rough starting point. Instead, consider what you can handle. My husband and I like to keep all of our housing expenses (including utilities and taxes) to no more than 25% of our monthly income.</p> <p>If you have other obligations, such as credit card debt, car loans, and student loans, it might make sense to get a smaller mortgage &mdash; or even put off buying a home until you have less debt altogether. If you spend 30% of your income on your mortgage and other housing costs, and another 15% of your income goes toward other debt obligations, you are spending 45% of your monthly income on debt. That starts to get fairly uncomfortable for many budgets.</p> <h3>Get Pre-Approval for a Home Loan</h3> <p>Getting pre-approval is a great way to figure out how much home you can afford, said TJ Freeborn, a mortgage professional at Discover Home Loans.</p> <p>&nbsp;&ldquo;Pre-approvals help you shop for your new home with confidence. They greatly reduce any financing surprises and generally give you a leg up in buyer and seller negotiations,&rdquo; wrote Freeborn in her guest article for <a href="">Redfin</a>. &ldquo;Additionally, many real estate agents who are representing home sellers will want you to be pre-approved so that they know you are a viable buyer.&rdquo;</p> <p>To obtain pre-approval, you need to provide your mortgage professional with financial documents including W2s, paycheck stubs and bank statements. These documents will be used by the mortgage professional to verify your income and assets and to run a credit check. Once this review has been completed, your lender will issue you a pre-approval letter that you can share with your real estate agent or seller.</p> <h3>Be Ready for Additional Costs</h3> <p>Another issue that many consumers don&rsquo;t address when considering home affordability is the fact that there are a number of other costs that come with buying a house. If 52% of homebuyers haven&rsquo;t determined how much their monthly mortgage payments will be, as suggested by the Discover Home Loans survey, then it&rsquo;s reasonable to assume that an even greater number hasn&rsquo;t thought about other costs, including closing costs, taxes, fees, and moving expenses.</p> <p>Seven years ago, my husband and I were shocked as the price of our home kept climbing. From property taxes to homeowners insurance to the fact that a bigger house meant higher utility bills, we were surprised at the final cost.</p> <p>As you calculate how much home you can afford, don&rsquo;t just assume that the story ends with the principal and interest from a mortgage payment. Remember that there are other costs as well, and you need to be ready to handle them.</p> <h2>Bottom Line</h2> <p>If homebuyers want to have a true understanding of home affordability, then they should spend some time early in the process ironing out the numbers. With the help of some simple calculators, and a clear picture of personal finances, anybody can make an informed purchase.</p> <p><em>Discover&nbsp;Home Loans has provided me with compensation for&nbsp;my&nbsp;time and efforts on this article. As always, all&nbsp;opinions&nbsp;are 100%&nbsp;my&nbsp;own.</em></p> <a href="" class="sharethis-link" title="87% of Homebuyers Think They Know How Much Home They Can Afford (But They Really Don&#039;t)" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Miranda Marquit</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Real Estate and Housing Discover Home Loans mortgages Wed, 15 Oct 2014 15:00:05 +0000 Miranda Marquit 1233266 at 14 Signs You Have a Toxic Relationship With Money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/14-signs-you-have-a-toxic-relationship-with-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="worried woman bills" title="worried woman bills" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>We obsess over it, we hoard it, we covet it, and we hate it&hellip; all at the same time. Our relationship with money is anything but simple.</p> <p>Ironically, it's that same relationship that influences how much of the green stuff we'll have. Those that maintain a healthy relationship with money typically do very well financially, while those of us that don't? Well, let's just say we struggle more than we should, and not just in the money department. (See also: <a href="">For a Better Relationship With Money, Make Plans</a>)</p> <p>Unhealthy money relationships can typically be classified in one or more of five categories: fear, avoidance, resentment, shame/guilt, and obsession, but they're not always apparent. Sometimes, we have to do a little digging to discover the real cause of our discomfort.</p> <p>So, how can you tell if you have a toxic relationship with money? Here are 14 classic signs that you might need to rethink how you relate to your cash flow.</p> <h2>1. You Resent Spending It</h2> <p>Years and years ago, a relative of mine went through a small financial crisis. Between a mound of credit card debt and an unexpected layoff, money was suddenly tight for a while. Fast forward to the present, and he still behaves as if he were flat broke. He's not of course, but he lives as if he's one paycheck away from losing it all, even though the house is paid for, and he lives comfortably off his retirement.</p> <p>As a result, he doesn't spend money often. He ties knots in broken shoelaces to make them last longer. He adds water to milk so that he doesn't have to buy more. He thinks he's being thrifty, but the truth is, he's created a toxic relationship with his money that brings nothing but stress and grief. In short, he's so worried about losing it, he doesn't have time to enjoy it.</p> <p>Being frugal is one thing, but being bitter about every dime that leaves your pocket is another. If parting with your money &mdash; even for the really important things &mdash; causes you pain, it's time to start looking at why.</p> <h2>2. You Must Spend It</h2> <p>On the flip side, my daughter <em>never</em> has money, despite getting monetary gifts on a regular basis from aunts, uncles, grandparents, and yes, her dad and I. In theory, she should be rolling in the green, but the minute she comes into money, she absolutely has to spend it, even if there's not anything she really, truly wants.</p> <p>We all have those things that we don't really &quot;need,&quot; but we'd love to have, and there's nothing wrong with splurging now and then or treating yourself to something that's not a necessity. But if that urge to buy turns into a need to spend, it's time to be honest about what you think the spending will accomplish.</p> <p>That excitement you experience before and during the purchase isn't going to last and you'll have to find something else to fill the void. Except that it can't be filled &mdash; at least not with &quot;stuff.&quot;</p> <h2>3. You Pay Your Bills at the Last Minute</h2> <p>Are you paying your bills at the last minute because you enjoy seeing the bigger balance in your bank account? Or is it because you're afraid you might end up needing that money for something else, and you're giving yourself the option ahead of time?</p> <p>Or perhaps, like my relative in the story above, you can't stand the idea of parting with your hard-earned cash, and somehow waiting until the last minute is your private &quot;so-there&quot; to your creditors?</p> <p>Whatever the reason, you're creating stress you don't need to have. Get yourself a workable budget and stick to it. You'll be happier as a result and have tons more time to focus on all the &quot;other&quot; drama in your life.</p> <h2>4. You're Constantly Broke (or Short)</h2> <p>You're either living beyond your means or you don't have a workable budget. Either way, this &quot;I have money, now I don't have money&quot; roller coaster means your finances are out of control. You're simply working to survive and have no real plan for how to make your money work for you.</p> <p>Is it an easy fix? It depends on the underlying cause and the sooner you face it, the sooner you can make the situation manageable. Because rest assured, if you don't address it, that roller coaster is going to fly off the tracks sooner or later.</p> <h2>5. You Spend Your Money Before You Get It</h2> <p>You got paid yesterday and you're already pushing bills to your next paycheck, so that things won't be so tight now.</p> <p>This is a variation of the &quot;Always Broke&quot; sign, and it stems from the same toxic money emotion: avoidance. Rather than creating a workable budget, you pay what must be paid now and bump the rest to another payday.</p> <p>Yes, emergencies happen and sometimes this kind of creative financial planning is unavoidable. But if every payday has you doing magic tricks with your bills, there's a deeper problem at play.</p> <h2>6. You Pay the Minimum on Your Credit Cards</h2> <p>Another sign of avoidance, paying the minimum on your credit cards suggests that you're living beyond your means or at the very least, haven't given much thought to your financial future. After all, we all know that paying the minimum isn't getting you anywhere &mdash; you're basically just spinning your wheels.</p> <p>If this is a temporary situation, you can count yourself out of this group. But if paying the minimum is your normal budgeting strategy, it's time to take a serious look at your finances and develop a smarter plan to pay off your debt.</p> <h2>7. You Resent People Who Have Money</h2> <p>There's a very distinct &quot;us vs. them&quot; mentality when it comes to money and if you're on the side that doesn't have it, it can be very frustrating indeed. But there's a difference between concerns over the wealth gap and just hating everyone with money.</p> <p>Speak out about income inequality? Absolutely. Write letters to Congress and march in protest? More power to you. That's the stuff this country was founded on.</p> <p>But if that concern turns to bitter resentment, you need to find a way to let it go. Because it won't make the rich stop being rich, but it will wreak all sorts of havoc on your health, your well-being and your happiness.</p> <h2>8. You Resent People Who Don't Have Money</h2> <p>On the flip side of this &quot;us vs. them&quot; mindset, there are those who have that see those who don't as a drain on society.</p> <p>And without getting too deep into a political debate, let me just say this: Your net worth, as impressive as it may be, is not the mark of success. How you treat people, how you live your life, and how you contribute to the world around you are much, much more important.</p> <p>If you're able to dismiss someone simply because they make less, then you need to rethink your priorities and while you're at it, your relationship with money.</p> <h2>9. You Think (More) Money Will Solve Your Problems</h2> <p>Sure, we've all dreamed of being a gazillionaire and never having to worry about money again, but if you truly see your bank balance as the key to happiness, you're in for a serious disappointment.</p> <p>All too often, we postpone the things we want to be, do, and have because we believe we need more money to make that happen. And while the green stuff can certainly grease the wheels, it's not the end-all, beat-all solution we think it is.</p> <p>In fact, just the opposite is true. Every day, we hear about people accomplishing extraordinary things and money wasn't a factor at all. These people are changing the world, saving the planet, starting new businesses, building families and conquering their fears, and they're doing it without the help of a big bank account.</p> <h2>10. You're Afraid of It</h2> <p>When I first started freelancing full-time, I had a number in my head that I needed to meet. Coincidentally, that number was the same number I had made while working in the corporate world &mdash; it represented my financial comfort zone and as long as I hit that target, I was content.</p> <p>Recently however, I'm feeling pulled to take that business in a different direction. And I have to say, I'm excited about the potential for growth it offers.</p> <p>If only I wasn't afraid.</p> <p>As crazy as it sounds, I've discovered that I'm a little fearful of what that growth might mean. After all, growth means more clients. More clients means more revenue. And more revenue means I'll be stepping out of that financial comfort zone I've come to know and love.</p> <p>Am I being irrational? Perhaps, but fear can cause us to do all sorts of things that are counterproductive to our well-being. I know people who refuse to learn about investing for example, because they're intimidated by what they don't understand. I know people who avoid seeking promotions and raises because they're not sure what new responsibilities that money might bring and more to the point, what if they can't handle those responsibilities? They might lose the new job and be without any kind of paycheck at all.</p> <p>But avoiding the issue isn't going to get you where you want to go; research and education will. The only way I can get past my somewhat ridiculous fear of making more money is to get comfortable with the changes I'll face. And the same is true with all the other money fears we've mentioned.</p> <p>Start small and take it slow if need be, but step outside your comfort zone. Knowledge can help you conquer that fear and build a healthier relationship with money in the process.</p> <h2>11. You Lie About Your Finances</h2> <p>Its one thing to downplay what you make to friends and associates, but quite another if you're lying to your spouse or worse, yourself. We lie because we don't want to admit we have a shopping addiction for example, or because we don't want to disappoint our other half. We're afraid of being judged, of being lectured, of having the argument we know we're going to have when they find out what we spent.</p> <p>But maybe that's a conversation that needs to happen.</p> <h2>12. You Don't Like Talking About It</h2> <p>And since we're on the subject, it has long been considered taboo to discuss financial matters outside your most inner circle of friends and family. And there are a couple of reasons this limitation exists.</p> <p>For some, we don't want to make others &mdash; particularly those with less money &mdash; feel uncomfortable. In other instances, it might be because we're the ones with less money, and we don't want to feel judged. But when this discomfort causes you to stop talking about money altogether &mdash; even with that inner circle &mdash; it's time to address the fear.</p> <p>Talking about money allows you to plan ahead. It enables you to create a better budget, deal with financial surprises and most importantly, develop a healthy relationship with your money. After all, your money is a tool, and the only way to use it effectively is to become comfortable with its existence.</p> <h2>13. You Can't Talk About Anything Else</h2> <p>When you look at the world, you see dollar signs. In fact, your value system is built around how much something costs or how much someone makes. And this obsession will manifest in one of two ways: you're either driven to make more and spend more because you feel it increases your status or you're exceptionally frugal and don't mind telling the world every time you saved a dime.</p> <h2>14. You Haven't Taken a Vacation, Bought a Car, Updated Your Wardrobe in Years</h2> <p>If you thought that relative with the broken shoelaces had gone to the extreme, you'd be right, but the mentality that pushes him to hoard his money is the same basic mentality that keeps you from enjoying life.</p> <p>When was the last time you took a vacation? Bought a new car? Bought yourself anything nice?</p> <p>Yes, I realize that's much easier to do when you have extra money to spend, but even the tightest budget should be able to accommodate at least some small &quot;treat&quot; for yourself now and then. A magazine, a new tube of lipstick, a new pair of shoes (even if they're off the clearance rack).</p> <p>If you don't spend on yourself once in a while, you're basically working just to pay your bills. And what's the point in that?</p> <p><em>Now it's your turn: How do you define your relationship with money? And how do you deal with hangups along the way?</em></p> <a href="" class="sharethis-link" title="14 Signs You Have a Toxic Relationship With Money" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Kate Luther</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Personal Finance emotion money money attitudes money relationships Tue, 14 Oct 2014 21:00:07 +0000 Kate Luther 1233264 at Smart Investors Have These 6 Traits — Do You? <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/smart-investors-have-these-6-traits-do-you" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="investor" title="investor" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's hard to be a good investor. By some estimations, only 20% of people involved in the investment business are <a href="">successful in their own investing endeavors</a>.</p> <p>And while there are careers' worth of research and education that go into making savvy investments, in the end, much of it may come down to character traits.(See also: <a href="">A Lot of People Don't Really Understand What an Investment Is &mdash; Do You?</a>)</p> <p>So check out this list of characteristics successful investors must have, and see how you stack up before hitting the market.</p> <h2>1. Smart Investors Are Patient</h2> <p>To be successful in investing, you need to be patient. In general, the market rises slowly, and you have to be willing to take the long view of your investments in order to see them grow. If you believe in an investment and you have done your research on it enough to know that it's a wise buy, then you have to be willing to wait to see your return.</p> <p>A lot of investors, especially new investors, fall into the trap of checking on their investments several times a day. It's hard to be patient when you're seeing all the little rises and falls that many investments take every day. So keep yourself away from the computer if you can, or at least limit the number of times a day you check in.</p> <h2>2. Smart Investors Are Planners</h2> <p>Before they even buy an investment, smart investors have a plan. They know what their ultimate goals are and they have some idea of how they want to get there. They know the benefits and drawbacks of different types of investments, and they know how to choose between them. To a certain extent, they also have contingency plans. They know how to access money if they need it, and they know what they will do if the market crashes or a particular strategy doesn't play out.</p> <p>If you don't feel confident in making your own plan, it can be worthwhile to consult with an investment professional you trust. While this will cost something, it gives you the chance to get an opinion from someone who has more training than you do. If you're wary of getting a biased opinion, interview several professionals before you decide who to work with. Make sure you feel like you can trust someone before you take their financial advice.</p> <h2>3. Smart Investors Are Disciplined</h2> <p>Smart investors know that their plan is better than any impulsive ideas they might have with their money, and they have the discipline to absorb those ideas and stick with their plan anyway. They know that something that looks too good to be true probably is, and they know that their plan is probably better in the long run, anyway. These investors keep their long term goals in view whenever they're thinking about their money, and they don't do anything that might keep them from achieving those goals.</p> <p>If you struggle with discipline or you aren't sure you will be able to stick with your plan, find an investing buddy. This can be a spouse or a close friend. It should be someone who you feel safe sharing your financial situation with. Then, you commit to talking to them about anything before you make a change to your investments or strategy. This can help you think long enough to realize something might not be a good idea, and it gives you a chance to have accountability for making good choices.</p> <h2>4. Smart Investors Are Ambitious</h2> <p><a href="">Ambition helps you find success</a> in many parts of life, and investing is no different. Ambitious investors are willing to take as much risk as they can afford, so they can reap a maximum benefit when their investments pay off. They push the envelope in order to achieve their goals, because their goals are high and there isn't a better way to achieve them. This also pushes smart investors to stay in the game and enhance their understanding of what works and what doesn't, so they can do what they set out to do.</p> <p>If you struggle with ambition, start working on developing positive feelings about yourself. People who feel good about themselves are more likely to be ambitious. This makes a lot of sense. When you feel good about who you are, you will feel good about what you can do, both now and in the future. If you don't feel good about who you are, you won't be ambitious because you will feel like there's no way you can achieve those goals.</p> <h2>5. Smart Investors Are Adaptable</h2> <p>A smart investor needs to be able to adapt to changing market conditions, new trends, and different ways of doing business. They need to be able to evaluate these in light of their long term plan, to decide when, how, and to what extent they should incorporate new things into their overall investment strategy.</p> <p>But wait? Didn't I just say that investors need to commit to their strategy in spite of distractions? Smart investors know the difference between a fleeting trend and a new way of doing business that is around to stay. Sometimes this means observing for a while before they jump in. Other times, it means trusting their intuition, and that of any investment advisors or friends they might have. It also means jumping in in a smart way &mdash; this can mean starting small, investing only a small portion of their overall money in something new, and being able to articulate how the new ties in with the old and enhances their investment plan.</p> <h2>6. Smart Investors Trust Their Intuition</h2> <p>Intuition can be a testy thing, but smart investing means, sometimes, trusting in a way of knowing that is separate from rational understanding. This is different than trusting in your wishes or your hopes or your dreams. Intuition seems to be an alternate way of knowing things, a way of seeing problems and solutions that cuts through a lot of the clutter that &quot;thinking rationally&quot; can provide, and knowing an answer without necessarily knowing how you got there. That doesn't mean that something known intuitively doesn't make sense, but that <a href="">the knower won't necessarily know how it makes sense</a>.</p> <p>If you don't yet know which of your thoughts are intuition and which are hopes, dreams, or wishes, take some time before you make decisions based on it. Instead, note the ideas that you have, the things that seem to stand out or financial decisions that seem like they might be a good idea even though they're different from your usual way of operating. Then keep track of how those decisions play out. Over time, you'll learn which impulses are intuition and which ones come from some other internal place.</p> <p><em>Do you consider yourself a smart investor? What trait do you have that makes you a better investor?</em></p> <a href="" class="sharethis-link" title="Smart Investors Have These 6 Traits — Do You?" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Sarah Winfrey</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Investment Personal Development habits investing money management Tue, 14 Oct 2014 13:00:04 +0000 Sarah Winfrey 1235003 at 11 Reasons Your Credit Card Application Was Denied — And What You Can Do About It <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/11-reasons-your-credit-card-application-was-denied-and-what-you-can-do-about-it" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="credit declined" title="credit declined" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p><a href="">About 7% of Americans</a> have been rejected for a credit card in the past 12 months.</p> <p>This is about 17 million Americans, a number that went up by 3% from the previous period. The key to turning things around is to have a better understanding about why those credit card applications are being denied. Some of the reasons are not as intuitive as you may think.</p> <h2>1. You've Made Too Many Credit Applications</h2> <p>When you are just starting to build your credit history, it is often a good idea to get a credit card. Responsible management of a credit card helps to build up your credit score. However, like anything else, too much of a good thing can be harmful.</p> <p>Every time you apply for a card, a lender has to do a hard inquiry on your credit history and that lowers your score by a little bit. Inquiries remain on your credit history for two years. However, credit scores, such as FICO, only consider those <a href="">hard inquiries within the last 12 months</a>. This is why it is a good idea to wait 12 months before opening a new card.</p> <h2>2. Your Credit Utilization Is Too High</h2> <p><a href="">Most financial advisors recommend that your credit utilization should be about 30%</a>. That means that if you have a line of credit of $1,000, you are only using $300. If your credit utilization is above that threshold, lenders believe that you have a higher probability of not meeting your monthly payments, or, even worse, defaulting on all your liabilities. Maintaining a credit utilization rate above 50% for a long time is a surefire way to get your credit card application denied.</p> <p>To fix this, pay down those high credit card balances to 30% of your credit limit. Once you reach that goal, start working on getting them to 0%. Another alternative is to check if your lender will increase the limit of your credit card. (See also: <a href="">This One Ratio Is the Key to Your Credit Score</a>)</p> <h2>3. Your Income Is Too Low</h2> <p>On the other hand, even if you have a low credit utilization, your application may still be denied.</p> <p>For example, let's imagine that you have a card with a limit of $10,000 and a balance of $3,000. When you opened that credit card, you presented a W2 showing that you were making about $4,000 per month. A year later you apply for a new card but now you have a monthly income of $1,500. Now, your <a href="">debt-to-income ratio</a> (DTI) is too high, and an agent may decide to deny your application.</p> <p>To prevent this scenario, <a href="">calculate your DTI and keep it well below 43%</a>. The only two ways to improve your DTI are to either pay down debt or increase your income.</p> <h2>4. Your Account Age Is Too Young</h2> <p>Some people have a hard time resisting the temptation of using their credit cards and, in hopes of preventing further spending, close down their accounts. This is a bad idea because <a href="">closing accounts lowers their average age</a>.</p> <p>Therefore, aim to pay down your balances and leave those credit cards open. And never close your oldest credit card, even if you don't used it anymore. If you have no other card that you have been holding as long, <a href="">your credit score may take a hit</a>.</p> <h2>5. Your Public Records</h2> <p>Your credit report includes a lot of information about your credit history, including public records and collections. Credit card companies regard public record negatives on your credit report as big drawbacks. (See also: <a href="">How to Get a Credit Card When You Have Bad Credit</a>)</p> <p>Some examples of negative public records are:</p> <ul> <li>Chapter 7 and Chapter 13 bankruptcies;</li> <li>Unpaid tax liens;</li> <li>Civil judgments or court orders forcing you to pay monies to another party;</li> <li>Unpaid traffic violations and library fines.</li> </ul> <p>Most public records stay on your credit record for at least seven years, and some, such as Chapter 7 bankruptcies, stay for 10 years. If you have an unpaid tax lien, make sure to pay it within seven years or it will stick on your record for 10 years. If you think that there is a mistake on your list of public records, <a href="">file a credit recording complaint</a>.</p> <h2>6. You Have Had Some Charge-Offs</h2> <p>Besides a negative public record, a charge-off is the next worst possible thing to appear on your credit report. When a lender charges off your account, it is writing off the debt as a loss and has given up on getting you to pay.</p> <p>While a charge-off may sound like great news for you, it is far from that. Not only does a charge-off stay on your credit report for seven years, but it also becomes a roadblock to getting a mortgage or loan application approved. Your best option is to contact the creditor and work out a <a href="">lump-sum payment or installment plan in exchange of getting the charge-off removed</a>. Make sure to get the agreement in writing.</p> <h2>7. You're a Minor</h2> <p>If you are younger than 18 years old, you may not get a credit card on your own. The main reason is that minors cannot enter a legally binding agreement, which is what a credit card agreement is. This is why some very conservative financial institutions may even decline to issue a credit card to anybody younger than 21, including <a href="">emancipated minors</a>.</p> <p>The only way for a minor to get a credit card is to become the <a href="">authorized user of a credit card</a> held by a parent or legal guardian. If used responsibly, the authorized credit card enables the minor to start building his or her credit history. However, rules have to be clearly set, or this is a proposition that can end in disaster. (See also: <a href="">What You Need to Know Before Getting Your First Credit Card</a>)</p> <h2>8. You Have No Pay Stub or W2</h2> <p>Some credit card companies may take your word regarding your income, but most of them require proof of income. The only acceptable documents are pay stubs, W2s, or copies of federal tax returns.</p> <ul> <li>If you are asked to present proof of income and you are not able to produce one (e.g. recent company hire, no prior tax filings), then you may have to wait until you can get one.<br /> &nbsp;</li> <li>In the case of self-employed or freelancing individuals, you may have to wait until your next tax filing. Make sure to request 1099-MISC forms, whenever applicable, because they help a lot to show revenue.<br /> &nbsp;</li> <li>Seek the advice of a professional accountant to determine the best way to provide proof of income to lenders.</li> </ul> <h2>9. You Hop From Job to Job</h2> <p>Even if you are able to produce all of your W2s and pay stubs, a credit card agent may see your inability to hold down a job as a problem. The rationale is that you may not have the necessary steady stream of cash inflows to meet your monthly payments.</p> <p>Never lie about how long you have held a job on a credit card application because companies often call employers to verify information. To squash doubts about your commitment to your current position, you can bring a letter from your employer or a signed contract binding you for several months.</p> <h2>10. You Already Have Too Many Cards</h2> <p>This is a tricky reason. While there is no rule of thumb as to how many cards is too many, the number is the one that makes it difficult for you to responsibly handle your cards. (See also: <a href="">How Many Credit Cards Should You Carry?</a>)</p> <p>For some people, the ideal number may be two: a main card and a &quot;backup&quot; card. For others, it may be three: one for <a href="">air miles</a>, another for <a href="">cashback</a>, and another for main use. The key is to aim for a number that allows you to keep a credit utilization ratio below 30% and a debt-to-income ratio below 43%.</p> <h2>11. Your Application Is Incomplete</h2> <p>Yes, this can happen to the best of us. When receiving an <a href="">incomplete credit card application</a>, a company has two options. One is to issue a notice of adverse action and the other is to issue a notice of incompleteness, stating what is necessary to process the application.</p> <p>So, make sure to cross your t's and dot your i's before turning in that credit card application.</p> <p><em>Have you ever had a credit application denied? How did you fix it?</em></p> <a href="" class="sharethis-link" title="11 Reasons Your Credit Card Application Was Denied — And What You Can Do About It" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Damian Davila</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Credit Cards bad credit credit application credit score denied credit good credit Mon, 13 Oct 2014 13:00:06 +0000 Damian Davila 1231314 at Best Money Tips: Secrets to Save Money on Gas <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-secrets-to-save-money-on-gas" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="gas station" title="gas station" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="">Best Money Tips</a> Roundup! Today we found some amazing articles on secrets to save money on gas, things you'll be proud of doing, and things you are likely paying too much for.</p> <h2>Top 5 Articles</h2> <p><a href="">10 Secrets to Save Money on Gas</a> &mdash; To save money on gas, take advantage of grocery shopping rewards and don't wait until you are on empty to fill up. [BargainBabe]</p> <p><a href="">17 Things You'll Be Proud of Doing</a> &mdash; Chances are you'll be proud of yourself for setting aside time for loved ones. [PopSugar Smart Living]</p> <p><a href="">5 Things You Are Likely Paying Too Much For</a> &mdash; It is likely that you are paying too much for gas and entertainment. [Three Thrifty Guys]</p> <p><a href="">How to Make Money Selling at Consignment Sales</a> &mdash; It is important to carefully clean your items before you sell them at a consignment store. [Stapler Confessions]</p> <p><a href="">3 Key Moments When Your Credit Score Matters</a> &mdash; Did you know that your credit score matters when you are moving? [Credit Karma]</p> <h2>Other Essential Reading</h2> <p><a href="">How to Convert Employer-Paid Insurance to an Individual Policy Upon Layoff</a> &mdash; If you want to convert your employer-paid life insurance to an individual policy, check for a conversion provision. [Money Smart Life]</p> <p><a href="">The Top Ways to Fund Your New Business</a> &mdash; When finding funding for your new business, consider borrowing money from the SBA. [Investopedia]</p> <p><a href="">I Want Christmas to Be Debt-Free</a> &mdash; To keep your Christmas debt-free, opt out of gift exchanges and don't buy &quot;hot&quot; gifts. [Get Rich Slowly]</p> <p><a href="">Planning a Fun, Frugal Halloween</a> &mdash; Keep your Halloween fun and frugal by making your own costume and using what you already have to decorate. [Five Cent Nickel]</p> <p><a href="">5 Ways to Instantly Make a House Feel Like a Home</a> &mdash; Embracing knick knacks can make your house feel like a home. [Parenting Squad]</p> <a href="" class="sharethis-link" title="Best Money Tips: Secrets to Save Money on Gas" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Ashley Jacobs</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Cars and Transportation best money tips Cars gas saving Fri, 10 Oct 2014 19:00:05 +0000 Ashley Jacobs 1231316 at The 5 Best Reasons to Start Investing in Bonds Now <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-5-best-reasons-to-start-investing-in-bonds-now" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="us bonds" title="us bonds" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Everyone talks about investing in stocks, but smart investors do not ignore bonds. Read on, and maybe you'll agree that it's high time you start bonding with bonds thanks to these five basic bond benefits. (See also: <a href="">A Low-Risk Investment Plan</a>)</p> <h2>1. Diversification</h2> <p>Bonds can increase your financial safety by diversifying your portfolio because <a href="">stocks</a> are <a href="">prone to volatility</a> while <a href="">bonds </a>tend to be more stable.</p> <p>By holding bonds, in addition to stocks and other investments, you're not putting all your eggs in one basket. Although stocks can go up, they can also go down &mdash; sometimes a lot.</p> <p>Plus, <a href=";_Bond_Prices_Move_in_Opposite_Directions%3F">bonds often do better</a> when stocks are doing badly. While stocks represent ownership in companies, bonds are essentially loans. Governments, utilities, and companies issue, or sell, bonds when they want to borrow money. When you buy a bond, you're lending money to them. The values of the two investments are based on different factors. In times of uncertainty, investors flee stocks and buy safe, high-quality bonds. In times of economic growth, investors typically buy stocks but increasing interest rates can push bond prices down.</p> <h2>2. Steady Income</h2> <p>Bonds can provide consistent income, a great benefit for retirees. Unless the borrower defaults, investors will be paid, typically twice a year. On the other hand, companies are under no obligation to pay stock owners a dividend.</p> <h2>3. Liquidity</h2> <p>Most bonds, especially those of large companies and the U.S. government,&nbsp;offer liquidity, meaning they can easily be converted to cash. Popular bonds can easily be sold if the investor needs the money for another purpose and wants to cash out.</p> <h2>4. Legal Protections</h2> <p>Bond holders are more likely than stock investors to get their money back if a company goes bankrupt. In a bankruptcy court, bond investors have priority over shareholders in claims on the company's assets. Structured bonds get first priority over unsecured and subordinate bonds.</p> <h2>5. Tax Benefits</h2> <p>Some government bonds offer tax benefits, especially beneficial for high-income earners in states with high income taxes. Interest from municipal bonds, or &quot;munis,&quot; is not subject to federal taxes. And investors generally don't pay state or local taxes on interest from municipal bonds in their own state.</p> <h2>And Now for the Risks</h2> <p>Bonds are attractive for the reasons noted above, but they are not without risk.</p> <h3>Interest Rate Risk</h3> <p>Rising interest rates pose a risk to all types of bonds. When interest rates go up, the value of bonds go down. That's because investors prefer to buy new bonds with higher yields, rather than older bonds with lower rates.</p> <p>Detractors say interest rate risk is a major risk. If rates rise and you sell a bond, you will lose money. But remember if you keep the bond until its maturity, you continue getting interest payments and then get your principal back as expected as long as the issuer doesn't default.</p> <h3>Default or Credit Risk</h3> <p>Default or credit risk is the risk that the company or city (remember Detroit?) could go bankrupt and not make payments. Naturally, companies regarded as riskier pay higher rates, while those seen as safer, like the U.S. government, pay lower rates. Investors can gauge default risk by examining ratings from credit rating agencies like <a href="">Standard &amp; Poor's</a> and <a href="">Moody's</a> and mitigate risk by creating a diversified portfolio.</p> <h3>Fun With Funds</h3> <p>Since most people don't have enough money to buy a slew of bonds, they instead <a href="">buy bond mutual funds</a>, frequently through employer-sponsored 401(k) plans that allow them to commit small amounts over time. These funds offer professional management and diversification by pooling the money of many investors.</p> <p>For your first bond fund, experts typically recommend a <a href="">blended fund</a> holding a mix of different types of bonds, such as government, corporate and international bonds, and bonds with a range of maturities.</p> <p>Don't just jump on a fund with the highest yield. That probably means it's highly risky. You don't need to completely avoid risk, but it's important to know what you're getting into.</p> <p>Look at the fund's credit risk by checking the percentage of AAA bonds it holds versus lower-rated and non investment-grade bonds.</p> <p>Longer duration means greater sensitivity to interest rate risk.</p> <p>Most importantly, consider its <a href="">fees and expenses</a>, including back-end redemption fees.</p> <h3>A Few More Bond Basics</h3> <p>You know the benefits, you know the risks. But before you get out your checkbook, you should also understand some essential facts and definitions about bonds and what determines their value. Knowing about coupon rates, maturities, yields and prices, and how they are inter-related, is key to understanding the investments.</p> <p>The <em>coupon rate</em> is the interest rate the bond issuer (the borrower) pays the investor (the lender).</p> <p>The <em>maturity</em> is when the bond term ends and investors get their principal back &mdash; in other words, when the loan ends. Bonds maturing within five years are considered short-term bonds. Those maturing in 10 years or more have long terms.</p> <p>Because of changing interest rates, when bonds trade they frequently sell at <em>premium</em>, or more than its face value, or at a <em>discount</em>, or less than its face value.</p> <p>Bond prices are expressed as a percentage of its face value, also called <em>par value</em>. For instance, one with a par value of $1,000 selling for 90 is worth $900.</p> <p>The <em>nominal yield</em> is the same as the coupon. But the <em>current yield</em>, a more important figure, is the yearly interest divided by what the investor paid for it. For example, a $1000 bond with a coupon rate of 5% that was purchased at a discount of 90 would have a current yield of 5.5%.</p> <p>And finally, <em>yield to maturity</em>, a more advanced calculation, is used to compare different bonds. It takes into account the bond's price and assumes it's held until maturity.</p> <p><em>Have you added bonds to your portfolio?</em></p> <a href="" class="sharethis-link" title="The 5 Best Reasons to Start Investing in Bonds Now" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Michael Kling</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Investment bond funds bond terms bonds mutual funds Fri, 10 Oct 2014 13:00:05 +0000 Michael Kling 1230392 at Best Money Tips: Ways to Deal With Student Loan Debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/best-money-tips-ways-to-deal-with-student-loan-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="sad graduate student" title="sad graduate student" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Welcome to Wise Bread's <a href="">Best Money Tips</a> Roundup! Today we found some awesome articles on dealing with student loan debt, feeling less stress, and money moves for the fall.</p> <h2>Top 5 Articles</h2> <p><a href="">15 Ways to Deal with Student Loan Debt</a> &mdash; To deal with student loan debt, take advantage of your grace period and understand your loans.[The Simple Dollar]</p> <p><a href="">11 Ways to Let Go and Feel Less Stress</a> &mdash; Saying less and breathing more when you are angry can help you feel less stress. [Marc and Angel Hack Life]</p> <p><a href="">5 Money Moves for Fall</a> &mdash; Now that fall is here, start saving for the holidays and shopping strategically. [MintLife Blog]</p> <p><a href="">The 4 Key Components of Every Time Management System</a> &mdash; Every time management system has a todo list and calendar.[Time Management Ninja]</p> <p><a href="">Why Getting Out of Debt Is So Hard (and What to Do About It)</a> &mdash; The secret to getting out of debt is to not quit, keep trying! [MoneyPlan SOS]</p> <h2>Other Essential Reading</h2> <p><a href="">Why We Need to Approach Life With the Mindset of a Student</a> &mdash; Students have the mindset to learn new disciplines and ideas. [Out Of Your Rut]</p> <p><a href="">The Top 10 Things That Could Make a Wedding a Disaster</a> &mdash; Running out of food and having your guest list become out of control can make your wedding a disaster. [Lifehack]</p> <p><a href="">5 Things We All Do That Over Complicates Our Lives</a> &mdash; Taking pride in working hard may be over complicating your life. [Dumb Little Man]</p> <p><a href="">11 Extraordinary Uses for Ordinary Club Soda</a> &mdash; Did you know the minerals in club soda makes it better for plants than actual water? [PopSugar Smart Living]</p> <p><a href="">5 Books to Help Prepare Your Preschooler for Her Education</a> &mdash; To help your preschooler prepare for their education, read the &quot;I Am&quot; series with him or her. [Parenting Squad]</p> <a href="" class="sharethis-link" title="Best Money Tips: Ways to Deal With Student Loan Debt" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Ashley Jacobs</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Debt Management best money tips debt loan student loans Thu, 09 Oct 2014 19:00:04 +0000 Ashley Jacobs 1230391 at 5 Things People Who Are Good With Money Never Say <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-things-people-who-are-good-with-money-never-say" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="woman paying bills" title="woman paying bills" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Head to the self-help section of any bookstore and you'll find a whole row of books about how your mindset is what is preventing you from getting what you want in life. It's a really appealing concept. Imagine if the only thing standing between you and love, wealth, and happiness were the way you looked at the world. (See also: <a href="">8 Things People With Good Credit Never Do &mdash; Do You?</a>)</p> <p>Wait &mdash; it kind of is, at least where money's concerned. While I don't think a change in mindset is any guarantee you'll make millions (no matter what those self-help books say), it can help you make more of what you've got. That may not be as dramatic, but it can have a pretty powerful impact on your bottom line.</p> <p>How do you talk about money? Here are five things that people who are really good at managing their money never say &mdash; and why you shouldn't say them either.</p> <h2>1. &quot;I Don't Have Enough Money to Save&quot;</h2> <p>Yes, the less money you make, the harder it is to save some. But unless you're falling short in terms of paying for a modest place to live and enough food to eat, you can probably scrape together at least a few dollars per month. In fact, the average American apparently has more than<a href=""> $12,000 in discretionary income each year</a>. Whether you're on the low end or the high end of that range, it suggests that many of us have money to save; we just choose not to. Plus, saving is a habit. If you make one now, it'll pay off more and more over time. (See also: <a href="">37 Savings Changes You Can Make Today</a>)</p> <h2>2. &quot;Investing Is Too Complicated&quot;</h2> <p>Investing isn't rocket science. It's just easier to believe that it is. That way, you don't have to actually, like, <em>do</em> it.</p> <p>You know that thing that you learned that seemed really complicated and difficult at first, and now it seems so easy that you can't believe you were ever so intimidated by it? Yeah. Investing's like that. People who are good with money &mdash; or at least good at making it grow &mdash; tend to go in and try to learn all they can. Then they practice and learn and make mistakes and, ultimately, become investors. The truth is that investing isn't hard; it's just hard work.</p> <h2>3. &quot;I Can Either Enjoy the Present or Save for the Future&quot;</h2> <p>Nice try, but actually, people who are good with their money balance both. Should you save money for emergencies, retirement and future desires? Absolutely. Should you do it to the exclusion of every little indulgence? Absolutely not. And you shouldn't just avoid this route because it's austere, and sad and more than little ascetic. You should avoid total self denial because for most people, it just isn't a sustainable long-term strategy. So save your money for the future. Just be sure to enjoy a little bit now too, OK?</p> <h2>4. &quot;If Only I Had X, I Would Be Happy&quot;</h2> <p>Money can buy so many things that it often becomes a proxy for happiness. If I had X dollars, I could do Y and I would happy. And maybe you would be. For a while. The problem is that once you get Y, it probably won't be long before you're looking for Z.</p> <p>Now, I won't go as far as to say that money can't buy happiness. It's definitely a big piece of the puzzle. But people who are really good with their money know that it's just one piece. If only we could buy something that would solve all of our problems, right? It's a great fantasy. But people who are good with their money know that it's just that.</p> <h2>5. &quot;I Can't Afford It&quot;</h2> <p>The term &quot;afford&quot; is entirely subjective. What I mean by that is that even the very richest people &mdash; the top of the top in terms of income &mdash; have limits. Sure, those limits may include a mega mansion, or a private zoo, or a whole island, but there's still a limit somewhere. All wealth is finite. So, whether you have a lot of money or just a little, your financial life is about making choices.</p> <p>Rather than feeling sorry about what you think you can't afford, think about it from the perspective of what you <em>want</em> to afford. If you want to travel around the world, you can afford to do that &mdash; but you just might have to give up your house and your car and your cushy salary to do it. If you want to retire early, you can make that happen &mdash; but it'll probably mean working more hours and taking fewer vacations along the way. Rather than looking at life in terms of what is unattainable, people who are really good with money look at what they want, figure out how much it'll cost, and do what it takes to make it happen.</p> <p><em>Do you know people who are good with money? What are some of the things you never hear them say? Share them in the comments!</em></p> <a href="" class="sharethis-link" title="5 Things People Who Are Good With Money Never Say" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Tara Struyk</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Personal Finance investing money habits money lessons saving Thu, 09 Oct 2014 13:00:03 +0000 Tara Struyk 1229269 at 6 Thoughts Everyone Has Their First Day of Retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-thoughts-everyone-has-their-first-day-of-retirement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="" alt="man thinking" title="man thinking" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It's a major milestone in anyone's life: retirement. You spend so many hours dreaming about just what you'll do with the time, that when it happens, you often aren't prepared for the reality of it. Retirement isn't always the answer to the unfulfilled life that many expect it to be, however, and some even struggle with the new way of life. (See also: <a href="">12 Things You Don't Know About Retirement</a>)</p> <p>Getting a handle on the new feelings can take time. Here are a few of the initial reactions to the new season, along with some tips for keeping everything in perspective.</p> <h2>1. What Will I Do With All the Time?</h2> <p>Going from a full-time career to no job at all can be a jarring experience, one that can even feel like a loss to some. In addition, &quot;Many new retirees are concerned about how they will fill up their new found free time after retiring,&quot; says Hank Coleman, publisher of the popular site, <a href="">Money Q&amp;A</a>. &quot;It can be beneficial for new retirees to take retirement for a test drive. You may want to consider a mini-retirement for a few months before you take the plunge full-time. Maybe you have a hobby or a side business that you want to pursue. Use some of your vacation days before retiring to try out what you'll be doing when you finally cut the work cord for good.&quot;</p> <h2>2. How Can I Stay On Track With My Nest Egg?</h2> <p>Outliving your retirement savings is a legitimate concern for many, and it's one that shouldn't be overlooked. Even if you've done the math and are confident that you can make your savings last, it's best to continue using a budget and assess your progress at least every six months. Check in with your accounts at the end of each year, and see how tax changes, new Medicare laws, or other legislation could positively or negatively affect your monthly living expenses. Make adjustments as needed.</p> <h2>3. Should I Stay or Should I Go?</h2> <p>If your retirement plans included getting away, or possibly even moving, it may be tempting to do so right away. Like any expensive or life-changing decision, however, it's always good to go into it informed. And while plenty of websites are always stating their opinions on the top locations to retire, the logistics of uprooting your home in your retirement years can be stressful. Things to consider &mdash; in addition to cost of living or climate &mdash; should include proximity to the family that may care for you in your older years. (See also: <a href="">5 Incredible Places to Retire Abroad That Anyone Can Afford</a>)</p> <h2>4. Who Am I Now?</h2> <p>If you took pride in your career, or simply identified with your occupation for so long that you don't have a world outside of it, it may be tempting to consider yourself as &quot;just a retiree.&quot; It's not necessary to consider yourself so closely tied to your profession &mdash; or lack of. Start to take inventory of your gifts, skills, and character traits outside of your 9-to-5; you may be surprised to find that you can have an identity built on the kind of person you are, despite having just considered yourself the sum of our working years.</p> <h2>5. How Will This Affect My Relationships?</h2> <p>&quot;When a man retires, his wife gets twice the husband but only half the income.&quot; &mdash; Chi Chi Rodriguez&quot;</p> <p>This vintage joke never gets old, and it couldn't be truer. One of the toughest adjustments to retirement happens when couples find they instantly have more hours in their day to spend together. For the entrepreneur or couple who works with their significant other already, it's not as dramatic as the office worker who now gets to see their partner for an additional 50 or 60 hours a week. Don't feel that you have to spend it all together, however; many couples find that having separate hobbies well into their retirement is the key to a happy rest of their lives together.</p> <h2>6. Is This It?</h2> <p>Retirement should be celebrated, but for many, it also gets them thinking about death. The final years of life &mdash; whether they be just a few, or more than 30 &mdash; can be met with anxiety and uncertainty. (See also: <a href="">Don't Let Poor Health Kill Your Retirement Fund</a>)</p> <p>One way to combat the tensions and worry that some new retirees face is to made a proactive plan toward preventative health care and finding hobbies that can prolong life. Activities around exercise, healthy foods, or relieving stress can be enjoyable well into old age, and they are just the sort of things that can help make the later years vibrant, too. Look for other retirees to share these experiences with; signing up for a seniors cooking class, for example, can give life skills for meeting upcoming health challenges and can introduce you to new faces to spend those work-free days with.</p> <p><em>Are you retired? What did you think on your first days of retirement?</em></p> <a href="" class="sharethis-link" title="6 Thoughts Everyone Has Their First Day of Retirement" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="">Linsey Knerl</a> and published on <a href="">Wise Bread</a>. Read more <a href=""> articles from Wise Bread</a>.</div></div> Retirement retirement planning retiring where to retire Wed, 08 Oct 2014 13:00:04 +0000 Linsey Knerl 1227988 at