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Ten Rules for Successful Money Management

July 23rd, 2015 | No Comments | Posted in Financial News

Always remember that the most important factor in using money wisely is not how much money you make, but how you manage your spending! Here are ten rules that can help you achieve financial success.

  1. PrintArrange a family system for handling money and make certain that everyone in the family is involved and understands it.
  1. Make a spending plan suited to your own income and needs. Don’t try to follow others – a spending plan is a personal system to help you and your family.
  1. Decide on your family’s most important goals. Spend your money on things that will care for your family’s welfare and happiness. Take a minute to decide how important it really is to you and your family, before you make the final purchase.
  1. Plan ahead for the entire year. A financial picture of your entire year will be a great guide and can help to meet your family’s financial goals.
  1. Include all of your income and expenses. It’s usually easy for families to determine their income, but getting a grasp on expenses can be more challenging. Keeping receipts will help you track what you spend more accurately.
  1. Use credit wisely. Don’t spend more on credit than you can afford to pay on a monthly basis. Responsible use of credit cards will help you establish a solid credit rating and avoid financial problems.
  1. Pay yourself first by trying to save 10% of your income. If you can’t afford 10%, start with a smaller amount. Treat savings as a monthly bill.
  1. Stick to your plan, but don’t be afraid to alter your program if you think it needs improvement. Never give up! Be determined and succeed.
  1. Review your plan once a month.
  1. Hold family meetings to review the progress together.

Mid-Life Money Errors

July 23rd, 2015 | No Comments | Posted in Financial News

If you are between 40 & 60, beware of these financial blunders & assumptions.

ss_165338237Between the ages of 40 and 60, many people increase their commitment to investing and retirement saving. At the same time, many fall prey to some common money blunders and harbor financial assumptions that may be inaccurate.

These errors and suppositions are worth examining, as you do not want to succumb to them. See if you notice any of these behaviors or assumptions creeping into your financial life.

Do you think you need to invest with more risk? If you are behind on retirement saving, you may find yourself wishing for a “silver bullet” investment or wishing you could allocate more of your portfolio to today’s hottest sectors or asset classes so you can catch up. This impulse could backfire. The closer you get to retirement age, the fewer years you have to recoup investment losses. As you age, the argument for diversification and dialing down risk in your portfolio gets stronger and stronger. In the long run, the consistency of your retirement saving effort should help your nest egg grow more than any other factor.

Are you only focusing on building wealth rather than protecting it? Many people begin investing in their twenties or thirties with the idea of making money and a tendency to play the market in one direction – up. As taxes lurk and markets suffer occasional downturns, moving from mere investing to an actual strategy is crucial. At this point, you need to play defense as well as offense.

Have you made saving for retirement a secondary priority? It should be a top priority, even if it becomes secondary for a while due to fate or bad luck. Some families put saving for college first, saving for mom and dad’s retirement second. Remember that college students can apply for financial aid, but retirees cannot. Building college savings ahead of your own retirement savings may leave your young adult children well-funded for the near future, but they may end up taking you in later in life if you outlive your money.

Has paying off your home loan taken precedence over paying off other debts? Owning your home free and clear is a great goal, but if that is what being debt-free means to you, you may end up saddled with crippling consumer debt on the way toward that long-term objective. In June 2015, the average American household carried more than $15,000 in credit card debt alone. It is usually better to attack credit card debt first, thereby freeing up money you can use to invest, save for retirement, build a rainy day fund – and yes, pay the mortgage.1

Have you taken a loan from your workplace retirement plan? Hopefully not, for this is a bad idea for several reasons. One, you are drawing down your retirement savings – invested assets that would otherwise have the capability to grow and compound. Two, you will probably repay the loan via deductions from your paycheck, cutting into your take-home pay. Three, you will probably have to repay the full amount within five years – a term that may not be long as you would like. Four, if you are fired or quit the entire loan amount will likely have to be paid back within 90 days. Five, if you cannot pay the entire amount back and you are younger than 59½, the IRS will characterize the unsettled portion of the loan as a premature distribution from a qualified retirement plan – fully taxable income subject to early withdrawal penalties.2

Do you assume that your peak earning years are straight ahead? Conventional wisdom says that your yearly earnings reach a peak sometime in your mid-fifties or late fifties, but this is not always the case. Those who work in physically rigorous occupations may see their earnings plateau after age 50 – or even age 40. In addition, some industries are shrinking and offer middle-aged workers much less job security than other career fields.

Is your emergency fund now too small? It should be growing gradually to suit your household, and your household may need much greater cash reserves today in a crisis than it once did. If you have no real emergency fund, do what you can now to build one so you don’t have to turn to some predatory lender for expensive money.

Insurance could also give your household some financial stability in an emergency. Disability insurance can help you out if you find yourself unable to work. Life insurance – all the way from a simple final expense policy to a permanent policy that builds cash value – offers another form of financial support in trying times.

Watch out for these mid-life money errors & assumptions. Some are all too casually made. A review of your investment and retirement savings effort may help you recognize or steer clear of them.

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Citations.
1 – nerdwallet.com/blog/credit-card-data/average-credit-card-debt-household/ [6/25/15]
2 – tinyurl.com/oalk4fx [9/14/14]

Behind on Your Retirement Savings?

July 23rd, 2015 | No Comments | Posted in Financial News

What steps could you take to catch up?

shutterstock_221546422If life has not allowed you to build substantial retirement savings, what can you do to improve your retirement prospects? Here are some suggestions.

Play catch-up. If at all possible, take advantage of the catch-up contributions the IRS allows you to make to IRAs and other retirement accounts starting in the year in which you turn 50. For example, this year a worker age 50 or older can put $24,000 into a 401(k) account compared with $18,000 for someone younger.1

Get the match. If your employer matches your retirement plan contributions to some degree when you contribute to a workplace retirement plan at a certain level, you should make every effort to get the match and take advantage of what amounts to an offer of free money.

Work a little longer. More years contributing to retirement accounts means additional inflows into those accounts, and additional growth and compounding for those assets. It means you claim Social Security later, resulting in a larger monthly benefit. It also leaves you with fewer years of retirement that you must fund.

Alternately, think about working a little early in retirement. It is true, your Social Security benefits could be docked as a result – but the tradeoff might be worthwhile.

If you are a Social Security recipient and younger than full retirement age in 2015, Social Security will withhold $1 in benefits for every $2 you earn over $15,720. This is called the Social Security earnings test. Social Security essentially balances this penalty out, however, by boosting your benefit as you reach full retirement age – and for that matter, you can earn as much as you want at full retirement age or later with no reduction to your benefits.2

If you retire at 62 and make $25,000 a year through a part-time job you hold during the first five years of your retirement, you are putting a dent in any Social Security income you receive until age 67 – but that $25,000 yearly income can represent $25,000 you do not have to withdraw annually from your retirement savings. You could also invest some of that income, and the annual yield on your investment could exceed annual consumer inflation. Not a bad move in many eyes.

Think about long-run growth investing. One of the biggest risks retirees face is the erosion of purchasing power. Some seniors invest in such a risk-averse way that they lose ground versus even minor inflation. Keeping a foot (or both feet) in the market may be essential if your retirement nest egg is small – not just because it needs to grow, but because it will need to grow faster than inflation.

Whittle down your debt. As Ben Franklin wrote in the 1758 edition of Poor Richard’s Almanac, “A penny saved is a penny got” (he never actually said “a penny saved is a penny earned”). While you may be thinking “mortgage,” reducing your credit card debt can produce the savings you want now. So can eliminating certain household expenses. Speaking of family expenses…3

Tell your adult children that you will not be supporting them. If you desperately need to catch up on your retirement savings effort, the last thing you want to do is provide your kids with a financial lifeline. You have 15 years or less until retirement; they may have 40 or 45. Helping them pay off their college loans may feel like the right thing to do for them, but it is not the right thing to do on behalf of your retirement.

Take one crucial step before you pursue any of these options. Turn to a financial professional to see what kind of retirement income you may need to live comfortably. (Any such consultation should include a Social Security analysis.) When you retire, having adequate income becomes just as important as having adequate savings.

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Citations.
1 – money.usnews.com/money/retirement/articles/2014/12/01/how-to-max-out-your-retirement-accounts-in-2015 [12/1/14]
2 – ssa.gov/retire2/whileworking2.htm [7/2/15]
3 – forbes.com/sites/realspin/2014/08/18/a-penny-saved-was-never-a-penny-earned/ [8/18/14]

The Importance of Life Insurance Audit

July 23rd, 2015 | No Comments | Posted in Financial News

Is it time to review your policy?

shutterstock_223155742Life insurance is hard. It’s hard to know if you have the right kind. It’s hard to know if you have enough. And it’s hard to know if you need any at all.

The insurance companies have made it even harder by coming up with bewildering names: whole life, term life, universal life. Some life insurance policies have a cash value while others do not. Some invest that cash value in the stock market while others pay a fixed rate of interest. Some insurance policies combine all of these ideas.

A recent study by life insurance advocacy group LIMRA discovered that most Americans thought a 20-year $250,000 level term life policy for a healthy 30-year-old costs about $400 a year. In reality, annual premiums for such a policy typically run about $150. No wonder, as LIMRA noted, that 83% of consumers forego buying life insurance. I see this misperception all the time. In addition, some people are paying for insurance that is not right for them.1

This is why it is important for you to sit down annually with an insurance professional to review how your policy works and how it will help you to protect your family.

When you’re young, a certain type of policy is needed. As you raise a family and take on more responsibilities, your needs change again. At some point – when the nest is empty or other life changes occur – there may come a time where you don’t need life insurance at all or you may desperately need it to protect your estate. Reviewing your life insurance policies is one way to make sure you have the coverage that is right for you and your family now, today – not when you bought it.

When is the last time you thought about your life insurance? Is it time to take another look?

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Citations.
1 – lifehealthpro.com/2013/08/30/the-shocking-statistics-behind-the-life-insurance [8/30/13]

July 2015 Monthly Economic Update

July 22nd, 2015 | No Comments | Posted in Monthly Economic Update

July2015_MonthlyEconomicUpdate

The New Generation of ‘Genuinely Creepy’ Electronic Devices

July 22nd, 2015 | No Comments | Posted in Lifestyle

The Nest Learning Thermostat is on display following a news conference Wednesday, June 17, 2015, in San Francisco. Google's Nest Labs is releasing new versions of its surveillance video camera and talking smoke detector as part of its attempt to turn homes into yet another thing that can be controlled and tracked over the Internet. (AP Photo/Eric Risberg)

Surprise! All those electronic devices you adore and rely on so much, like your TV and XBox can be just as much a security threat as a hacker who reads all your emails.

The Electronic Privacy Information Center (EPIC) sent a letter last week to the Federal Trade Commission and the Justice Department asking regulators to look into “always on” technology. The group cited technology from Microsoft, Amazon, Google and others as worrisome.

EPIC fears the average consumer isn’t aware that some of these devices are actually spying on them by recording their conversations even when the device seems to be turned off. The privacy implications of these devices, which they believe infringe on individual rights, is profound.

The companies say the devices are only engaged in “conversation” when triggered by a “hotword” or a certain gesture. However, those designs can’t be counted on to always work as planned and could cause accidental recordings.

If you’re worried about your privacy, here’s a list from EPIC that can help you audit your chances of staying anonymous.

The browser is reportedly able to remotely install code that allows the software to listen to users without their knowledge. The code was originally designed to support Chrome’s new “OK, Google” hotword detection, which activates a computer response when you talk to it. However, some users claim the code was installed and activated on their computers without them giving their permission.

Google responded to these complaints on its Chromium developer boards. “While we do download the hotword module on startup, we do not activate it unless you opt in to hotwording,” the company wrote. Some developers question this claim.

Samsung SmartTV

The Samsung SmartTV has a built-in microphone that is equipped with voice recognition technology that allows users to give verbal commands to the TV. In order for Samsung to convert your speech to text, the voice commands are sent over the Internet to a third-party for interpretation.

However, since the TV is “always on,” the microphone is recording every word you’re saying at all times. Even in its SmartTV privacy policy, Samsung acknowledges that all spoken words, including personal or other sensitive information, are sent unencrypted to the third party.

Nest Cam

Eavesdropping concerns in Samsung smart TVsThis Internet-streaming home security camera is a product of Nest Labs, which is now owned by Google. The camera comes with a microphone and streams video and sound directly to a consumer’s smart phone in real time. With the Nest “Aware” app, Google can record and save up to 30 days of video and audio.

Using the recording, the camera has the ability to alert users when an “unusual sound” is detected. Nest has the capability of distinguishing between unknown or known voices, which is an important security feature. But privacy advocates are fearful because the company does not disclose how the technology works or how much information the company collects.

Canary Connect

Canary Connect is another company that develops Internet-connected home security systems. The security device can store audio and video recordings from inside a user’s home for 90 days and can be set to one of three modes — “armed,” “disarmed” and “privacy.” Unless the device is in “privacy” mode, it will automatically begin to record when triggered by motion.

Users have complained that there isn’t an easy way to determine what mode the device is in. In addition, the interface doesn’t notify consumers when it is switching modes.

Microsoft’s Kinect

Microsoft has installed its “always on” voice and motion recorder, called Kinect, in its Xbox videogame consoles. When users say the word “Xbox,” the Kinect tracks and records the users’ voice and hand gestures in order to follow commands. In order for the device to know when to turn on, the console monitors conversations at all times.

Amazon Echo

Amazon Echo, like other voice-activated computer programs, is triggered awake by the word “Alexa.” The device is constantly listening in on household conversations for the word, which then triggers the system to record and stream the recording to Amazon’s cloud for processing and storage. Amazon has not revealed what data the system collects and if it saves conversations or words said before “Alexa.” In addition, various companies are in the process of incorporating Alexa into their Internet-connected devices. Amazon has not revealed how much information it will have access to once these other companies begin to collect their own data.

Mattel’s “Hello Barbie”

A new high-tech Barbie has sparked a furious outcry from the advocacy group Campaign for a Commercial-Free Childhood. Through a Wi-Fi connection and a built-in microphone, the new Barbie is able to hold conversations with a child. Critics, in addition to the privacy concerns, are worried that Mattel is exploiting the children and using them for financial gain because they can learn the child’s likes and dislikes. Mattel counters that there are safety precautions put in place and that the toy fills a niche for children who want to be able to speak with their Barbie.

Source: finance.yahoo.com

Google Just Took Another Small Step Toward Replacing Your Brain

July 22nd, 2015 | No Comments | Posted in Lifestyle

We’ve known for years that search engines like Google change how humans remember information — so what happens when we use online services to keep track of where we’ve been in life?

Google on Tuesday announced a new update to its Maps program which will allow people to visualize all of the places they’ve visited, so long as they were carrying smartphones at the time. It’s called “Your Timeline,” and it’s currently rolling out for Android devices and desktop browsers, meaning users should be able to access it over the next couple of days if they can’t already. A spokeswoman for Google told The Huffington Post that there are “no specific plans” for iOS.

Your Timeline displays the route you took to a given location, provided you had your location services turned on, as well as any pics you snapped that day, if you’re a Google Photos user. You can also look through your history to see where you were on a given day, month or year.

For example, say you’ve taken a June vacation to New York City. You’re staying at a Marriott in Manhattan. You wake up at 7 a.m., walk to a nearby Starbucks, happen to run into Susan Sarandon on the street, snap a selfie with her, take the subway to the Museum of Natural History, grab a burger at McDonald’s nearby (you can do better, but you’re starving) and taxi back to the hotel for a nap. If you’ve opted into the Your Timeline feature, you could, in theory, revisit that day years down the line, see exactly where you went, look at your smiling mug next to Sarandon’s and regret once more that you didn’t try a more adventurous lunch spot.

The feature is entirely opt-in right now, meaning you don’t have to use it, and Google says it’s “private and visible only to you.” If you want, you can delete certain days — maybe you have a bad break-up — or your entire history.

That last part might raise an interesting question. Remember “Eternal Sunshine of the Spotless Mind,” the Michel Gondry flick where Jim Carrey and Kate Winslet get a weird sci-fi procedure to forget their relationship ever happened?


Memories disappear in “Eternal Sunshine of the Spotless Mind.” (Source)

Well, deleting a “day” from your Google timeline isn’t the same as scrubbing your brain, of course, but consider how our gadgets have already started to meld with our brains in weird ways. As Clive Thompson explored in his book Smarter Than You Think, our phones, with their easy access to search engines, have already become a kind of memory partner for us. Much the same as you’d ask your human partner about the name of “that movie we saw a few months ago,” you “ask” your phone to quickly find information for you.

Research has shown that relying on search engines for information leads us to remember fewer facts for ourselves. In practice, that might mean that you no longer bother to memorize state capitals or how many cups are in a quart, but it begs the question: What happens when we rely on much the same technology from Google to track where we’ve been in our own lives via location data and automatically tagged photographs?

Of course, any freakouts about this particular software may not be totally warranted: iOS has offered similar, if shallower, tracking functionality for years, and many of us already manually catalogue our lives on the likes of Facebook, Twitter and Instagram.

Still, it’s an interesting look at what our increasingly connected future may hold.

Source: huffingtonpost.com

Why Foreign Retirees are Flocking to Mexico

July 22nd, 2015 | No Comments | Posted in Lifestyle

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