Archives for 2011

New Year’s Resolution: Giving More

This time of year, we think a lot about New Year's resolutions, and what we can do to improve ourselves — and our lives. While these resolutions can be helpful in improving your financial situation and your lifestyle, you might be surprised at what you can accomplish in your own life if your resolutions focus on someone else.

Giving can be a great way to help others, while at the same time improving your outlook on life. As you contemplate the way you want your life to look over the course of the next year, consider making a resolution to give more:

Goal of Giving More

Money

The easiest way to give more is to donate money to a cause or a charitable organization. Look around your community and see if you can find worthy recipient of your money. In some cases, it might be as simple as increasing your regular donation to your religious congregation, or upping your donations to the local food bank. In any cases, being generous with your money helps your own finances in a couple of ways:

Increased contentment: One of the interesting effects of giving money away to good causes, or even to help loved ones, is that you tend to look at what you have in a new light. When you help the less fortunate, you are reminded of what you already have — and it can help you feel more contentment with your situation. The more content you are with what you already have, the less you feel the “need” to buy more stuff to augment your situation.
Better money management: A regular policy of giving forces you to better manage your money. If charitable giving is a financial priority, then you have to properly manage your finances so that you can meet your regular obligations while meeting your goal of giving.

And, even though many people don't give with the tax deduction in mind, it's still a consideration. You can reduce your tax liability through charitable giving.

Stuff

You don't always have to give money, though. Some of us just don't have the resources we'd like to write big checks to our favorite charities. Instead, you can consider giving some of your stuff away. Look for friends and family who might need the stuff, or give it to charity. Chances are that you have a few things, in good shape, just sitting around, not fulfilling any purpose. Give it away, and someone else could get good use out of it, and, on top of it, if you get a receipt from a charity, it can also count as a tax deduction.

Time

Many charities just need your help. Make a resolution to volunteer more often. Go once a month, or every two months, or whatever you have time for. Helping others can provide you with a healthy mental state, and it can also give you something worthwhile to do. Your time is a valuable commodity, true, but you might find that you are making a good investment by volunteering your time, expertise or talents to those who could benefit.

What are your New Year's resolutions? Are you planning to give more in the coming year?

Why NOW Is The Best Time To Start Saving For Retirement

By Miranda Marquit 4 Comments

Actually, years ago was the best time to start saving for retirement. As soon as you started earning income was the best time to save for retirement. But now is the second best time to start saving for retirement.

Don't wait until you have “enough” money to start a retirement account. Many brokerages offer you the ability to start saving for retirement with a rather low account minimum. You can pretty much start saving for retirement with any amount of money.

Start Saving Now

Get In The Habit

One of the best reasons to start saving for retirement now ist that you get in the habit. Even if you can only contribute a few dollars a week to a retirement plan, the fact of the matter is that you are developing the habit of setting aside that money.

Besides, you might be surprised at how much money you can “find” to set aside for retirement if you look around a bit. You can increase your income through creative means, or you can reclaim wasted money by cutting back on expenses. In either case, the result is to look for money that can be put toward the future.

However, you don't want to remain complacent about the amount of money you contribute to your retirement account. As your income increases, so, too, does the amount you should be able to put into your account. Periodically evaluate your retirement account contributions and make changes to the amount. But the idea is to start as early as you can, so that you develop the habit of setting money aside for retirement. The practice of thinking ahead with your money is a vital one to be in if you want to create a successful financial plan and achieve financial freedom.

Dollar Cost Averaging

When you start now, and put a regular amount aside as a retirement contribution, you are taking advantage of dollar cost averaging. This is a great way to affordable build up your retirement account, while getting the habit of saving. The idea behind dollar cost averaging is that you use the same amount of money each month to buy however many shares of an investment that you can.

In times when the market is down, your retirement contribution dollar goes further, purchasing more shares for less. (Of course, when the market is higher, you get fewer shares for your money.) This means that it actually isn't a bad idea to build your portfolio during times when the market is struggling. You'll be able to buy more shares, and later, as the market moves higher, those extra shares will be worth even more.

Put Compound Interest To Work For You

Another reason to start now is that you have more time for compound interest to work on your behalf. The sooner you start investing, the more time the interest you are paid has time to earn interest of its own. There are numerous studies and articles written about how starting just five or 10 years earlier can make a huge difference in the amount of money you ultimately end up with. Get started now, and your money will have more time to work on your behalf, resulting in a larger nest egg by the end.

How To Choose Good Tenants For Your Rental Property

By Miranda Marquit 8 Comments

I‘m pretty sure I'm not cut out to be a landlord. However, I have watched friends and relatives do the landlord thing. I know that, if you are the right sort of person to be a landlord, it can be profitable. You could easily fund your retirement with the income from your tenants.

On the other hand, though, if you aren't careful, you could end up in a nightmare. The wrong tenants might ruin the house, or be late paying. You could end spending far more than you are bringing in, just to make repairs and try to collect rent (or end up losing your money altogether). After watching the saga play out with my in-laws, and after what happened across the street from me, here is what I would do if I were choosing tenants:

how to choose tenants

NEVER Rent To Friends Or Relatives

As with so many things in life, trying to make something business-related work with friends or family can backfire on you. Friends and relatives might assume that you will give them a break — even if you do sign a lease (and you should always sign a lease), and do everything by the business book. In the end, friends and family expect your personal relationship to come first, and the business relationship to come second. If you try and stick to the business relationship on rent-related matters, your personal relationship can easily become strained.

Credit Check

Before agreeing to let someone move in, you should run a credit check. Find out what sort of credit the tenant has. Check references. Don't be afraid to ask for the name and phone number of a prospective tenant's boss. Even if you don't run a credit check, you can ask for proof of income, and proof of employment. Pay stubs or bank statements (tell the tenant to black out the account number) can serve to help you verify income.

As part of this process, ask for a previous landlord's information. Our friends rented out their house, across the street from us, and even though the tenants were evicted from their last home, they still allowed them to move in. Needless to say, after more than a year of frustration, our friends finally evicted these tenants — and performed extensive repairs on the house. Talk to the previous landlord, and find out what kind of tenants they were.

Get Money Up Front

You don't want to start your landlord-tenant relationship out with your renters owing you money. Find out if they can give you the first month's rent plus security deposit up front. For the most part, responsible tenants are also responsible with their money, and build this type of payment into their plans. Establish,

When all else fails, trust your gut. If you have a bad feeling about a potential tenant, don't go through with the transaction. Look for someone else. Interview potential clients so that you know what to expect, and look them in the eye. While you can be fooled by some people, your gut can be very valuable as you decide which tenants to accept. Remember: As long as you follow the law, you can be picky about the people who live in your rental.

What are your tips for choosing tenants?

Saving Money On Video Games For A More Frugal Gaming Experience

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If you are at all connected to the Internet, you understand that gaming has become a vital part of our economy. Top manufacturers like EA, THQ, and Rock Star have cemented themselves in the gaming industry and procured licenses that generate a ton of revenue for clients such as the NFL, MLB, and WWE. In order to make money off of their expensive licenses, however, they have to start charging consumers more money to play the games.

What if there were ways to save money on your gaming needs instead of constantly racking up credit card bills and feeling like a consummate consumer every day? Consumers often fall into hidden traps and holes when it comes to their video game dollars. Here are some ways you can get the most entertainment out of your video game budget without raising your checking account rates:

Saving Money On Video Games

Buy Used Titles

If you are just getting into video games, you may be shocked that the latest titles can run you in excess of $60 a pop. In order to avoid paying these premium prices, you can visit a variety of retailers to purchase the latest titles for less money because they have been opened already. Stores like Best Buy, Gamespot, Amazon and others will sell used games at a lower price. Buy used instead!

GameFly

The worst feeling in the world is purchasing a new video game only for it to be awful. Spending any kind of money and then receiving a lackluster game can make the most die-hard gamer feel a little used. Instead of purchasing games as they come out, sign up for Gamefly. By subscribing to the service you can receive games in the mail for as little as $7.95 a month. Other services like Redbox kiosks will also allow you to rent a game at a fraction of the cost. Rent instead!

Download Emulators

One of the best eras in gaming is the original NES and Sega Genesis days. Games were simple and easy to figure out, which provided a lot of fun for everyone. Today if you want to play Super Mario or Sonic the Hedgehog, you are going to have to get a Wii or spend a bunch of money on eBay where the consoles have become collector's items. By downloading Roms and emulators you can play these classic games for free on your own computer. Play free classic games instead!

Stay Out of the Controversy

According to the Cato Institute, the government has been trying to legislate video games for the longest time, they feel like they have a right to tell parents and families what is best for their kid's safety when it comes to video games. According to many, however, video games haven't been shown to have any link towards violent or abberant behavior – in some cases the opposite is true.

No matter what political stance you take on this issue, more controversial games are going to have higher prices because of their high profile and because of supply and demand. Try playing some less controversial games!

Buy for Education!

If you think video games are a waste of time, you may not be completely on target. The United States Military uses simulations from the leading game manufacturers in order to train soldiers and prepare them for real combat operations.

Think interactive video games are a waste of time or more suited for children? Think again. Research under way by the Office of Naval Research indicates that video games can help adults process information much faster and improve their fundamental abilities to reason and solve problems in novel contexts.

By purchasing titles for your children, you are making an investment in their education! Just think about all of the problem solving capabilities they will develop from playing complicated games.

While gaming is not for everyone, the popularity of gaming is continuing to grow with the biggest game titles making more money than Hollywood blockbuster movies! Games are leaving their mark on the overall economy.

Major gaming companies will continue to charge so much for their products simply because people are buying them. In order to save money on your games, shop smarter and do your research before committing to anything.

Have your own tricks for saving on video games? Tell us in the comments.

Paying For Your Child’s College Tuition

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It should come as little surprise that college tuition costs are incredibly high and that, over the past couple decades, they have risen far faster than the rate of inflation. For the average family – and even for the more economically-secure one – paying for college is a tremendous and considerable investment, one that cannot be adequately done without years of planning and foresight. According to estimations, the cost of raising a child from the age of birth to 18 can be doubled in some cases when college costs are included.

Faced with these costs, most families choose not to pay for their child’s post-secondary education, instead working to provide assistance and support as their son or daughter amasses student debt and then works to pay off their loans. For many families this approach is the far more practical and feasible one. Others, however, take a stop-gap approach to college costs, meaning that they don’t plan adequately and must resort to selling the family jewels and amethyst rings to cover tuition when the time arrives.

College Costs

If you have college-bound kids, and if you are planning to be the primary contributor to their tuition costs, there are practical means for saving money towards college and for reducing the bill. Here, then, are some tips that every parent in this situation should keep in mind:

Start Saving At Birth

On a long-term basis, planning for college should be similar to saving for retirement. On that note, you’re going to want to have a college savings fund for your child into which you put regular contributions. This fund should be opened at birth and closely watched and maintained, just as you would a retirement account. Furthermore, by putting the money into an account specifically set aside for college, you can avoid paying taxes on much of the money and realize higher rates of interest.

Share The Responsibility With Your Child

Even if you plan to pay the majority of college costs, your child should still contribute towards the effort. During high school, perhaps, the money earned from your kid’s summer jobs could go into the fund. Once they arrive at college, you may want to have them explore a work study program that helps reduce their tuition. The actually approach is one that you should determine as a parent and discuss as a family, but the bottom line is that it’s important for your child to be involved in the process – and to contribute towards it.

Pick Cost-Cutting Payment Plans

Most colleges and universities offer several different payment plans for tuition, and most of these include plans where your overall costs are lower if you pre-pay for each semester in installments. There is no reason not to do such a plan; after all, if you have the ability to pay for your child’s college education, you have nothing to gain from postponing the payments and taking on debt.

Get The Tax Rebates

The federal government offers rebates and other tax incentives for costs relating to a college education. While these sometimes vary from year to year, the vast cost of college means that the tax savings can be considerable.

There are certainly other methods and tricks for saving for college and for reducing the costs once your child has enrolled. But the ones listed above should be some of the most helpful and important ones to use if you’re a parent. Saving and paying for college is a mammoth undertaking, so it’s always best to be prepared.

Gift Cards: Watch Out For Scams

By Miranda Marquit 1 Comment

One of the best gifts you can give to others is the gift card. I'm a big fan of gift cards. Unfortunately, no matter what you are buying, or where you are buying it, it always seems as though there's some scammer out there trying to take advantage — and the same is true when it comes to gift cards.

There are gift card scams out there, and you need to be ready. Be careful this holiday season, and carefully scrutinize your gift cards ahead of time.

Discounted Gift Cards

One of the most obvious places you need to look for scams is with discounted gift cards. I love discounted gift cards. They can make great gifts — and you can get more for your gift-giving buck. However, not every purveyor of discounted gift cards is honest. Major sites, like City Deals, Groupon and Living Social can provide you with legitimate gift cards at discounted prices.

gift card scams Where you need to be careful is on gift card exchange web sites. In some cases, the gift card exchange site is simply a marketplace. The site that facilitates that transaction doesn't guarantee the gift card. That means that you could pay money for a gift card, and then not receive it. Or, perhaps, the seller has an expired gift card. You pay for the card, and when it arrives, it's useless. When shopping gift card exchanges, it's important to check the conditions of the site. Find out whether the site guarantees the gift cards sold on the site, and what recourse you have if things aren't as they are represented.

Buying Gift Cards in the Store

Some scammers are really smart about their gift card perfidy. Golden Gate BBB warns that some scammers actually go into stores and write down gift card numbers — and PINs. It's then possible to wait until the cards are activated. There are web sites that offer information about gift card balances. Scammers just have to check regularly to see when the cards are activated, and then go on an online spending spree with your gift card.

Before you purchase a gift card, Golden Gate BBB recommends that you check to make sure the package hasn't been tampered with, and that the PIN is still covered — not scratched off. It is also recommended that you avoid grabbing the first gift card you see prominently displayed; ask for the cards stored elsewhere, since they haven't been available to the public and there is less chance that they have been tampered with.

Bottom Line

Increasingly, you have to be careful about how you go about buying your gift cards. As technology and convenience grows, so, too, does the ingenuity of scammers. You need to be on top of things, and be vigilant, even when purchasing gift cards from a store. With a little caution, though, you should be able to find gift cards that are safe to give, and that might even be discounted to a point that saves you money on your Christmas shopping.

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