America Saves Week: Pledge to Save

Posted in Saving on

america-saves-weekAmericans aren’t known for being great savers. However, there are signs we’re making progress and catching up.

What are other countries doing?

Some countries like Germany are known for their frugal ways. According to this Market Place story Germans even have a National Savings Day where kids are rewarded for depositing their savings to the bank. As a society they didn’t have a positive experience with debt and that has translated to their personal finances too.

Other countries have encouraged savings successfully. According to this article by Sheldon Garon, the author of Beyond Our Means: Why America Spends While the World Saves, in Europe, consumer credit (credit cards and home equity lines of credit) aren’t as widely available as here in the US. Additionally, predatory lending is more highly regulated in Europe.

Personal Finance Battle: NHL vs. NFL

Posted in Budgeting & Planning, Saving on

At the start of the National Football League season I wrote a post titled Why Are So Many NFL Players Broke As a Joke? It touched on the financial ruin many pro-football players face shortly after retiring.  I didn’t want to pick on just one sport so now that the National Hockey League season is FINALLY starting (go Sharks!) I thought I’d see what we can learn about personal finance from hockey. 

How to Read an Account Statement

Posted in Miscellaneous on

We are often bombarded with account-related mail and paperwork. Even if you opt for e-delivery, it isn’t always clear what information is being delivered. It can feel overwhelming when it’s unclear what these documents mean and how we should handle them. Today, we’ll examine an account statement (this could be a brokerage account or 401(k) etc.) and highlight the pertinent information you should look for.

Review: Nerdwallet’s New Account Comparison Tool

Posted in Budgeting & Planning on

Nerdwallet describes themselves as “the first ‘.org’ personal finance search site.” They handpick rewards programs and deposit accounts to help users find thebest financial products. At the end of March, they launched a checking account comparison tool that searches through 125 checking accounts to find low-interest accounts based on a set of personalized criteria.

I took a thorough look at this tool and would like to share some of my thoughts. 

Spring Cleaning: Personal Finance Edition

Posted in Budgeting & Planning, Financial Adjustment, Financial Protection, Investing & Stocks, Retirement, Seasonal & Holidays, Taxes on

As you vacuum behind sofas and clear clutter from the garage, I want to offer some Spring cleaning tips that focus on your finances. I’ll touch on what documents you need to keep and what documents you can shred. I’ll also offer a tip or two for staying organized with all the paper in your life.

Below I’ve summarized a list of necessary documents with the help of BankRate. You’ll want to set up an archival system so that these documents are all in one place. Think of organizing them so that someone who had never seen this “drawer” before could understand it.

Tax Preparation Checklist

Posted in Taxes on

Before you begin to prepare your income tax return, go through the following checklist. Not every category will apply to you, so just pick those that do, and make sure you have that information available. When you’re ready to prepare your tax return using TurboTax software, you’ll be surprised at how much time you’ll save by organizing your information beforehand.

A Guide to Commonly-Used IRS Tax Forms

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This primer will help you decode the alphabet soup of IRS forms – and understand your tax return.

There are more than a thousand IRS tax forms for reporting various kinds of income, expenses and other financial data—and each piece of paperwork bears its own letter or number, which can seem as foreign as a new language. Fortunately, learning just a few key tax forms can give you much of the information you need to understand your tax return. Here’s a primer on some of the documents you’ll want to be familiar with as you use TurboTax to prepare your tax return.

Book Review: The Richest Man in Babylon

Posted in Budgeting & Planning, Financial Protection, Investing & Stocks on

The Richest Man in Babylon, by George S. Clason, is a personal financial classic and a book that I have enjoyed. It was written in 1926 and has a poetic style, telling stories with financial concepts in the form of parables. These stories not only discuss our relationship with money but also a broader life philosophy. It’s concept oriented and meant to stand the test of time without using financial jargon. The book illustrates the purpose and meaning that we can create in our life by using money wisely. We often get caught up in the details of a certain investment or account type but this book takes a step back and addresses fundamental wealth creation principles to live a happier, more prosperous life in the long-hall.

In one of the books, Arkad (the richest man) outlines the “Seven Cures for a Lean Purse” to the citizens of Babylon so that they may also have his financial success.  Here are seven “simple truths” that will help you on your journey.

How to Live Cashless: Tools That Make Cash Obsolete

Posted in Spending (Spend Less) on

America is moving in the direction of a cashless society. Mobile payments are on the rise and pre-paid credit cards are becoming a viable solution to those who don’t want to use traditional credit cards.

Let’s face it – cash is dirty, a nuisance to keep track of, and not readily obtainable (where is the nearest ATM?!). Sure, cash has historically proven to be the most effective,efficient way to pay; it has always been easier to split a check at a restaurant, merchants aren’t slammed with transaction fees, and it’s well… an American symbol. In the past couple of years, a number of brilliant tools have emerged to push America closer toward a cashless society. I want to introduce you to a tool that could change the way you spend and the ease of managing your finances. I’ve already written a post commenting on the beauty of Square, the payments startup that is making waves around the country, allowing merchants to accept credit cards through their iPhones or iPads with more reasonable merchant transaction fees. Square is a wonderful thing and it is growing like a wildfire, however, it isn’t quite meant for peer-to-peer transactions, which is what I want to talk to you about today.

The Difference Among Financial Accounts: A Comparison of After-Tax, IRA and Roth IRA Accounts (Part III)

Posted in Retirement, Taxes on

This is the final post in a three part series comparing the taxation of different types of accounts. Last week, I analyzed the differences between an IRA and a Roth IRA. This week, we’ll look at an after-tax account in more detail.

You might recall from the first post that an after-tax account is taxed as follows: with checking, savings or brokerage accounts, funds are taxed (generally as ordinary income) before they are deposited. When there is a sale at a profit, that growth is also taxed (normally at capital gains rates). For example, when you sell a mutual fund for a gain, that gain will be taxed. When funds are withdrawn from an after-tax account there is no taxation.