Let us create a 3d Digital eBook for you! DigyCat.com
Before You Start Investing
There maybe several reasons why you to want to invest your money. You may want to retire early, want to build your own business in the future, or to pay for your kid's education. Should everyone start investing outside their retirement accounts right away? The answer to this question is that it depends on your financial situation. First, you must have a basic understanding in financial management. What would happen if you lose your job, accumulate large medical expenses, or losing money on your investments? Do you still have money to pay your bills? Do you have to sell your investments that you have worked so hard for, with a loss? No one knows what the future will bring. Therefore, you must have a safety net to fall back on in an unexpected event. This article contains 5 concepts that you should follow before you start investing outside of your retirement accounts.
1. Increase your savings rate:
Cutting down on your expenses is the easiest way to increase your savings rate. You can also increase your savings rate by working overtime or switching to a higher paid job, but these are usually harder to do. If you want to accomplish your financial goals, you must start saving your money. You can do this by evaluating where you spend most of your money, and adjust your lifestyle to increase your savings rate. You will be surprised how small changes can increase your savings rate tremendously. For example, you can make your own coffee in the morning, shop while the clothes are on sale, and cut down on eating out, can save you lots of money.
2. Emergency cash reserve:
Have an emergency cash reserve of at least 3 to 6 months of living expenses. This step maybe the hardest step to accomplish. But in the event that you lose your job, you will be thankful that you have this money. The best place to put your emergency cash reserve is in a money market fund. If you have relatives that are generous, you could use them as your emergency cash reserve. But make sure that you ask them first.
3. Paying off your consumer debts:
Pay off your consumer debts, such as car loans and credit card loans can help you financially. Let's say that your credit card charges you a 10% annual interest rate. Paying down that loan is like investing your money in stocks with a 10% annual return without tax consequences and risk free. Another reason you may want to pay off your consumer debts is that the interests are not tax detectible.
4. Paying down your mortgage:
If you want to pay down your mortgage earlier than required, compare your mortgage interest rate to an investment that you intend to invest in to make your decision. However, all investments have risks and you could end up losing money if you chose to invest. I personally think that paying down the mortgage early is too boring. In addition, the interests that you pay are tax deductible. Another reason that you may not want to pay down your mortgage early may be that you want to contribute more to your retirement accounts.
5. Contribute to your retirement accounts:
Take advantage of the tax benefits of your retirement accounts. If you are in a 30% tax bracket, for every $1000 that you contribute to your retirement account, you instantly saved $300. In addition, any profits inside your retirement accounts (dividends, interest) grow without taxation until you withdraw your money after age 59˝. If your company matches a certain percent of your pay, you should contribute at least enough to receive the maximum company match. After all, it is free money. This is similar to making 100% return on your investment immediately. Can you do that with stocks? Not likely!
Once you have developed your safety net, you are ready to take on more challenges, but do it wisely. It took me 2 years to have my finance organized to begin investing outside of my retirement accounts. Use as much time as you need. And remember to diversify your portfolio.
Investing - Google News
This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news
Success Trading: More Basic Terminology for New Traders
One important aspect of trading the markets is to understand how to feel it's overall pulse. In the stock market, this is measured by measuring the movements of selected stocks across various sectors to let us know how the market is doing in general.
Annuity Investment - The Whole Truth
Do you ever feel like you haven't been told the whole truth? Kind of like something is missing? Well, you are not alone.With many investors awestruck over the last several years by the declining stock markets, many feel like they're out in the cold.
Asset Allocation: Critical to Your Investment Success
Asset allocation is a critical component of investing success. Both research and academic studies show asset allocation to be single most significant factor in determining your financial goals.
Investing in Car Dealerships: How to Do It Right
The financial characteristics of the automobile dealership are attractive:". .
The Light Crude Continuous Contract closed at $66.13 a barrel Friday, after hitting an all-time high at $67.
Going Offshore For Asset Protection
There are a number of key reasons why individuals and businesses consider going offshore for asset protection purposes.The asset protection advantages the offshore world offers extend from protecting a business from excessive taxation to opening doors to enable wealth and asset enrichment via the utilisation of offshore investment opportunities.
Profitability And Stock Turn Rate
The inventory of the typical store represents the largest single element of its total assets. The sale of goods from this inventory is the merchant's chief source of operating profit.
The Arrow-Debreu Contingent Claims Model of Investment
Throughout the discussion of speculation and stability, we emphasized that uncertainty theorists now have a generally accepted framework for modeling choice under uncertainty. Economic theorists have chosen to model uncertainty as the revelation of a state of the world.
Finding a Broker
"Hey Joe! I need help finding a broker. I notice that discount commission rates are pretty much the same.
Finding the Perfect Company
The perfect company - it's the holy grail of the investment world. The company that will make its initial investment hundreds of times over.
Lessons in Transition
Q: What have been the most successful approaches to attracting direct foreign investments: offering prospective investors tax breaks and similar benefits, or improving the overall investment climate of the country?Empirical research has demonstrated that investors are not lured by tax breaks and monetary or fiscal investment incentives. They will take advantage of existing schemes (and ask for more, pitting one country against another).
Is a SEP Plan Right For Your Business
A SEP is a special type of IRA. Under a SEP plan the employer creates an IRA account for each eligible employee, hence the name SEP-IRA.
The American Age of Inflation is Over
"The American Age of Inflation is finished." So says economist Robert Samuelson in his December 2nd Washington Post column.
Investigate Before You Invest
"Through wisdom is a house built. And by understanding it is established.
Creating a Financial Future--Putting Your Plan Into Action Part 2
Real Estate can be a useful tool for investing. The simplest real estate investment is not truly an investment, but a cost-reduction - that is owning your own home.
Dont Catch a Falling Knife
One of the most common mistakes made by inexperienced investors is trying to "catch a falling knife". This is the phrase used to describe the habit of buying stocks that are in "freefall", and is a poor strategy, albeit common among new investors.
Use this Simple Trick its to Buy $100 Bills Direct from your Bank for only $97
Most People just don't understand the power of using their home as a Wealth Creation Tool. How many people do you know who have lived in the same house for 10, 15 or more years and have virtually no mortgage, You know the Type 'House Rich Cash Poor'.
Short Selling for Investors
Shorts. Let's see.
I've been in and interested in the stock market so long (one year shy of forty years) I can remember when the mutual fund pages in my home town paper were just one page! Now it looks like there are more mutual funds then there are stocks listed on the New York stock exchange.I wonder how many billions of investor dollars are supporting these funds.
Trend following also called momentum trading is the simplest and safest method of stock market investing. It puts you in stocks and mutual funds that are going up and gets you out when they start down.
MyIdeal Domain Is For Sale - $8,000 For Enquiries eMail Us
© www.MyIdeal.biz - 2012