About Financial Planning

Is It Time to Refinance Your Mortgage?

2009-11-06T13:06:30Z

Mortgage rates have fallen quite a bit this year, so a common question is whether or not you should consider refinancing. The benefits are easy to understand. The lower the interest rate, the lower your monthly payment and total cost of buying a home. But before you rush into a refinance, there are some drawbacks to consider.

For starters, it costs money to refinance. In some cases, it can cost thousands of dollars. So, while you may be lowering your monthly payment, how long will it take to break even on the closing costs? Six months? A year? Three years or more? If you aren't sure whether you'll be in the house long enough to offset the cost, a refinance could end up costing you more.

Refinancing your mortgage can be a great way to save money, but make sure you consider all of the pros and cons before signing any papers. It is an important decision, and if you aren't careful, it could prove costly.

Is It Time to Refinance Your Mortgage? originally appeared on About.com Financial Planning on Friday, November 6th, 2009 at 13:06:30.

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Top 5 Money Mistakes College Students Make

2009-11-03T20:25:51Z

College is an exciting time for young adults, but with this comes a lot of financial responsibility. Between college tuition, room and board, spending money, and trying to have a good time, money can be pretty tight. Unfortunately, many college students fall into a few major money traps that can follow them around for more than a decade.

Just a few poor decisions in college can hurt your prospect of getting a car, finding a mortgage, or even landing that dream job. So, instead of getting caught off guard college students should be aware of some of the major money mistakes and make an effort to stay out of trouble. If you do, you'll be well ahead of your peers after graduation. Here are the top five money mistakes college students make.

Top 5 Money Mistakes College Students Make originally appeared on About.com Financial Planning on Tuesday, November 3rd, 2009 at 20:25:51.

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Tying the Financial Knot

2009-11-01T19:09:38Z

Combining finances can be very helpful for a new couple, but it can also be very stressful. Money is one of the top issues that create arguments in a relationship. Everyone has different priorities and values pertaining to money, so it is easy to see why money can be a hot button issue when couples don't see eye to eye.

Plan Ahead

The good news is that you can alleviate most of the problems with some planning. This means taking the time to talk about financial issues before getting married if possible. While you may currently maintain separate accounts, realize that it is important to think about what you're going to do in terms of bank accounts, saving money, paying off debt, and getting insurance before you're overwhelmed with all of these important decisions after you've tied the knot.

Communication is Important

While planning out your financial road map is important, maintaining an open and honest line of communication with your spouse is vital. One of the most damaging things you can do in a marriage is to hide and lie about money issues. Eventually, the truth will surface, and it will create an incredibly stressful and possibly harmful situation. If you are bringing debt into the relationship, be open about it. If you place importance on saving for retirement above all else, let that be known. The more open you are regarding your values and money situation, the less likely a problem will arise out of nowhere.

Additional reading:

Tying the Financial Knot originally appeared on About.com Financial Planning on Sunday, November 1st, 2009 at 19:09:38.

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Take Advantage of Your Employer's Open Enrollment Period

2009-10-30T10:35:34Z

For many employers, fall is the typical open enrollment period. It usually last a few weeks to a month and it's when you get to decide which benefits you want to enroll in or opt out of as well as how much coverage you want to pay for. This is an important time of year if you rely on your employer's benefits because once you make an election it's typically set in stone for the entire year until the next open enrollment period. If you were to make a poor choice or forget to enroll in a benefit altogether you could find yourself in quite a financial bind later in the year. Here's what to look for and how to make the most of this year's open enrollment period.

Take Advantage of Your Employer's Open Enrollment Period originally appeared on About.com Financial Planning on Friday, October 30th, 2009 at 10:35:34.

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Tips to Save Money on The Upcoming Holiday Season

2009-10-27T20:51:19Z

The holidays are rapidly approaching, and for many people, that means shopping and traveling. While this can be a hectic and expensive time of year, you can actually find ways to help reduce spending and stress. One of the best things to do is simply avoid waiting until the last minute to take care of your shopping and holiday plans. Use the next few weeks to slowly begin picking up gifts and other holiday items before it gets terribly busy in the stores. In addition to starting early, there are plenty of other ways you can save money this year.

Save money this holiday season:

Tips to Save Money on The Upcoming Holiday Season originally appeared on About.com Financial Planning on Tuesday, October 27th, 2009 at 20:51:19.

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Saving Money the Easy Way - Make It Automatic

2009-10-25T19:57:10Z

Many people think saving money is hard, but it doesn't have to be. The biggest problem is that most people treat savings as something that should be done after all of the necessities are paid. This usually means that by the time you pay all your bills, buy groceries, gas, and everything else, it feels like you have nothing left to save. That is the opposite of what you want to do. Think of your savings goal as a bill or expense -- whether it is $25 a month or $250 a month -- think of it as a bill that needs to be paid first.

One of the best ways to do this is by setting up an automatic savings plan. It doesn't matter if it is through your bank, brokerage, or retirement account, but you should be saving a portion of your income automatically. If you have to physically go to the bank and make a deposit, how likely are you to accomplish that? On the other hand, if you have $50 deducted from your paycheck every two weeks and have that money go into a savings account, how likely are you to miss it? When you don't see it, you don't miss it.

The Importance of saving and how to create an automatic savings plan:

Saving Money the Easy Way - Make It Automatic originally appeared on About.com Financial Planning on Sunday, October 25th, 2009 at 19:57:10.

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Calculating Your Tax-Equivalent Yield

2009-10-23T12:51:12Z

When comparing interest rates on things like savings accounts, CDs, and bonds, it's a pretty simple process - the higher the interest rate, the higher the return. While that is simple enough, most of the time these types of investments are taxable. That means any interest you earn is taxed, which means your actual rate of return is lower than the interest rate.

But what about tax-exempt investments like municipal bonds? In cases like this, the interest that's generated may be exempt from federal, and in some cases, state income taxes. This means the interest you earn goes entirely into your pocket without having taxes eat away at the returns. Because of this difference, you can't simply compare interest rates between taxable and tax-exempt investments. Instead, you need to calculate your tax-equivalent yield to determine your real rate of return.

Calculating Your Tax-Equivalent Yield originally appeared on About.com Financial Planning on Friday, October 23rd, 2009 at 12:51:12.

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Are You Prepared for a Career Change?

2009-10-21T20:33:41Z

This recession has sent unemployment to new heights and that means more people are out of work. For some, that means doing whatever it takes to just find another job to help pay the bills. For others it means using this as an opportunity to change careers. If you're someone who has dreamed of changing careers but never had the ability to just quit your job and start fresh and now find yourself unemployed this presents a unique opportunity. Since you're already out of work you can now pursue that new career.

But, there's a catch. If it's in a different field than what you worked in before it isn't as easy as drawing up a resume and applying for jobs. It takes careful planning and may actually require a little more work than you anticipate. A career change isn't for everyone, so there are some important questions to ask yourself before taking the plunge. Here are some questions you should ask yourself before deciding whether or not to change careers.

Are You Prepared for a Career Change? originally appeared on About.com Financial Planning on Wednesday, October 21st, 2009 at 20:33:41.

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It is National Save for Retirement Week

2009-10-19T09:44:01Z

Did you know that more than half of U.S. workers have less than $25,000 saved for retirement? This statistic is shocking when you consider most people don't have full pensions provided by their employer and Social Security will pay out very little in retirement. To help build awareness around the importance of saving for retirement Congress has designated October 18-24 as National Save for Retirement Week.

The importance of saving for retirement can't be stated enough. We are living longer, dealing with higher health care costs, and fighting inflation, so we need to save more money and make it last longer than ever before. The only way to do this is to start saving. Save early and save often. To see where your retirement savings stands, try this 5-minute checkup.� After entering in some basic information you'll see how you're doing and whether or not you should make some changes.

And don't forget to check out many of the retirement planning resources here:

It is National Save for Retirement Week originally appeared on About.com Financial Planning on Monday, October 19th, 2009 at 09:44:01.

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Watch Out For Hidden Credit Card Expenses

2009-10-17T21:28:25Z

If you're like most people, you probably get a lot of credit card offers in the mail. Many of these offers provide some attractive low interest rates, balance transfers, or reward programs. While it can be tempting to take advantage of some of these offers, you have to be careful. These offers are usually short-lived and can be even more costly than you think.

Whether it is a teaser rate or hidden fees on balance transfers, you want to read all of the fine print before taking advantage of any credit card. Some promotions are legitimately worthwhile, but there is usually more to it than the big 0% they are promoting on the form. Learn how to spot these hidden fees and how to avoid them.

Watch Out For Hidden Credit Card Expenses originally appeared on About.com Financial Planning on Saturday, October 17th, 2009 at 21:28:25.

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