Comments on: The 5 Takeaways of Personal Finance

By: * Evolution Of Personal Finance Blogs

* Evolution Of Personal Finance Blogs — Sun, 31 Jan 2010 17:22:36 +0000

[...] The 5 Take-a-ways of Personal Finance at Prime Time Money [...]

By: personal budgeting

personal budgeting — Mon, 20 Jul 2009 08:53:35 +0000

Thanks for sharing such great post, according to me budgeting doesn’t mean that you have to compromise your needs but it is important for planning financial life. Household Budgeting means to create a planning for the money spending. Build emergency fund, minimize the use of credit card, planning, etc. are the tips for making personal household budgeting.

By: thom young

thom young — Wed, 15 Jul 2009 18:19:39 +0000

Why I certainly agree that it is not good to have too much credit card debt, having some is not bad, and why pay off the debt while the dollar is still relatively strong? but as you see is getting weaker by the day, so in the long term you will be paying back less because the dollar will be worth less, the credit card companies will be losing money because the dollar will be worthless once it loses its reserve currency status and the world shifts to the yuan or some other global currency controlled the IMF. I certainly do agree that you should pay off your credit cards, but in the long term it won’t matter, so don’t let your debt get out of control but remember the dollar is going to tank. I suggest you get all your money out of the stock market except in gold and silver and its related shares. It will be the emerging markets which soar in the soon future and not the dollar.

By: PT Money

PT Money — Wed, 15 Jul 2009 16:47:34 +0000

@Beth – Yes, most people have a hard time thinking past the next paycheck. A shame.

Life insurance benefits are not subject to income tax, but they may fall under estate tax rules. But I think that’s a rarity. Retirement plans, like the 401k are tax-deferred. So yes, they are taxed when withdrawn. Earning from a Roth IRA are not taxed at the end. It’s the reverse of the 401k.

As for insurance, I agree with your comments. A rule of thumb I use is to always treat life insurance as an expense vs an investment. And leave investing to other products, like 401ks, IRAs, etc.

By: Beth

Beth — Wed, 15 Jul 2009 16:39:23 +0000

Great blog! I hope people check it out. I will spread the word.

My hubby and I were talking the other day with a friend about retirement plans and such. We were surprised to find that in his local office (about 150 employees) less than 1/4 of the people he worked with took advantage of their 401K plan.

To me, that’s like leaving money on the table! ALMOST ALL employers will match what you put in. CRAZY not to do it!!! I think some people look at it like that’s “more money taken out of my check.” They are concerned with “right now” and not later.

The thing is, you really don’t notice that money is gone! Sometimes, what is taken out, will knock you in a lower tax bracket so you aren’t getting taxed so much.

Another point you made that is REALLY good, is get a life insurance policy. If you are relying on JUST your retirement to take care of your family, DON’T.

Correct me if I’m wrong, but I think retirement plans are taxed when withdrawn and subject to all types of penalties reducing the amount considerably…Life insurance benefits are not taxed (?) and you don’t have to pay ANYTHING. This will ensure your family is taken care of.

When buying a policy, TERM life is DEFINATLY the way to go. WHOLE life is a rip-off in my opinion. Know the difference! I read somewhere that the difference between Term life insurance and Whole life insurance can be compared to “buying” or “renting” a home.

You get the same outcome either way…BUT “buying” is always cheaper in the long run. TERM life is like “buying” a home. Your payments are cheaper and you get the SAME benefit. I think when buying a policy, 10 years income of the “primary” breadwinner is good.

By: PT Money

PT Money — Tue, 14 Jul 2009 12:51:04 +0000

Mark – Great points, man. A zero-based budget is something I’ve been meaning to do. Although, I typically just make sure that I save up front for the things I need and give myself freedom with the rest of the money. I think if some of that free money had a purpose I’d be more productive with it.

By: Mark N

Mark N — Tue, 14 Jul 2009 03:38:26 +0000

You may have mentioned this in another blog post but how about the Big One regarding personal finance? That would be making a monthly budget and sticking to it. You gotta sock away a bit of money each month to cover the non-monthly recurring expenses such as property taxes if you don’t have an escrow account, homeowners assocation dues, etc.

And here’s one that I like but that nobody seems to believe in. Strive to make big purchases, even something as expensive as a new automobile, in cash. Yes, cash. If you can pay the bank $600 a month for 48 months after you buy a car, you can sure as heck pay yourself $500 a month for 48 months BEFORE you buy the car. Put the money in a safe account like a cheap savings account. Even with the minimal interest earned, you’ll end paying a few hundred dollars less for the car in cash. And you do this with lower monthly payments into your new car fund. (I used $600 and $500 as examples. I didn’t figure out the correct amounts for an average priced new car.) Paying interest for 48+ months means you’ll end up paying several thousand dollars more than the cash price for the car. “Pay now or pay later” can be changed to “pay less now or more later”.