PT Money » Investing and Retirement

Traditional and Roth IRA Contribution Limits for 2012

Philip Taylor — Wed, 18 Jan 2012 17:08:15 +0000

The 2012 IRA contribution limits have not changed from last year. The main culprit seems to be that we haven’t experienced inflation.

Traditional IRA and Roth IRA

These Individual Retirement Arrangements or Accounts (IRAs) were created to provide a tax incentive to save for your own retirement. They are both excellent tools to help you in your efforts to secure a comfortable retirement. I have both types of accounts and I can tell you they are easy to setup and maintain: very similar to savings accounts. Contributions to your traditional IRA are generally tax deductible in the year you made the contribution. Contributions to a Roth IRA are not tax deductible, but the qualifying distributions you make from it are free from taxation. Because of these two advantaged, the IRS imposes annual limits on the contributions you can make to these accounts.

If you are unsure which IRA best suits your needs, CLICK HERE to use Mint.com and their IRA wizard. This tool allows you to compare IRA types and different discount brokers.

The Contribution Amounts Are Per Person and Split Across Accounts

A couple of points before we look at the contribution limits. First, there is no such thing as a joint IRA account. You, and you alone are assigned to your IRAs. Not your kids, not your spouse. Just you. Also, you can have multiple IRAs. You can have as many traditional and Roth IRAs as you would like. However (and this is the important part) your contribution limits are applied to your contributions across all accounts. For example, let’s say you have a traditional IRA, a traditional (Rollover) IRA, and a Roth IRA. You can only contribute up to the limit, split across all accounts in total. Now let’s look at those limits for the current year:

For Those That Will Be Under 50 at the End of 2012

The maximum that you are able to contribute to a traditional or Roth IRA is going to be the lesser of $5,000, or the dollar amount of how much you made (your taxable compensation) for the year. In other words, you can’t contribute more than you earned. This $5,000 limit hasn’t changed in a few years now. I’d like to see it bumped up soon. Also, keep in mind that your annual income can reduce the amount you are able to contribute to your IRAs. See my exhaustive rundown of the Traditional and Roth IRA income limits.

Catch-Up Contribution (50 Years of Age or Older at the End of the Year)

Because IRAs haven’t been around that long, and just because it’s a nice gesture (I guess), if you are 50 or older, you can contribute “catch-up” contributions to an IRA. So, if at the end of this year you are 50 or older, you can contribute the lesser of $6,000 or the dollar amount of how much you made (your taxable compensation) for the year. These contributions are also limited by your income. See IRS Publication 590 for all the dirty details.

Contribution Limit Table Showing Previous Year Contribution Limits

Let’s take a look at how the annual contribution limits have changed over the years. As, you can see, we’ve been holding pretty steady at current levels for quite some time. Back in the early oughts we got used to frequent increases. Now we have seen a significant slow down in the increases.

Tax Year	Contribution Limit	Catch-Up Limit
2012	5,000	6,000
2011	5,000	6,000
2010	5,000	6,000
2009	5,000	6,000
2008	5,000	6,000
2007	4,000	5,000
2006	4,000	5,000
2005	4,000	4,500
2004	3,000	3,500

Why These Limits Matter

Use these contribution limit numbers to help you plan your retirement savings this year. If your goal is to reach the maximum (a great idea), then be sure to set up automatic contributions to your IRA to ensure that you get it done. You don’t want to be waiting till the end of the year (or the date you file your taxes) to start thinking about contributing. Happy saving!

Traditional and Roth IRA Contribution Limits for 2012 is a post from: PT Money: Personal Finance by PT.
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TradeKing Online Stock Broker Review

Michael — Wed, 28 Dec 2011 03:45:54 +0000

Trading stocks online for the first time can be a scary venture, especially if you’re not familiar with what an online stock broker can offer. One of the leaders in cheap stock trading is TradeKing, a company that’s been around since 2005 and is based in Boca Raton, Florida. TradeKing has always offered one of the lowest commission rates in the business and touts many awards from Barrons and Smart Money for their overall experience. Let’s take a closer look at what TradeKing is all about.

TradeKing Sign Up Process

Signing up for a TradeKing account is simple and takes about five minutes. You’ll be taken through five different pages, each of which requires a bit of personal information as well as questions on how experienced of a trader you are. Once completed, you will not be given immediate access to TradeKing as your application is sent for approval. While I’m not entirely sure what would prevent you from opening an account, a credit check is not pulled, so you can breathe a little.

TradeKing Commission Structure

In terms of pricing, TradeKing is one of the best around, especially if you need a broker to help you out. $4.95 trades whether made online or through the help of a licensed TradeKing broker and $0.65 for every options contract. If you are trading penny stocks (meaning stocks valued at under $1.00) you will be charged an extra $0.01 for every share traded. The low price is one of the best available and it’s only one of the very many reasons to open a TradeKing account.

TradeKing Customer Service

I decided to test out all areas of customer service and here are the results

TradeKing Live Chat – I was connected with an agent 5 seconds after clicking on the live chat link and was informed that the live chat feature is available from 8amET – 6pmET Monday-Friday.
TradeKing Telephone Support – Again, I called their toll free number (877) 495-5464 and was immediately connected to a live agent. Service hours are the same as live chat: 8amET – 6pmET Monday-Friday.
TradeKing Email Support – Emails can be sent in anytime but understand that responses will come at the same time telephone and live chat services are available. This means if you email TradeKing late on Friday, you will most likely receive a response the following Monday.

TradeKing Trader Network

TradeKing has a feature that few online stock brokers have and that’s a network designed for interactive traders. The TradeKing Trader Network is made up of all TradeKing account holders and offers assistance and educational tools to help you make the right portfolio decisions. To help you out even more, you’ll find a list of 22,000 TradeKing account owners and the transactions they’ve made this year! The list is ordered by number of trades but you can also order it based on stocks owned, number of groups they belong too or number of blog articles they’ve contributed.

TradeKing Awards and Accolades

Visiting the page TradeKing has designated for recent awards, you’ll find 14 current accolades, mostly from Smart Money and Barrons. Their five most recent awards are:

#1 Customer Service – Smart Money 2010
#1 Options Trading – Barrons 2010
#1 Customer Service and Tools – Smart Money 2009
#1 Options Trading – Barrons 2009
Leader in Website Speed and Availability – Gomez 2009

TradeKing Overall Customer Satisfaction

When you take a look at everything TradeKing has to offer, they stack up against any online stock broker and especially those that offer cheap stock trades. Their commission structure, customer service and trading tools are as good as anyone else in the business.

If you’re in need of a new online stock broker, you should seriously consider all that TradeKing can provide for you.

TradeKing Online Stock Broker Review is a post from: PT Money: Personal Finance by PT.
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$75 Cash Bonus from ShareBuilder

Michael — Sat, 24 Dec 2011 06:00:13 +0000

There’s a somewhat secretive offer making it’s way around the investing community; ShareBuilder is offering a $75 cash bonus for new account holders that deposit just $100 into their account before the turn of the year. The standard bonus offered from ShareBuilder is $50 (with restrictions) but this new bonus has absolutely no rules or trade requirements of any-kind, making it one of the most lucrative I’ve ever seen.

In order to qualify for the $75 cash bonus, which can be withdrawn 120 days after it is added to your account (which takes 4-6 weeks on it’s own) you must do the following:

Open a ShareBuilder trading account before 12/31/2011.
Fund the account with a minimum of $100.
Manually enter promo code EXTRA75 into your ShareBuilder application. The landing page for ShareBuilder will show a $50 bonus but don’t be fooled. The promo code guarantees the $75 bonus.

Just to make sure I’m giving you all of the pertinent details, here’s the official rules from ShareBuilder:

You must open a new ShareBuilder account and deposit $100 or more to be eligible for this promotion. Initial deposit must be completed by 12/31/11. ING DIRECT Investing will deposit a $75 bonus approximately 4-6 weeks after your first $100 deposit. The $75 bonus offer is available for Individual, Joint and Custodial accounts only. Offer not valid for IRAs or ESAs. The $75 bonus is not available for withdrawal for 120 days after it is awarded to your account. This offer is not valid with any other offers and is non-transferrable. Limit one ShareBuilder account bonus per unique customer or custodial beneficiary. We reserve the right to terminate this offer at any time and to refuse or recover any promotion award if we determine that it was obtained under wrongful or fraudulent circumstances, that inaccurate or incomplete information was provided in opening the account, or that any terms of our Account Agreement have been violated. Offer expires 12/31/11.

A $75 cash bonus for a deposit of $100 is about as good as you’ll ever get in terms of free money from online discount brokers and without requiring a single trade, this is a must use for any potential investor. Sign up your wife, kids and anyone else that could benefit from the bonus but make sure that the account is NEW, or the promo code will be rejected.

ShareBuilder continues to offer automatic investing trades a $4 a pop and is owned and operated by ING Direct Investing; a consumer favorite year in and year out. Visit ShareBuilder.com and secure your $75 cash bonus before the new year w/ promo code EXTRA75

$75 Cash Bonus from ShareBuilder is a post from: PT Money: Personal Finance by PT.
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Carnival of Financial Planning – Edition #213

Philip Taylor — Fri, 02 Dec 2011 16:31:28 +0000

Best Personal Financial Planning and Personal Investment Articles this Week from Personal Finance Blogs

Welcome to the December 2, 2011 Edition #213 of the Carnival of Financial Planning.

The Carnival of Financial Planning takes a long-term view of personal financial planning for individuals and families. We focus on efficient and sustainable personal financial planning practices that can lead to lifetime financial security.

This edition is arranged by subject heading, so that you can browse efficiently.

Enjoy!

The Skilled Investor, Editor

Budgeting and Economics

J.B. presents Managing Your Impulsive Buying Habits posted at My University Money, saying, “Impulsiveness can be fun at times, but it has a way of surprising you at the end month when that credit card statement comes in the mail.”

Janet presents Canadians Ready to Give Up Cash in Favour of Convenience posted at Credit Cards Canada, saying, “These days, it’s all about the plastic — and even the digital money. In fact, many Canadians would feel quite comfortable without ever handling cash at all, and many of them are in favour of a digital wallet.”

Super Saver presents Four Things Not to Buy and Save Money posted at My Wealth Builder, saying, “Not buying the same four items may not work for everyone, but I’m pretty sure that most people have at least one item that is nice to have but not a necessity.”

Beating Broke presents We Conquered Black Friday posted at Beating Broke, saying, “We stuck to our list, only buying one extra item on Black Friday. We not only kept to our budget, but we beat it! When we were done with our busy morning of shopping, we had everything on our list, and we’d spent less than $150!”

Rogan Seager presents Retirement Savings Calculator posted at Retirement Savings Calculator, saying, “Valuable future investment portfolio assets and future investment returns slip through many people’s fingers at the checkout stand every day, because they spend beyond their long-term means.”

Control your Cash presents What coverage should you get when renting a car? (II of II) posted at Control Your Cash: Making Money Make Sense, saying, “About the different kinds of insurance add-ons car rental companies charge, and why they’re largely a waste of money. We saved the best one for the end, one that can end up costing you more than the rental itself.”

N.W. Journey presents Pay Yourself First posted at Networth Journey, saying, “Learn the importance of paying yourself first”

Sustainable PF presents Family Finances posted at Sustainable Personal Finance, saying, “Who handles your family finances? Is it just one person or is it a joint effort? When it comes to the personal financial plan for a family, there are many ways to approach managing the budget.”

Estate Planning

Marie presents Should You Ditch Your Bypass Trust? posted at Family Money Values, saying, “Many married couples have Bypass Trusts set up to ensure that each of their individual estate and gift tax exclusion amounts are used to the fullest. Now that tax laws have changed to automatically transfer the exclusion, should you get rid of your trust?”

Financial Planning

humble savers presents Five Ways to Save – To be a Millionaire | Humble Savers posted at Humble Savers, saying, “The simple facts for wanting to reach a cool million”

Jen presents Net Worth Update~ November 2011 | Master the Art of Saving posted at Master the Art of Saving, saying, “Last month, our Net Worth increased by $692.17, which really seems great compared to this month. This month our Net Worth has decreased by $1,655.60 and it really sucks. Increases in other areas helped to somewhat offset a good amount of our vacation spending, so that’s cool. Hopefully next month will go better.”

Carlos Sera presents An Actual Tale | Financial Tales posted at Financial Tales, saying, “Today I release An Actual Tale – “How Financial Advisors Lie” for those that want to understand how the stock market calculates rate of return. If you think that the stock market averages 10-12% per year for example—you better understand what that means to your pocketbook. It does not mean you will make 10-12% per year. You will make less. If you’re asking yourself, “What is the difference between average returns and actual returns,” this tale will answer that question.”

SteveR presents Tips For Avoiding Consumer Debt Over the Holidays posted at Debt Consolidation, saying, “Holidays are meant to be joyous occasions full of togetherness for friends and family.”

Matt presents Six Ways to Control Home Remodeling Costs posted at Living in Financial Excellence, saying, “Diving into a remodeling project without proper preparation, however, is a risky prospect. You need to commit to planning and forethought to make sure that your modest remodeling idea doesn’t become costly. Below are some tips to get you started.”

Corey presents How Being Thankful Affects Your Finances posted at 20′s Finances, saying, “Learn how being thankful affects your approach to finances. Read my article and see if you agree?”

D.J. presents Why Do I Need to Assign a Power of Attorney? posted at The Family Wallet, saying, “Everyone should at least consider having a POA. Should you become incapacitated without having a POA, a judge will have to appoint an agent to manage your affairs; agent responsibilities do not automatically default to your closest relative.”

Marie presents What Happens to Your Assets During a Divorce? posted at Money Spending Mommy, saying, “If the divorcing couple can come to an agreement on the division of assets, the issue may not need to go to court. Otherwise, all assets must be reported to the judge and he must make a decision. The division of assets depends on several factors, and it is not always equal.”

Larry Russell presents Identity theft protection and prevention posted at Personal Investment Management and Financial Planning, saying, “As a threat to your financial security, you should take the potential for identity theft very seriously. Identity theft sometimes entails a loss of your money, but whether or not you lose money, it can take a very large amount of your time to rectify. Taking these steps to prevent an occurrence is prudent.”

Corey presents Alternative Plans For Financial Independence posted at Money Reasons, saying, “Don’t stick with just one plan for financial independence! Who knows, perhaps Plan B will get you there instead!”

Jon the Saver presents 5 Ways People Waste Money on Their Cars posted at Free Money Wisdom, saying, “Below are five common ways people waste money on their cars.”

Frank Knight presents Investment Asset Allocation posted at Retirement Planning Software, saying, “When you are already there and invested in an asset class, you are following a passive asset allocation strategy. Tactical asset allocation strategy advocates suggest that you can anticipate the crowd, but flow-of-funds studies show that almost all tactical asset allocation fund flows are late money flows that chase performance after valuations have already moved.”

Suba presents Year End Financial Planning Checklist posted at Wealth Informatics, saying, “This time of the year is an excellent time to check your financial state and make changes. I have included a handy checklist and a calendar to have a “wealth checkup” in all areas of finances.”

Financing a Home

Kevin presents How to Find the Home of Your Dreams posted at Invest It Wisely, saying, “When we first started home shopping, I thought we’d look at different places, eventually fall in love with one and decide to go for that. The reality was actually somewhat different!”

Financing Education

Aloysa presents The Best Things in Life Should Not Cost You a Thing posted at My Broken Coin, saying, “Thanksgiving is the time to reflect on life, time, relationship and family. I asked myself one very simple question that was asked by humans a gazillion times. Can money really buy happiness?”

Income

Will presents Why I’d Rather Earn More Money Than Spend Less posted at Former Banker, saying, “Frugality can only get you so far. You need to kick it up a notch if you want to really build wealth”

Investing

Dividend Growth Investor presents Should you follow Buffett’s latest investments? posted at Dividend Growth Investor, saying, “Warren Buffett is one of the most successful investors of all time. Investors who closely followed Buffett’s moves in the Berkshire Hathaway (BRK.B) stock portfolio between 1976 and 2006 would have significantly outperformed the market. So should investors follow his latest moves?”

Hank presents Four Places To Find Great Stocks To Invest In posted at Money Q&A, saying, “One of the biggest complaints that I often hear is that people do not know which stocks to invest their hard earned money in. Here are four easy ways to find great stocks.”

101 Centavos presents Centavos Dividend Portfolio: Uptrend Update posted at 101 Centavos, saying, “The market popped a bit yesterday, and what better time to post a dividend portfolio update? Find out how my portfolio is doing.”

Glen Craig presents Don’t Get Too Hung Up on the Value Investing vs. Growth Investing Debate posted at Free From Broke, saying, “People like to pigeon-hole their investing style. Some stick to value investing while others are growth investors. Don’t get hung up on the value investing vs. growth investing debate. Many stocks blur the lines.”

Intelligent Speculator presents Yahoo (YHOO) As Alive As A Zombie posted at Intelligent Speculator, saying, “We look at the negatives of Yahoo.”

Frank Bertin presents Index Funds posted at Top Index Funds, saying, “Top ten no load index funds that track the Standard and Poors 500 composite index in terms of lowest costs.”

FMF presents Is My House an Investment? posted at Free Money Finance, saying, “Just because something costs a lot doesn’t mean it is an investment. An investment is something that pays you money. For most families the largest purchase they make will be their house. It is crucial to understand how to consider real estate holdings in every aspect of wealth management, from asset allocation to retirement planning.”

Janet Russell presents The illusion of superior professional mutual fund manager performance posted at Personal Investment Management, saying, “If investment mutual fund managers were truly skilled at beating the market, then you would expect mutual fund manager performance prowess to persist over time. The effort to find those few supposedly superior money managers willing to sell their services sufficiently cheaply is a costly, time consuming, and futile, “Where’s Waldo?,” searching exercise for the individual investor.”

Cash Flow Mantra presents Warren Buffet, Intel and Me posted at Cash Flow Mantra, saying, “There are plenty of good ideas out for investing out there. I think the problem comes because there can be too much information for some people to decide. Should I invest in individual stocks or mutual funds or exchange traded funds? Should I use bonds or preferred stocks or CDs for income? How much international exposure should I have?”

Ken Faulkenberry presents Is Investment Asset Allocation By Age Rule of Thumb Valid? posted at AAAMP Blog, saying, “Asset allocation by age is now being questioned by many financial analysts because of changing market conditions and a growing debate on valuation investing vs. buy and hold investing.”

Mirelle Rowden presents Fixed Income Funds posted at Best Bond Mutual Funds, saying, “Vanguard dominates this low cost United States bond mutual funds marketplace for direct purchase accounts with both low and high minimum deposits.”

Dividends4Life presents 9 Low-Risk, High-Yielding Dividend Stocks posted at Dividend Growth Stocks, saying, “If your goal is to accumulate wealth for a comfortable retirement, then there is no risk-free path. Yield and risk tend to follow each other. As risk increases, the investor demands more yield to compensate for that risk. Sometimes it is desirable to accept higher risk for a higher yield. Other times we may be accepting higher risk and are not being adequately compensated for the additional risk.”

Managing Credit and Debt

Control your Cash presents Peeling Back The Onion Of The Durbin Amendment posted at Control Your Cash: Making Money Make Sense, saying, “Unintended consequences from the Dodd-Frank Wall Street Reform and Consumer Protection Act.”

Jacob presents Four Letters That Will Help You in Your Debt Payoff Journey posted at My Personal Finance Journey, saying, “This post describes four different letters one can strategically write in order to help attack debt and become more secure in their overall financial goals.”

Marjorie presents Get your credit card interest rates lowered posted at CardHub.com, saying, “I show that no matter what their situation, there is a way to tackle the high interest rates on their credit cards.”

Jim presents What Is A Good Credit Score? posted at Bargaineering, saying, “It’s easy to get all worked up about credit scores but what exactly is a good score? What does it affect and why does it matter?”

Miscellaneous

DanielPacker presents Why You Shouldn’t Do What You Love for a Career posted at Sweating The Big Stuff, saying, “Making money is great, but a lot of people say that if you love what you’re doing, you’re in an even better position. I argue with that and will make a convincing argument that doing what you love for a living could be a bad thing.”

Bob presents How to Raise Money for Community Service Projects or Missions posted at ChristianPF, saying, “If you are trying to raise money for a community service project or a mission trip and you know that others would like to help you reach your goal then here are a few ways to raise the money.”

Boomer presents How To Protect Yourself From Identity Theft posted at Boomer & Echo, saying, “Identity theft is the fastest growing crime North America. The majority of cases involve unauthorized purchases on credit cards and debit card skimming.”

The Skilled Investor presents Market Timing Does Not Work posted at Personal Financial Management, saying, “Always stay invested to earn risk premiums. You must have your money invested and at risk to get risk premium returns. Jumping out and in or “timing the markets” doesn’t work.”

Peter presents Thanksgiving Day: Should It Be the Only Day We Give Thanks? posted at Bible Money Matters, saying, “I know first hand that it isn’t always easy to be thankful, especially when you’re in the midst of hard times. It’s so much easier to dwell on the misery and allow the negative to overwhelm.”

Tripp Danner presents No Load Funds posted at No Load Fund, saying, “There are over 60,000 different mutual fund investment share classes sold worldwide. Some mutual funds and ETFs must be better than others, but which ones are they? How can you tell before the fact?”

Odysseas presents What’s the Connection Between Unions and Your Wallet? posted at Wallet Blog, saying, “Unions are inextricably tied to the U.S. economy. They have served an important purpose, ensuring that there is a balance of power between management and labor. But what if things have gone too far? Could unions actually be costing Americans jobs by forcing companies to outsource? And, if so, what’s the solution?”

Craig Ford presents 10 Easy to Plan, Cheap, and Fun At Home Date Ideas posted at Money Help For Christians, saying, “10 fun date ideas you can easily enjoy at home.”

Retirement Planning

Christine presents Retirement Plans for Teens posted at Me, My Kid and Life, saying, “This article is about planning for a self-employed teenager’s retirement.”

Brockton Eaton presents Long Term Investment Strategies posted at Retirement Investment Strategy, saying, “The investment research literature repeatedly demonstrates that a fully diversified, low cost investment strategy is superior.”

Mr. Money presents Retirement: Know Your Housing Options posted at Smart on Money, saying, “As you prepare for retirement, one of your challenges is going to be figuring out where to live. The process of aging means that you might need special care as you get older.”

Walter Binkle presents Large Cap Mutual Funds posted at Mutual Funds, saying, “Retirees can save a lot by paying attention to mutual fund expenses. Each of these S & P 500 index funds is among the least costly on the market.”

Super Saver presents Avoiding “Big Company” Organizations posted at My Wealth Builder, saying, “After taking early retirement, I decided to work for smaller companies which allowed me to avoid corporate bureaucracy and better leverage my experience and personal strengths.”

Risk Management and Insurance

FMF presents The Dangers of Life Insurance Policy Loans posted at Free Money Finance, saying, “Borrowing from a policy can be helpful when times are tough, but loans must be used responsibly. The policy can relapse if the loan is not repaid, and the loans can be complex and destructive if not handled with care.”

Savings

Jason P. presents Best Instant Access Savings Accounts posted at Childrens Savings Accounts HQ, saying, “Access your money without penalty using instant access savings accounts and help your child save for the future.”

Steve Zussino presents Save on Foods Coupon Stacking Guide posted at Grocery Deals in Canada, saying, “Save on Foods Grocery Store can be an amazing place to shop for those who are looking to save money. This store not only has amazing weekly deals, but for those who want to save as much as possible on groceries, they offer ‘stacking.’”

Lina Zussino presents Ways to reduce the cost of baby food posted at Baby on a Budget, saying, “The problem with buying pre-made baby foods is that it can seriously burn a hole in your pocket, especially if you have a hungry baby!”

Chelsea Prescotti presents Top 10 Things You Should Never Buy New posted at CreditScore.net, saying, “Shiny new toys are always nice to have, even as an adult. While those nifty new items might feel good, they are not always a wise choice. When it comes to new versus used, the following ten items are things you should always buy used, when feasible. You won’t give up value, but you will save cash, provided the items are in good condition.”

Miranda presents 45 Ways to Save Money posted at Financial Highway, saying, “Do you want to start your own business and make a little extra money? It can seem daunting at first, since there are so many others out there trying to get something started. Here are 4 creative business ideas that can help you get started.”

Bradson Oakley presents Bond Mutual Funds posted at Best Bond Funds, saying, “Higher bond fund expenses tend to mean lower net returns to individual investors. It is not worth paying higher bond fund fees.”

Don presents Frugally Saving Money By Taking Advantage Of A Very Unusual Opportunity posted at Money Reasons, saying, “Do you see dollar signs when you see roadkill along side of the road? I knew a guy that did, and this is his story.”

SavingMentor presents How to Save Money by Using Coupons posted at HowToSaveMoney.ca, saying, “I think coupons are a great way to cut your monthly budget on groceries and household goods, though one must be cognizant of spending more money when you’re trying to save money. I have a tendency to fall into trouble with this, as I go for the purpose of saving money and end up buying a few things that weren’t on my ‘list’.”

Ciana Locke presents Market Index Funds posted at Best Index Mutual Funds, saying, “The dominant issue in choosing among passively managed index mutual funds and ETF funds benchmarked against the S & P 500 is that securities industry management and trading fees are all over the map from reasonably low to shockingly high.”

Jason presents Black Friday Mayhem posted at Live Real, Now, saying, “In my mind, shopping major sales early in the morning with 5000 people who wish they’d have thought of bringing pepper spray is just an example of Hell beta-testing a new level of pain.”

YFS presents Must Know Shopping Tips for Cyber Monday posted at YourFinancesSimplified, saying, “YFS tells you how to make the most from Cyber Mondays by providing shopping tips.”

Clint Cora presents How Business Speaker Avoiding Airline Baggage Fees posted at Motivation Diversity Success Blog, saying, “How I avoided those ridiculous airline baggage fees during my last trip”

Jason P. presents Easy Crockpot Meals: Save Time and Money posted at One Money Design, saying, “Looking to save some extra money? Consider using a crockpot to make things easier and to help watch your spending.”

Taxes

Finley Merriwether presents Retirement Planning Calculator posted at Retirement Plan Calculator, saying, “Tax-advantaged retirement savings plans give you the opportunity to make investments with deferred taxes in 401k, 403b, 457, Keogh, Simple, or other employer sponsored retirement plans.”

Investor Junkie presents Tax Benefits of Donating to Charity posted at Investor Junkie, saying, “During the holidays, many people’s thoughts turn toward giving to others. While you might want to give, just for the joy of charity, there is no reason to discount the advantage that can come with donating as well. Consider that when you donate to charity, you do a good deed, and you can reduce your tax liability.”

That concludes this edition. Submit your blog article to the next edition of Carnival of Financial Planning using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

Technorati tags: carnival of financial planning, blog carnival.

Carnival of Financial Planning – Edition #213 is a post from: PT Money: Personal Finance by PT.
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3 Big Lessons From the MF Global Bankruptcy

Emily Guy Birken — Thu, 17 Nov 2011 19:00:26 +0000

By now, you have likely heard about the downfall of the broker MF Global.

What is shocking about this money giant having to declare chapter 11 bankruptcy as of early last week is not the fact that it bet on European sovereign debt and lost (to the tune of over $6 billion).

The real shocker comes from the fact that nearly $600 million of customer funds are “unaccounted for” and the revelation that the firm may have commingled clients’ money with its own assets.

While the majority of the investors who are currently sweating bullets because of MF Global’s actions are institutions, this mess can teach all investors some important lessons.

1. Never invest in something you don’t understand. I’m lucky enough to be the daughter of a financial planner, and this is a lesson I learned at his knee. And it certainly seems appropriate to this situation.

Despite being a money-savvy, intelligent and generally well-informed individual, I still cannot wrap my head around the European debt crisis—or how one would make money from it.

If you do not understand how something you’re investing in works, then it will be very difficult for you to know when things are changing in ways that will negatively affect you. So either take the time to really educate yourself about your investments, or only choose investments that you can understand without extra research.

Because the MF Global debacle really highlights the fact that you are the only person you can absolutely trust to look out for your own best interests.

2. Insist on transparency. MF Global’s investors would certainly not have allowed their money to commingle with the broker’s money if they had known about it. But they didn’t know about it because there is no requirement for transparency for investments in hedge funds and commodities.

In a nutshell, MF Global was able to do something unethical and irresponsible with its clients’ money because it did not have to disclose its activities.

If you keep your investments in publicly traded mutual funds, you can rest easy thinking about your money because your mutual fund is required to provide disclosure of its activities and your money is in the possession of a fund custodian.

While there are never any guarantees, these security measures will help keep you from being an investor whose money is “unaccounted for.”

3. Don’t get dollar signs in your eyes. The reasoning behind MF Global’s risky investment strategies comes down to greed. The broker hoped to get a high return from its trading, but it ended up losing big.

You have to remember that a high rate of return means that you must accept a high risk. If you can afford to lose your stake, there’s nothing wrong with playing for big money. But playing is exactly what you are doing. There is very little difference between gambling and investing your money in something risky. (Except when you gamble, you generally get complimentary drinks).

It doesn’t help that investments in risky hedge funds and commodities are structured so that fund managers are encouraged to make risky decisions with the money they are managing—your money.

Investing in mutual funds and other slow-but-steady performers is a better bet for maintaining and growing your nest egg. It’s not a race to the finish line—though it may feel that way to those close to retirement. No matter what your circumstances are, don’t let fear, greed or time pressure blind you to the potential consequences to risk.

This will not be the last investment giant to fall due to poor decisions and risky investments. But if you follow these tips, you will not be one of the individuals hurt by the next downfall.

3 Big Lessons From the MF Global Bankruptcy is a post from: PT Money: Personal Finance by PT.
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E*Trade $500 New Account Bonus + 60 Days of Free Trades

Michael — Tue, 15 Nov 2011 20:45:48 +0000

If you’ve been looking for a new place to make online trades, look no further than E*Trade. From now until December 31st 2011, new account holders can earn up to a $500 cash bonus, as well as free trades for the first 60 days the account is opened. In terms of the cash bonus, the maximum amount you can receive is $500 and depending on your deposit size, your cash bonus will be in the following amounts:

Deposit Amount	Cash Bonus
$250,000+	$500
$100,000 - $249,999	$250
$50,000 - $99,999	$100
$25,000 - $49,999	$50

In order to qualify for the bonus, you must make the deposits within 45 days of opening your new E*Trade account AND the funds must remain in your account for a minimum of six months, otherwise you could forfeit the bonus. (Terms of forfeiture are a little unclear)

The second part of the bonus deals with 60 days of free trading. To be clear, you will NOT be making free trades real time, rather you will be reimbursed for all of the trades you make during the first 60 days of opening your E*Trade account, up to 500. Additional details:

Cash bonuses will be credited within 8 weeks
No credit will be given for unused trades
Only valid on E*Trade trading accounts (not E*Trade IRA’s or banking accounts)
Account must be funded with a minimum deposit of $2,000

E*Trade certainly isn’t the cheapest broker around with trades of $9.99 and $7.99 (after you make 150 trades) however their technology and customer service has always been regarded as the best around. With a bonus offer attracting new customers who either trade frequently or in large amounts, you can see why serious online trades vote E*Trade the best year in and year out. To sign-up for this limited time offer, visit E*Trade through any link contained in this post.

E*Trade $500 New Account Bonus + 60 Days of Free Trades is a post from: PT Money: Personal Finance by PT.
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Forget The Hype Of Missing The Market, I’m Buying Gold!

Guest — Thu, 20 Oct 2011 11:00:18 +0000

This is a guest post by Hank Coleman who writes about money and investing on his blog, Money Q&A.

Should You Invest in Gold?

Are you a gold bug?

Like many things that are hot and popular to talk about on financial cable news shows and on the internet, you either love gold or you hate gold as an investment.

Which camp do you fall into?

For the longest time, I have been telling everyone on my blog and in articles that I’ve written on other sites that I think gold is a terrible investment.

But, let me let you in on a little secret. I’ve been secretly buying gold for years while still bad mouthing it the entire time.

Yes, there, I’ve said it. I’m a fraud….sort of.

There Are Plenty Of Reasons You Shouldn’t Buy Gold

There are plenty of reasons that you should not own gold as an investment. If you are just now thinking about buying it, you’ve missed the huge move in gold. It has had an incredible run up over the past couple of years in tandem with the current recession. It hit its 52 week high recently, and the precious metal currently been trading around the $1,700 per ounce level lately.

I absolutely hate buying any investment near its 52 week high price. There doesn’t seem to be much upside left to the investment, and there seems like whole lot of downside. For many people who have not invested yet, it appears that they may have missed the boat.

Another reason that I don’t want to own gold is that it is hard to liquidate. My uncle told me the other day that he purchased gold coins from a company that he saw advertise on late night television. That’s all fine and well if that is what you really want to do with your investment money and pay high fees. But, what happens when you need to sell those coins?

It is going to take a little while to find a buyer who will pay you the full price of your gold coins. And, you can forget about taking them to a pawn shop or jewelry store with a “we buy gold” sign in the front window. They only pay pennies on the dollar for your gold in order to resell it themselves.

Everyone who is a gold bug loves to praise gold as a hedge against inflation. Well, that sounds like a great idea while you are simply buying and selling on irrational fears of a stock market or world collapse. But, the hedge theory starts to fall apart when you actually have to put it into practice. When was the last time we were all out there bartering for things like gas or cable television with gold doubloons?

Even the Greeks are walking around the streets of Athens with solid gold coins in their pockets as a hedge against their country’s impending financial collapse. And, finally, just on principle alone, I’m not buying anything as an investment for my financial future that is sold through infomercials on late night television.

Why I’m Bucking The Trend And Buying Gold

I still hold true to my hatred of gold. I hate anything that has built up so much hype and has spawn so many self-serving vultures that prey on people’s fears. With all that being said and all my excuses, I still own gold in my own investment portfolio. So, why am I such a traitor to the fight against gold bugs?

There are several reasons actually. The biggest reason that I have invested in gold is for the diversification that it offers. Gold’s performance is typically inversely related to the stock market. So, when stocks are zigging, gold is often zagging the opposite way. It evens out the risk of the market’s swings.

Do I think that the stock market is doomed? No way! I’m a bull through and through, but I also have decades before I will reach the ripe old age of retirement. I can wait the market’s downturns out because I truly believe that the markets will continue to move higher over the very long-term. Do I know when things will turn around? Of course I don’t.

But, I feel confident that the market will eventually head higher and continue to do so over the long-term. Until then, I love having a portion of my investments that are heading higher while I wait.

Where To Buy Gold

There are so many ways that you can purchase gold as an investment, and almost always the best sources do not come from your television set, the other end of a phone call, or an instructional DVD a company sends you. You don’t need to buy an overpriced system to invest in gold.

There are several great exchange traded funds (ETFs) and mutual funds that focus on gold and other precious metals. I will always choose a great, professionally run mutual fund that specializes, lives, and breaths gold, gold miners, gold refiners, and other gold related companies over buying gold bullion and coins to stash under my bed every day of the week and twice on Sunday.

Gold can be a great investment as a small percentage of your total investment portfolio, such as limiting your investment to 5% to 10% of your total nest egg. That will help you diversify and wait out the market turmoil. But, you also have to be smart when purchasing gold and other precious metals about where you buy them from and how the investment is structured.

What about you? Do you have any gold bars hidden under your bed or in the closet in case the world ends? Do you secretly drool over those late night infomercials on television praising gold’s benefits? I’d love to hear your experiences with buying gold.

Be sure to follow Hank Coleman on Twitter @HankColeman and sign up for Money Q&A RSS Feed.

Photo by digitalmoneyworld

Forget The Hype Of Missing The Market, I’m Buying Gold! is a post from: PT Money: Personal Finance by PT.
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Is An Expensive College A Good Investment? The Definitive Answer

Guest — Thu, 15 Sep 2011 23:00:01 +0000

The answer to this question is almost always “no”. In fact, if you’re interested in making a good living, you can land plenty of fantastic jobs without a college degree. But before we get there, you have to understand a little bit about the misguided reports and studies that have been published that try to answer this question.

Many of the people who write articles on this subject are fancy-pants journalists who went to fancy-pants colleges. They are still paying their student loans. They are up to their eye balls in debt and they are puzzled as to why they don’t have a good credit score. Regardless of how they come down on the subject, they usually miss some pretty core issues.

A recent study by Payscale.com found that public schools have a higher return than private schools for the most part. That part, they got right.

But they go on to say that the students at more selective schools do better than those who attend less selective schools. They assume that the school has something to do with the students’ ability to be successful. They didn’t even consider or test the idea that the students who attend these schools are the “success factor” well before they even apply for admission. A go-getter is obviously going to apply herself at a competitive school. What’s the surprise when graduates from these schools do well? They would have done well had they gone to any school.

These studies also point to the high-earnings of students from top-ranked schools like Harvard, Princeton and Yale. They don’t account for the fact that the kids who attend these schools are already from pretty well to do families. That just might have something to do with the fact they make some good money. The studies you’ll see that try to answer this question look at the averages and of course, that’s meaningless. You don’t get a college degree in “averages”. You get one in physics, math, engineering, or surfing. Why waste time averaging the income of the scientists with the surfers? Stupid study.

I recently heard an HR expert being interviewed. She said that after 5 years, the impact of where our degrees come from is completely neutralized. So according to this woman’s experience, students might get a bump right out of the gate. But after a few years, your abilities is what counts – not what school you attended. (I wish I could have sourced this woman but I was driving at the time. Safety first.)

Having said that, you might ask if college (any college) is worthwhile. The bottom line is that college is financially worth it as long as three conditions are met:

You know what you want to do for a living.
A degree is a requirement to advance in your career.
You don’t spend more money than you have to achieve your goal.

You know what you want to do for a living

If you have limited resources you have to have financial priorities. So if money is scarce, don’t waste time or money. Would you buy a yacht if you didn’t know you liked sailing? Well that’s about what you’ll spend on a college career that will be dry-docked if you don’t have a plan to use that degree. Maybe private career colleges are a better fit.

But let’s be clear. If you know you want to be a business professional, you’re going to need a business degree. It may not matter than much if you get a degree in Finance, Accounting or Marketing… but you will likely need a degree.

If you have no clue what you want, don’t go to college. You may end up working on a fishing boat in Alaska (and make more money while having a lot of fun). Why waste the time and money going to college unless you have a pretty good idea that it’s going to be useful to you in your career? And how can you know that unless you have at least a general idea about what you want to do for a living?

The degree is a requirement to advance in your career

Really, I think I’ve made my point above. I could never have become a financial planner without a business degree. My accounting degree helps me understand investments of course even though I don’t do taxes or accounting. Still, having this background is really helpful.

On the other hand, a man I know never went to college and owns 25 very popular restaurants throughout the United States. He has more money than I’ll ever have and didn’t need college at all. Sure, college probably would have been helpful to him along the way, but the four years he spent working behind the counter and doing dishes gave him a lot more opportunity. In fact, had he gone to college, it’s possible that he would not have been as successful. He would never had agreed to be a dishwasher and work his way up. He’d have demanded to have a middle management position—where he’d probably still be today.

You don’t spend more money than you have to

For a very select few, a prestigious undergraduate college degree is going to be a ticket to better law schools, medical schools and jobs. That’s undeniable. But for most of the people who attend these high-priced schools, it will be a waste of money. The experience my daughter is having right now convinces me that you can obtain an expensive college education for a fraction of the price. For those of us for whom college does makes sense, that will be a good decision. But our financial success in life is determined much more by our personality traits and work ethic than by the name of the school we attended. Sorry…it takes a little more work than that.

Funding options for college students

Is that to say a liberal arts education is a waste? No… not really. Getting a degree in Greek Mythology is probably very rewarding on a personal level for the right person. I’m just saying it’s not going to help you get out from behind the counter at Flippy Burger. In summary, think about college as you would any other investment – because outside of your home, it’s likely to be one of the biggest investments of your life.

If you don’t know what you want to do, even generally, get a job and figure it out before you go to college. If you do know what you want to do and it requires a college education to demonstrate responsibility and to give you the background you need, go get it. Just don’t spend more than you absolutely have to.

What role has your degree played in your career? What would you do differently?

The following is a guest post from Neal Frankle, Certified Financial Planner. He is also the owner of Wealth Pilgrim, a personal finance blog.

Is An Expensive College A Good Investment? The Definitive Answer is a post from: PT Money: Personal Finance by PT.
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Scottrade Review

Michael — Wed, 14 Sep 2011 02:30:41 +0000

Scottrade has shown to be one of the best online stock brokers to get started with. I hear good things about them all the time from my active trader friends. They also win several awards because of their service. They ranked tops for overall customer satisfaction amongst online stock brokers by JD Power and Associates. So what exactly do they offer?

Fees and Pricing

For the active trader, a big concern is going to be fees and pricing of trades. As you can see by their marketing, Scottrade is proud of their $7 stock trades (market and limit orders). And I understand why. Compared to the Schwabs and TD Ameritrades of the world, Scottrade is cheap. However, you can find cheaper trades with other low-cost brokers. Just maybe not as nice of service. Their options pricing is $7, plus a $1.25 charge per contract. If mutual funds are your thing, they have a list of no-load, no-fee mutual funds that you can get into free of charge.

There are no fees for an inactive account, annual account maintenance, account closing, IRA termination, or online statements.

Technology and Platform

So what do they offer in-terms of an actual trading desk? How do you make trades? Scottrade offers several options for you to do your trading:

Scottrade Trading Web Site – make all your moves from any computer.
ScottradeELITE Advanced Trading Platform – an application for your desktop.
Scottrader Streaming Quotes – monitor in the real-time.
Scottrade’s OptionsFirst – an options focused application available for download.
Scottrade Mobile Trading Site – monitor and trade from any internet enabled mobile device.

ScottradeELITE Platform

A No-Fee IRA for the Active Trader

Scottrade will allow you to open a Traditional IRA, Roth IRA, Rollover IRA, and SEP IRA. If you want to actively trade a portion of your retirement savings, then an IRA from a low-cost online stock broker is a great idea. You will get all the advantages of investing with a IRA but without the big trading fees from the mutual fund companies. And keep in mind that you can have more than one IRA account. You could have one with Vanguard holding your mutual funds, and one with Scottrade holding your stocks. Just remember to keep your annual contributions limited to $5,000 across all accounts.

Customer Service and Local Offices

Scottrade is known for their excellent customer service. To reach them, you just need to call (800) 619-SAVE. The call will go to your local office or their call center (if after hours). They also have a contact form on their website. I think part of the reason they have such good service is that they have to staff their local offices. This naturally gives them a slew of people to help field calls and put out fires. Other online only brokers have to build out a customer service team, who aren’t necessarily in the trenches everyday.

Not all online stock brokers can say that they have over 450 local offices to assist you if you need face-to-face help. Each of Scottrades physical locations apparently have staff on-hand to give you live customer support, help you open an account, or answer any of your questions about their services. I find it interesting that Scottrade has the local offices like this. Have you used one of their local offices before? I’d love to hear about your experience.

Great for First-Time Active Investors

Scottrade makes a great stock broker for the investor who is looking to get into active trading for the first time. To sum up my review, I’ll list the reasons why. Because:

They have very few administrative fees to watch out for.
No fees to transfer out if you don’t like the service.
Local offices to teach you and to help you if you have questions or issues.
They have fairly cheap stock trading rates.
Do it all from within a no-fee IRA.

Add to the value of this review. Share your experience with Scottrade in the comments below.

Scottrade Review is a post from: PT Money: Personal Finance by PT.
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TradeKing $100 Cash Bonus for New Accounts

Michael — Sun, 14 Aug 2011 18:00:25 +0000

TradeKing, one of our favorite online discount brokers has launched a winter promotion where new customers earn a $100 cash bonus! In order to receive the bonus, there are a few stipulations that must be met.

The account must be opened before August 31st, 2011
$2,500 or more needs to be deposited
A minimum of $2,500 (minus losses) must be left in the account for at least six months
Three trades need to be executed within the first 180 days.
A $100 bonus link must be used when signing up. No promo code is required or accepted.

If any of these rules are not followed, TradeKing reserves the right to remove the $100 bonus from your account. It’s a little unclear as to how or when that could happen but don’t tempt them!

If you’re looking to make your very first trade, or are looking for a new online discount broker, TradeKing might be your best option. Their current commission structure is very competitive ($4.95 per trade, $0.65 per option) and TradeKing continues to win awards from Kiplinger and Smart Money for their excellent customer service. Plus, the education you can receive from the TradeKing community can help in making the tough decisions.

With top notch encryption security and cutting edge technology, TradeKing is a favorite amongst most online traders. To take advantage of this limited time $100 bonus offer (expires 8/31/11), visit TradeKing through any link contained within this post.

TradeKing $100 Cash Bonus for New Accounts is a post from: PT Money: Personal Finance by PT.
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